Stock Trading Losses

[JoeMal]

Had minimal income during and right after covid. Started day trading. Had losess of 12k over last 3 years.

Made decent income this past year. Can i deduct the 12K incured over the last 3 years in trading losses from income generated from other sources in 2023? 

[JulieS · Accepted solution]

No, but you can deduct up to $3000 ($1500 if married filing separately) of capital loss carryforward against your other income each year until the amount is used up. 

The way this works is that each year you report your sales on your tax return. If it nets out to a loss, you use $3000 loss for the current year and the rest of your loss carries forward to the next year.

So you can't save the $12,000 loss and use it when you want to. You just carry the amount forward until it is all used up. 

If you have filed with TurboTax every year, your losses stay in your account and are carried forward automatically. 

[JoeMal]

Can i go back to 2022 taxes and deduct $3K if i had a net gain for that year?

[MayaD]

Yes. Amend your 2022 return first. 

How do I amend my federal tax return for a prior year?