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On 2018, I had $0 Income and $5,000 capital loss. Will my Capital loss carry-forward become $2,000? I believe it should be $5,000
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On 2018, I had $0 Income and $5,000 capital loss. Will my Capital loss carry-forward become $2,000? I believe it should be $5,000
It will, most likely, be $5000. But, that's not a sure thing or simple answer.
You must report the capital loss carry forward on your 2018 return. You are not allowed to postpone using it or saving it for a more advantageous time. Although you have to report it, it may not all get wasted (used). The best thing to do is prepare a 2018 tax return (even if you aren't required to file) to accurately calculate the carry over to the next year. If you used TurboTax (TT) last year, TT will automatically calculate the carry forward.
That said, and assuming you did not file last year and "had $0 Income" literally means that line 6 of your 2018 form would have been 0, if you had filed; then the entire $5000 carries over to 2019.
Basically you are allowed to use you standard or itemized deductions to reduce your taxable income before having to use your capital loss.
Another way to say it is: If your standard (or itemized) deduction is greater than AGI, without capital loss, then all the capital loss is carried forward.
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On 2018, I had $0 Income and $5,000 capital loss. Will my Capital loss carry-forward become $2,000? I believe it should be $5,000
I submitted my 2018 tax return last year (not with TurboTax).
I agree with you that it should be $5,000, but when I put this information in Turbo Tax ($5,000 capital loss and $0 AGI), its defaulting to $2,000. I am not sure If I can change this.
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On 2018, I had $0 Income and $5,000 capital loss. Will my Capital loss carry-forward become $2,000? I believe it should be $5,000
In TurboTax (TT), enter at:
- Federal Taxes tab (Personal in Home & Business)
- Wages & Income
Scroll down to:
-Investment Income
-Capital Loss carryover
My experience (I use desk top software) is that TT pre-populates that info from last year's return, but allows you to change it. Read the choices carefully.
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