Q. Can Unreported Capital Loss from 2018 Carryover to 2020 Tax Return?
A. Yes, but the amount must be reduced by the amount of loss that should have been claimed on your 2018 and 2019 returns, even if you were not required to file returns for those years.
The best way to determine what the amount of the reduction was is to actually prepare 2018 and 2019 returns, even if you don't actually file them.
Lacking that, a simple rule is to just reduce the amount by $3000 per year (the maximum allowed capital loss deduction). But, a student who has no other income most likely was allowed to carry the full amount forward, each year. The rule is: if your standard (or itemized) deduction is greater than your AGI, without the capital loss, then all capital loss is carried forward.
Note: student-dependents do not get a full $12.200 standard deduction. A dependent's standard deduction is $1100 or his earned income + $350.
"also pulled the remaining money out" indicates you may have sold investments, realizing additional losses or gains that should be combined with the loss carry forward on calculating the next year carry forward.
