QBLoss Carryforward

Forum|Forum|3 years ago
April 5, 2023
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I had a QBLoss from 2021 which I had intended to bring forward eventually to 2023. I have now discovered that this loss was instead realized in 2021 on line 8 of form 1040 by reducing that year's Taxable Income. Not a huge deal due to the size of the loss. However, I'm finding the identical situation now occurring for 2022 and for another loss which I need to carryforward from 2022 to 2023; this loss is more sizeable and needs to be moved forward to 2023. I'm basically not understanding why TT is not carrying forward a QBLoss but instead taking the current loss to reduce a current year's Income?

Mike9241

by QB loss do you mean QBI loss/199A loss. An activity can generate an ordinary loss that gets deducted on your 1040 to the extent allowed by law. has nothing to do with 199A/QB. If the activity is a qualified business with a loss the 199A/QB amount, usually the same as the ordinary loss gets carried forward for next years QB/199A computation. so with a qualified business activity there are two elements the 1040 ordinary income/loss element and the the 199A income/loss element, An ordinary loss would normally be allowed each year if not from a passive activity but if it is then it is subject to the PAL rules for deductibility. however a QB loss can not go negative but becomes a carryforward. see form 8995.