Must I take $3,000 of capital losses?

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Subject Author Date Must I take $3,000 of capital losses? ted 10-26-2009  Re: Must I take $3,000 of capital losses? Arthur Kamlet 10-26-2009  Re: Must I take $3,000 of capital losses? HLunsford 10-26-2009  Re: Must I take $3,000 of capital losses? ted 10-26-2009  Re: Must I take $3,000 of capital losses? removeps-groups@yahoo.com 10-26-2009  Re: Must I take $3,000 of capital losses? D. Stussy 10-27-2009  Re: Must I take $3,000 of capital losses? ted 10-27-2009  Re: Must I take $3,000 of capital losses? HLunsford 10-27-2009  Re: Must I take $3,000 of capital losses? D. Stussy 10-26-2009
Posted by ted on October 26, 2009, 10:13 am Please log in for more thread options I understand I can take $3,000 worth of carried forward capital losses against ordinary income, but do I have to? TaxCut just does it without asking, so I presume it is required, but TaxCut could be wrong. Thanks. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Arthur Kamlet on October 26, 2009, 10:42 am Please log in for more thread options >I understand I can take $3,000 worth of carried forward capital losses >against ordinary income, but do I have to? > >TaxCut just does it without asking, so I presume it is required, but TaxCut >could be wrong. Thanks. TaxCut seems to be right. If you have a capital loss carryover, you must fill out the capital loss carryover worksheet and carry over the calculated amount to your schedule D, where it will reduce your capital gains/loss up to a maximum of 3000. But if your income is very low, even though it might appear to reduce your carryover and use up some of your carryover loss, it might not. That's where the worksheet comes in. -- ArtKamlet at a o l dot c o m Columbus OH K2PZH -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by HLunsford on October 26, 2009, 3:14 pm Please log in for more thread options ted wrote: > I understand I can take $3,000 worth of carried forward capital losses > against ordinary income, but do I have to? > > TaxCut just does it without asking, so I presume it is required, but TaxCut > could be wrong. Thanks. > Curious, but just why would you not want take a deduction of $3,000 against other income? It would lower your tax, you know. ChEAr$, Harlan Lunsford, EA n LA -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by ted on October 26, 2009, 6:09 pm Please log in for more thread options > ted wrote: >> I understand I can take $3,000 worth of carried forward capital losses >> against ordinary income, but do I have to? >> >> TaxCut just does it without asking, so I presume it is required, but >> TaxCut could be wrong. Thanks. > Curious, but just why would you not want take a deduction of $3,000 > against other income? It would lower your tax, you know. > I have way more deductions already to lower my income to zero; this is completely wasted. It would be nice to save it for a year in which I could use it. Should there ever be such a year... -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by removeps-groups@yahoo.com on October 26, 2009, 7:32 pm Please log in for more thread options > > >> I understand I can take $3,000 worth of carried forward capital losses > >> against ordinary income, but do I have to? > > >> TaxCut just does it without asking, so I presume it is required, but > >> TaxCut could be wrong.  Thanks. > > Curious, but just why would you not want take a deduction of $3,000 > > against other income?  It would lower your tax, you know. > > I have way more deductions already to lower my income to zero; this is > completely wasted.  It would be nice to save it for a year in which I could > use it.  Should there ever be such a year... Follow the capital loss carryover worksheet mentioned by Art. An example: Suppose on last year's return you had a net long term loss of 5k. And suppose for last year your AGI was 20k, and your itemized deductions were 27k. http://www.completetax.com/taxguide/tools/downloads/caploss.pdf line1=-7000 (income after itemized deduction, but before exemption) line3=line1-line2=-7000 line4=3000 (loss as a positive number) line5=line3+line4=-4000 line6=-4000 (smaller of line4, line5) line11=5000 (long term loss as a positive number) line12=0 (short term gain) line13=0 (line6-line7, but not less than zero) line14=line12+line13=0 line15=line11-line14=5000 Your capital loss carryover is the full 5k, not 2k. Now suppose your AGI is 26k. line1=-1000 (income after itemized deduction, but before exemption) line3=line1-line2=-1000 line4=3000 (loss as a positive number) line5=line3+line4=+2000 line6=+2000 (smaller of line4, line5) line11=5000 (long term loss as a positive number) line12=0 (short term gain) line13=2000 (line6-line7, but not less than zero) line14=line12+line13=2000 line15=line11-line14=3000 The capital loss carryover is 3k, as if only 2k were used up in the previous year. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted Short Term Capital Gains and Long Term Capital Losses January 13, 2007, 2:12 am Write-off capital losses February 13, 2007, 1:30 am Locking in Capital Losses? 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