Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
vriley22288
New Member

My capital loss used in 2016 is $4,159, I thought the maximum allowed was $3,000. Can you please explain how this works?

 
1 Best answer

Accepted Solutions
MichaelL1
Level 15

My capital loss used in 2016 is $4,159, I thought the maximum allowed was $3,000. Can you please explain how this works?

The loss taken is limited to $3,000 a year, however if you have gains, that amount offset against the gains does not impact the $3,000.

For example, I sold some stock in 2016 and made $1,570 profit, and I had a $10,000 capital carryforward from 2015.

Then $10,000 first is reduced by the $1,570, then I claim a -$,3,000 on my return for capital loss.

 My carryover to 2017 is now $5,430 ($10K -$1,570 - $3,000).

View solution in original post

1 Reply
MichaelL1
Level 15

My capital loss used in 2016 is $4,159, I thought the maximum allowed was $3,000. Can you please explain how this works?

The loss taken is limited to $3,000 a year, however if you have gains, that amount offset against the gains does not impact the $3,000.

For example, I sold some stock in 2016 and made $1,570 profit, and I had a $10,000 capital carryforward from 2015.

Then $10,000 first is reduced by the $1,570, then I claim a -$,3,000 on my return for capital loss.

 My carryover to 2017 is now $5,430 ($10K -$1,570 - $3,000).

Dynamic AdsDynamic Ads
Privacy Settings
v