Are passive K1 losses carried forward if you do not qualify for special allowance?

I have a large loss from a passive K1 rental activity. However my MAGI is above the limit where i can apply that loss to my ordinary income. Can i carry forward the extra such that if next year I do qualify for the special allowance or have other passive income gains?

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1 Best answer

Expert Alumni

Mar 13, 2022 1:18:12 PM

Yes. Form 8582 is required. TurboTax will populate form 8582 and file it with your tax return.

Next year, when you import the 2021 tax return to start you 2022 tax return, that suspended loss will be carried over.

Expert Alumni

Mar 13, 2022 12:40:10 PM

Yes. These passive losses are suspended and can be used to offset future passive income.

Level 1

Mar 13, 2022 12:50:42 PM

Thanks. Do you know if i have to fill out a special form to do that (8252? - right now it shows up in that form as unallowed loss)? Or will TT automatically carry it forward for me?

Expert Alumni

Mar 13, 2022 1:18:12 PM

Yes. Form 8582 is required. TurboTax will populate form 8582 and file it with your tax return.

Next year, when you import the 2021 tax return to start you 2022 tax return, that suspended loss will be carried over.

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Are passive K1 losses carried forward if you do not qualify for special allowance?