Is my CA state capital loss caryover from 2022 is the same as Capital Loss Carry over on my Federal Returm

[MelsTTC]

Why does Turbotax want me to enter a Capital Loss Carryover from 2022 in my state return, as opposed to automatically entering the full 2022 Capital Loss caryover from my federal return that it kindly informs me about?

I have been residing in CA permanently for 20 years, including 2023. 

[MonikaK1]

TurboTax is asking for your California carryover amount in case it differs from the Federal carryover amount. 

Though, in general, for taxable years beginning on or after January 1, 2015, California law conforms to the Internal Revenue Code (IRC), there are a few continuing differences between California and federal law. When California conforms to federal tax law changes, they do not always adopt all of the changes made at the federal level. For more information, go to ftb.ca.gov and search for conformity.

if you used TurboTax for 2022, look for your "California Capital Loss Carryover Worksheet". Line 8 shows the value to carry forward to 2023, You should be able to manually fill this in.

You also need to have California added to your return in progress in order for the carryover to populate.

See here for another discussion of this issue.

[MelsTTC]

Thank you greatly for taking the time and informing me about Federal and CA Sate taxing differences of capital loses.

you said 

"if you used TurboTax for 2022, look for your "California Capital Loss Carryover Worksheet". Line 8 shows the value to carry forward to 2023, You should be able to manually fill this in."

Yes I had used Turbotax in 2022, and the amount on Line 8 is  $3000 more than my 2023 Federal Capital Loss carryover amt, since I used up $3000 of my 2022 capital loss in my 2022 Federal taxes.  So would State of CA allow me use unreduced capital loss amount from 2022?

I hope you can help me one more time.  

[MonikaK1]

The Federal and California carryovers may not be the same and are tracked separately. The amount on Line 8 of the California Capital Loss Carryover Worksheet is what you would input if the amount didn't carry over automatically from last year. 

See this thread for another discussion of the issue. 

California Capital Loss Carryover Worksheet For Full-Year Residents - Instructions for 2022:

1. Loss from Schedule D (540NR), line 11, stated as a positive number.
2. Amount from Form 540NR, line 17
3. Amount from Form 540NR, line 18.
4. Subtract line 3 from line 2. If less than zero, enter as a negative amount.
5. Combine line 1 and line 4. If less than zero, enter -0-.
6. Enter loss from Schedule D (540NR), line 8 as a positive number.
7. Enter the smaller of line 1 or line 5.
8. Subtract line 7 from line 6. This is your capital loss carryover to 2023.

[Mansss]

Hi. I contacted Turbotax several times and either got disconnected or told I would be called back and never was. Also the people assisting don't seem to be familiar with this issue. I have the download version of Turbotax Premier for both 2022 and 2023. On my California Capital Gain or Loss Adjustment worksheet for 2022 my net loss on line 8 is $780,530. So my capital loss carryover on my Federal return on the 2023 form is $780,530. But I didn't enter anything for my California capital loss carryover on my 2023 form and I get an error message indicating such. The message also states "The federal carryover amount is not used for California because it's often a different amount".  On my 2023 Capital Gain and Losses worksheet (Form 1040)  on line 6 the short-term capital loss carryover amount is $780,530. And on line 7 is the net short-term capital loss of $782,773. On my 2023 California Capital Gain or Loss adjustment worksheet, the amount on line 6 is blank and on line 8 is -2,414. So my question is what amount do I put for my California capital loss carryover for 2023 and where do I put it? 

[JotikaT2]

The California capital loss carryover from 2022 will be reflect on your 2022 California Capital Loss Carryover Worksheet.  The amount on line 8 is your capital loss carryover amount for 2023.

Therefore, you will need access to your 2022 California state return to find this worksheet and determine the correct amount to enter into TurboTax for your 2023 tax return.

If you are using TurboTax online, once you locate the amount, you can log back into TurboTax and select Your State Returns from the panel on the left.

1. Select Edit to the right of your state.
2. Select edit to the right of Income and adjustments
3. Proceed through the screens until you see the screen titled "Here's the income that California handles differently."  
4. Scroll down to the section titled Investments and select start/revisit to the right of Capital Loss Carryover from Last Year.
5. You will be prompted to enter your state specific capital loss carryover amounts from 2022.

If you are using the desktop version of TurboTax, you can enter the California capital loss carryover amount in the state interview section of the program.

1. Select the State Taxes tab and then select edit to the right of Income and adjustments.
2. On the page titled "Here's the income that California handles differently, select edit to the right of Capital Loss Carryover from last year.  
3. You will be prompted to enter your state specific capital loss carryover amounts from 2022.

@Mansss 

[Mansss]

Thank you for your response. It seems that I should put my 2022 net loss on line 8 of the California Capital Gain or Loss Adjustment worksheet onto my 2023 form. But I'm wondering why I wouldn't reduce that amount from $780,530 to $777,530 since $3,000 was the limit to have been deducted on the 2022 return. Do I just keep inputing the $780,530 amount each year and Turbotax keeps a tally until that amount is used? 

[Mansss · Accepted solution]

Hi. I'm just following up to find out why it is that I would use the amount on line 8 of my 2022 California Capital Gain or Loss Adjustment  as my capital loss carry over amount rather than using an amount that is $3,000 less than that. It is my understanding that we can only claim $3,000 of the excess loss each year. So if the amount on line 8 of my 2022 California Capital Gain or Loss Adjustment is $780,530 why wouldn't the amount of my capital loss carry over for 2023 be $777,530? 

Thank you 

[PatriciaV]

Your carryover amount for last year is already adjusted for the allowable amount used on your prior year return. Each year, you enter the amount from the prior year return. TurboTax reduces this carryover by the allowable amount then reports the carryover for the next year. You don't need to make any manual adjustments.

@Mansss 

[shaf1]

my capital loss carry over for state is the same as federal?

[JulieS]

It depends on whether you have any capital loss carryover from the sale of items where California doesn't treat the transaction the same as it is treated on your federal return. 

To be certain, use JotikaT2's instructions above to find your 2023 California capital loss carryover. 

[swapnizzle]

@JotikaT2 Using line 8 verbatim from CA 2022 Schedule D as a 'California Capital Loss Carry over' entry for 2023 TT doesn't make sense to me.

My line 8 (from CA 2022 Schedule D) is -$38,813.

Line 9 is asking to choose the minimum of line 8 and -$3,000 (for MFJ).

Line 11 hence shows -$3,000 (from CA 2022 Schedule D)

This means that a loss of $3,000 out of $38,813 was already booked as loss in CA 2022. So carried over amount should be $38,813 - $3,000 =$35,813.

For me, $35,813 is exactly equal to the Capital Loss carry over amount that shows up in my federal return as well (since I don't have any capital losses that are treated differently for CA).

Hence, I don't think using line 8 of CA 2022 Schedule D as a 'California Capital Loss Carry over' entry for 2023 TT is the correct thing to do. We should be carrying over line 8 - $3,000 (for MFJ) instead. 

After entering $35,813 as my Capital Loss Carryover in my 2023 CA, I checked the 2023 CA Schedule D (540) and I can see correct entries:

Line 10 (Federal) matches  Line 11 (CA) (both showing a gain of $5295 in my case)

And line 12a/12b is 0.

If I had incorrectly entered $38,813 instead, I would have seen the following on my 2023 CA Schedule D (540):

Line 10 (Federal): $5,295

Line 11 (CA): $2,295 (i.e. $3000 less than Federal)

And line 12a would be $3,000....meaning that I am showing $3,000 additional loss for CA, which doesn't make any sense.