Can I use my previous years capital gain loss carryover without any capital gains this year

[Hal_Al · Accepted solution]

Yes. In fact, you are required to use it, this year, to the extent you can (usually $3000). if you used TurbpTax last year. all of that will happen automatically

[DEN]

So does that mean you take the $3,000 capital deduction every year? For example: in 2012 I had $30,000 in capital losses; I take a $3,000 deduction. In 2013 I have no activity - no gains or losses. Would I then take a $3,000 deduction reducing my capital loss carryover to $27,000?

[Hal_Al]

Yes. The $3000 capital loss you claim in 2013 will reduce your other taxable income and $27,000 will carry over to 2014.
But, if you have a capital gain in 2014, the 27,000 carry over will be used against it. Using an example: let's say you sold stock in 2014, realizing a $10,000 gain. On schedule D, the $10,000 gain will be combined with the $27,000 carry over loss for a new net loss of $17,000. $3000 will be deducted (on line 13 of form 1040) against other income and $14,000 carried over to 2015.

[DEN]

Hi ok thanks super helpful! So when there is no investment activity - you still get the benefit of the $3,000 deduction each year until your capital loss carryovers are zero. Well, looks like I'll have to be revising my historic return!