passive activity loss carryover

[kk3gks]

I was unable to include in 2020 & 2021 tax returns (submitted via turbo tax) a passive activity loss carryover. I think I purchased the wrong turbo tax package; 2019 and back it was reported on my tax returns - I did not use Turbo Tax back then. How do I fix this so that I can use this loss in the future if I have qualifying activity? Do I have to restate the 2 years it is missing (how?) and then properly include it on my 2022 Turbo Tax return OR can I just include it on the 2022 tax return w/o restating the 2 previous years? Which is the correct Turbo Tax package to purchase?

[Anonymous · Accepted solution]

Hello kk3gks,

Thank you for participating in the Ask the Experts Event. If I understand your question correctly, you do not currently have any passive activity for 2020 or 2021 to use the loss carryover against, correct? If so, technically, you should include them in those years so that the carryovers are clean and continuous from year-to-year to avoid any confusion or complications.

TurboTax Premier and higher is the product that would allow for that. If you choose to amend those returns, you would need to manually enter it for each year and also for 2022 where TurboTax would then carry it forward each year thereafter.

If you are a gambling person, you could just included it in 2022 but be prepared to explain with documentation to the IRS if they come knocking why it was excluded from those two years.

I hope that helps.

[kk3gks]

Thanks! You are correct - I didn't have any 2020 or 2021 activity to use against the loss. I'll purchase TurboTax Premier for 2022. Will this one purchase allow me to amend 2020 and 2021 if I'm not feeling in the gambling mood? I haven't yet decided... 

[Anonymous]

No, 2022 will not allow you to amend prior years, but you should be able to amend those years online where it may upgrade you to Premier or we may have to push the software download to you (make sure you tell them you need Premier so they don't give you Deluxe if that is the version you had).

If you choose to amend and need help, log into your account and choose Live help and we can walk you through it.