Q. (1) how much of my capital loss carry over from prior year(s) can be used to offset current year capital gains - 100% or $3,000?
A. (1) 100%. All of it can be used against this year's capital gains, long or short term.
Q. (2) Under what circumstances, and what $ amount of, capital loss carry over from prior year(s) can be used to offset ordinary income in the current year?
A. (2) . ONLY $3,000 of prior year losses can be applied against other/ordinary (non capital gains) income. But, the carry forward MUST first be used against current capital gains before being applied to ordinary income.
If you had carry over capital losses of $200,000 from prior year(s), you could use all $200,000 to offset that amount of capital gains in the current tax year. If your gains in the current year were only $50,000, you could offset the entire $50,000 with carry over losses and also claim $3000 against other income; carrying the remaining $147,000 of your $200,000 prior year carry over losses to next year. You must use the $3000 against ordinary income. You may not elect to carry it forward.
P.S. I don't see where anyone said "ONLY $3,000 of prior year losses can be applied against current year capital gains". The $3000 limit is against ordinary/other income.
