Capital loss carryover worksheet

[asdf1]

I had xx,xxx capital loss carryover in 2016, which includes the loss from previous year 2015 as well. 

For the year 2017,  I had yy,yyy profit. Now, I mention xx,xxx carryover loss in short term from 2016. 

I was under the assumption that we can claim only 3k loss per year. But turbo tax software is giving me a refund based on those losses. I want to do the right thing and dont want to have an audit for no mistake of mine. 

Can someone please advise 

[GinnyF]

Your capital loss carry over amount from 2016 can be applied to the net capital gains/losses in a future year.

The maximum loss amount per year ($3,000), is the amount your loss can go negative after being applied to the capital gains in the future year.

For example:

1. You have a capital loss carry-forward from 2016 of $10,000. In 2017 you have net capital gains of $18,000. You only pay taxes on $8,000 of capital gain.

2. You have a capital loss carry-forward from 2016 of $10,000. In 2017 you have net capital gains of $5,000. Your capital loss carry-forward will offset your $5,000 2017 capital gains to zero. Next you can use an additional $3,000 loss to reduce 2017 income. You will have a capital loss carry-forward to use in 2018 of $2,000.

When you added the brokerage statement, your income increased because of dividends, capital gains and interest income on the brokerage statement increasing your federal taxes. The loss of $3,000 would not have changed the federal taxes because it was already the maximum allowed in the return for 2017.

The only change which would result is the current years capital gains and losses, net, would be combined with the carry-over for future years.

[Glo10]

As instructed, under the section of Net Capital Losses for the previous years on the Loss Sheet, I put into the amount shown on my 2020 Notice of Assessment. However, the above amount does not transpose to Line 25300 (Net Capital Losses of other Years) on T1 General.  What else should I do?