If I have capitol loss carryover from previous year returns with none this year, can I continue to carry those over to next year, keeping the turbotax free return option?

[lmoreoferrall-gm]

I work part time and my yearly income was at a low enough level that $0 is taxable income, therefore the capitol losses carried over from previous years will not help me at all this year but could help me in the future. On turbotax it looks like if I don't use the capitol losses from previous returns I will continue with the free simple return version of filing. Thanks.

[VolvoGirl · Accepted solution]

You have to report the carryover every year until it's used up. You can't skip a year. Even if you don't report it on your return you have to reduce it by the 3,000 (1,500 MFS) when you carry it over to next year. You can't choose when to use it.

But if you have a negative AGI or negative taxable income it will show up on 1040 BUT it won't reduce the carryover to the next year.

[rjs]

You do have a capital loss carryover this year, even if it doesn't reduce this year's tax. As VolvoGirl said, you have to carry it over from year to year. You cannot skip a year. Since you cannot report a capital loss carryover in TurboTax Free Edition, you will not be able to use Free Edition until you have used up the entire capital loss carryover. If your 2023 Adjusted Gross Income (AGI) is $79,000 or less you might be able to file for free using IRS Free File.

I would not advise omitting the capital loss carryover from your 2023 tax return. If you claim a capital loss carryover on your 2024 tax return, but there is no capital loss on your 2023 tax return, I assume that the IRS would disallow the carryover for 2024. It's easy enough for them to check the immediately preceding year. They are not going to search earlier years to see if there is a capital loss that you did not carry over.