Let’s say I have $10,000 carryover losses from prior year. Filing jointly.
1) Scenario 1
(A) This year, I have $7,000 gain, that mean I can use $7,000 carryover to offset all the gain, leaving $3,000 left carryover, CORRECT?
(B) Can I ALSO use the last $3,000 to offset ordinary income?
2) Scenario 2
(A) This year, I have a loss of $3,000, does that mean only this $3,000 will be use to offset ordinary income?
(B) If this year, I have $2,000 loss instead, does that mean I need to use this $2,000 and $1,000 from my carryover to offset my ordinary income?
Thanks
