Where do I look on my tax return to make sure that TurboTax is maximizing deductions for my investment losses?

[rjs]

There is only one way to calculate investment gains and losses. You can be confident that TurboTax is doing it correctly. There are no options for how to calculate it.

Do you also have investment gains? Gains and losses are summarized on Schedule D, so that's where you should look. Losses are first used to offset gains. After adding up all of your gains and subtracting all of the losses, the overall net gain or loss is on Schedule D line 16.

If Schedule D line 16 is a net gain, the gain amount goes to Form 1040 line 7. All the losses have already been subtracted.

If Schedule D line 16 is a net loss of less than $3,000, the loss amount goes to Form 1040 line 7 as a negative number. The entire loss is applied against other income.

If Schedule D line 16 is a net loss of $3,000 or more, Form 1040 line 7 will show a loss of $3,000, which is applied against other income. That's the maximum amount of net investment loss that can be applied against other income in one year. The remaining loss becomes a capital loss carryover to next year.

[Li60]

thank you, your answer was very helpful   I just have one more question. Does Turbo tax carry over the net losses that exceed the $3000 cap to the next year? Where do I look to confirm that was done?

[rjs]

Yes, TurboTax will carry over the losses as long as you use TurboTax every year, and transfer information from the previous year when you start your new tax return.

You can see the carryover by going to the Capital Loss Carryover topic under Investment Income. In the Search box type "capital loss carryover" (without the quotes), then click the link that says "Jump to capital loss carryover." The carryover amounts will also appear on Schedule D lines 6 and 14.

[VolvoGirl]

The current year carryover loss from the prior year is on schedule D line 6 & 14.

On the income page The 2023 column shows the carryover to 2024 (not your current loss for 2023).  Schedule D doesn't actually show the carryover amount. To find your  Capital Loss Carryover amount  you need to look at your  return schedule D page 2.  Line 16 will be your total loss and line 21 should be a max loss of 3,000.  The difference between line 16 and 21 is the carryover loss for next year.

There is also a Carryover Worksheet showing the carryover from the prior year and the current amounts.  Then there is also the Capital Loss Carry Forward worksheet showing the amount transferring over to next year.

In the Online version you have to save your return with all the worksheet as a pdf file to your computer to see the Capital Loss Carry Over and Carry Forward worksheets.

In the Desktop program you can go to Forms and find it in the list in the left column.

If you have a negative AGI or negative taxable income it will show up on 1040  BUT it won't reduce the carryover to the next year.