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Level 2
December 19, 2020
Solved

Will my investment loss this year carryover into a future trading LLC I plan on creating next year?

  • December 19, 2020
  • 5 replies
  • 84 views

I currently have more capital losses than gains so I'll be getting 3k of it back next year. As funny as it sounds, next year, I plan on starting a trading LLC with the goal of achieving the "trader tax status" and the 475 election. Am I going to be able to roll the remainder of this loss onto next year's (new llc's) income? Or do I have to hurry and try to create the LLC in the next 10 days.. 😂

Best answer by M-MTax

The capital loss carries over to next year.

5 replies

M-MTax
M-MTaxAnswer
Level 15
December 20, 2020

The capital loss carries over to next year.

Keep1upAuthor
Level 2
December 20, 2020

I'm aware that the capital losses roll over, but I guess what I'm asking is will my previous "capital" losses convert to "ordinary" losses after the LLC is formed, or will they remain separate?

M-MTax
Level 15
December 20, 2020

Those losses won't convert to ordinary losses.