I have some carry over captial loss from last year and I have some more loss this year. How does the $3000 limit on reporting the loss works?
Lets say I had $5000 carry over from last year and I have another $5000 total capital loss this year (after offsetting all the capital income, that is), can I only report $3000 out of all $10000? Is $7000 out of $10,000 is carry over for 2007? If not, please let me know how it works.
2006-11-20 04:09:42 · 3 answers · asked by Indigo 2 in Business & Finance ➔ Taxes ➔ United States
Last year's loss carryforward is treated as if it were an additional loss incurred this year. Therefore, the annual limitation is applied to the total available losses, current as well as carried forward. The balance will be carried forward to 2007.
2006-11-20 04:15:27 · answer #1 · answered by TaxGuru 4 · 0⤊ 0⤋
You are correct.
If you have a $5000 loss carryforward to this year and another $5000 loss this year, you still can only deduct $3000. You would carry foward $7000 is losses to next year.
2006-11-20 12:18:10 · answer #2 · answered by Wayne Z 7 · 1⤊ 0⤋
You are right. Everything except for $3000 is carried over to the next year and next and next . . .
2006-11-20 12:14:18 · answer #3 · answered by spot 5 · 2⤊ 0⤋