I spoke with TT and they are quoting Pub 925 (pg. 5) saying that this situation isn't a passive activity and, while I don't see it stated explicitly, that you can only deduct expenses equal to income.
HOWEVER, Pub 527 (pg. 19) acknowledges that this situation isn't a passive activity and directs you to Worksheet 5-1 to determine your carryover losses. When I fill in the worksheet by hand, I get the carryover amount.
The problem is that TT doesn't have a Worksheet 5-1 and doesn't show anywhere on the 8582 that the loss is calculated or carried over.
