we don't know what activity the LLC was engaged in but generally, losses would be ordinary and would offset other ordinary income such as wages, interest, dividends, etc. losses from the business in excess of other ordinary income would then offset capital gains. offsetting ordinary losses with capital gains may not be the most advantageous. as an example say $X of ordinary losses year 1 and $X long-term capital gains year 2. depending on your tax situation the ordinary losses could save you some income taxes in year 1. in year 2 because of the preferential rate given to LTCG you might pay $0 in income taxes on them.
