topic Stock Trading losses carry forward from 2019 to 2020 in Investors & landlords

Stock Trading losses carry forward from 2019 to 2020

sskk — Thu, 31 Dec 2020 01:19:18 GMT

For example, if I had a $10K 2019 stock trading loss carried forward to 2020, and I had a net 2020 stock trading gain of $40K, my understanding is my 2020 taxable amount would be $30K, correct? I had a TurboTax live call today and the lady confused me with her answer that I can only use $3K of carrying forward loss to offset against my gain of $50k in 2020. Please assist and confirm.

Thank you

Re: Stock Trading losses carry forward from 2019 to 2020

VolvoGirl — Thu, 31 Dec 2020 01:24:50 GMT

Yes You can deduct the full amount 10,000.

You get to first offset the loss against any gains you have each year so that can use more of it up. Then after applying the loss to the current gains you can take a max loss of 3,000 (1,500 MFS)per year. Turbo Tax does all the calculations for you. Just enter the prior year carryover amount.

If you transferred your prior return it should be already filled in.

Enter a Capital Loss Carryover under

Federal Taxes or Personal (Home & Business)

Wages and Income

Then scroll down to Investment Income

Capital Loss Carryovers - Click the Start or Update button

Re: Stock Trading losses carry forward from 2019 to 2020

Bsch4477 — Thu, 31 Dec 2020 01:30:23 GMT

You are correct that your carryover loss is subtracted from your 2020 gain. TurboTax will calculate that for you if you used the program last year and you carry over your data. The $3,000 amount refers to the fact that if you had a net capital gain loss of more than $3,000, only a maximum of $3,000 would be subtracted from your other income. The rest would be carried over to the next year. But that is not your situation.

Re: Stock Trading losses carry forward from 2019 to 2020

VolvoGirl — Thu, 31 Dec 2020 01:33:43 GMT

You said 2 amounts. Do you have net gain for 2020 of 40,000 or 50,000? Doesn't matter, you get to use the whole 10,000 carryover amount.

Re: Stock Trading losses carry forward from 2019 to 2020

fanfare — Thu, 31 Dec 2020 04:56:08 GMT

as often happens, the so-called experts at TurboTax gave incorrect information.

The "Live" person is supposed to be a CPA and should know the correct answer.

Re: Stock Trading losses carry forward from 2019 to 2020

Critter-3 — Thu, 31 Dec 2020 19:58:25 GMT

It all depends on the question that is being asked ... ask a bad question and you get a bad answer. The answer given was to a different question ... so who was misunderstood ? The poser of the question or the person answering ?