Can I defer Schedule D carryover from last year into next year rather than offsetting 2016 gain? And not take the $3,000 against regular income? How in Turbo Tax?

[MinhT · Accepted solution]

No, you cannot defer the use of your capital loss carryover until next year. If you have a net capital gain in 2016, the capital loss carryover must be used to offset it, and if there is still a capital loss carryover left, you have to take the $3,000 deduction against regular income.

[YQ]

What if I do not have income to deduct this $3000? If I deduct $3000, my income will be negative.

Can I defer the capital loss carryover to next year?

[dmertz]

The negative $3,000 must be shown on Schedule 1 line 13, but the portion of that that would reduce your taxable income below zero continues to carry forward.  For the calculation, see TurboTax's Capital Loss Carryforward Worksheet.

[YQ]

@dmertz , thanks for reply. Your answer is very helpful. I'll look into details of my past 3 years return and check if my capital loss carryforward are correct.

[dmertz]

On tax returns prior to 2018 the negative $3000 would be on Form 1040 line 13.

[VolvoGirl]

If you have a negative AGI or negative taxable income read Pub 550 page 66 on Figuring your Carryover.  So even though it shows it on 1040 it doesn't reduce the carryover to the next year.

http://www.irs.gov/pub/irs-pdf/p550.pdf

You can see it on the Carryover Worksheet. There is a Capital Loss 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