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dr27405
Level 1

Unused NOL Carryforward Process

I am confused how a an unused 2017 NOL  is carryforward.  In 2018 all of the NOL showed up on line 21 of schedule 1.  Not all of it was needed.  Together with other passive losses and Capital loss the, line 22 on Schedule 1 was (146,034), which flowed through line 6 of 1040, making my AGI on line 7 (92101).  What are the steps to properly carry this unused NOL to 2019?

 

for now I manually entered the unused NOL carryforward in the business sectionIn 2019 and it moves to 1040 7a as a negative number, after the income is subtracted, line 7b shows a negative agi.  How do I move unused 2017 NOL to 2020? 

 

I don't understand if all the NOLs show up on Schedule 1 does it meant they are all being used up even if I don't need them?  I should be able to carryforward for 20 years untli needed.  In 2017, I did file and submited the Election to forego the carryback  period of the NOL. 

 

Even if I use the workseet 2 in publication 536 and it gives me how much I can carry forward, how tod I make that happen in Turbo tax.  I have read this so many time, i am getting confused.  When all th eNOLs show up does it mean they are all being used up or that is the normal process.  Please provide step by step process to properly enter NOL in TT.

 

Thank you 

2 Replies
RobertG
Expert Alumni

Unused NOL Carryforward Process

​​​​​​​Here's how to enter a 2019 NOL carryforward in TurboTax:

  • Do a Search (upper right) and enter "net operating loss" (without the double quotes)
  • Click on the "jump to" result
  • Enter your NOL on the screen that appears.

 

Note, if you did your taxes last year with TurboTax and generated an NOL carryover, then in many cases, TurboTax will carryover the NOL automatically to the next year. Check for this in case it appears that your NOL carryover is being double-entered in your 2019 tax return.

 

This question was previously answered by  BillM223

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dr27405
Level 1

Unused NOL Carryforward Process

Robert,

I did the steps you described and the NOL from 2018 shows up on 2019 schedule 1 line 8 (other income) .  The carryforward from 2018 is combined with (25000) of Rental Real Estate losses and carries over to line 7a.  This loss subtracted from all on 1040 resulting in a (63506) AGI.  From this I subtract 27000 of standard deduction and have 0 taxable income.

 

First a silly question, in this case, just because the all losses show up on the tax return it does not mean they are used up right?  

 

2nd because there are losses and they are from 2017 (yes I filed election to forego the Carryback), I now fill in Worksheet 2, WRKST to figure how much of the NOL to carryover from 2019 to 2020 (For NOL carryforward from a year before 2018).  I have a question on this worksheet.

 

Line 1 Enter as a pos. # your NOL deduction for the NOl year entered above from Sched 1: I entered (89642) which showed on 2019 Sched 1 line 8, other income

 

Line 2 Enter your taxable income without the NOL deduction for 2019. 

(Instructions:Enter your taxable income without the NOL deduction for the year listed at the top of Worksheet 2, but with the NOL deduction from any prior year.)

The NOL deduction for 2019 is (864)

 I entered my AGI (63506) which is all my non business income $[social security number removed](cap gain losses)-25000 (real estate bus losses) -89642 (NOL from 2017)=(63506) MY AGI on 1040 line 8b.  Is this correct, do I subtract the Standard deduction too?

 

Line 3 net capital loss deduction: 3000 

Line 4,5,6 are 0

Line 7 Enter any adjustments to your AGI. See Instructions. 

You must refigure the following income and deductions based on AGI.- Why does it say REFIGURE?

  1. The special allowance for passive activity losses from rental real estate activities. This is the only one I have 25,000 .  But it stays the same based on AGI.  do I enter 25,000 on line 7 or 0 because it stays the same.
  2. Taxable social security and tier 1 railroad retirement benefits.
  3. IRA deductions.
  4. Excludable savings bond interest.
  5. Excludable employer-provided adoption benefits.
  6. The student loan interest deduction.

 

I really appreciate it if you can tell me if I am interpreting Worksheet 2 correct or not?

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