Using Capital Loss

Forum|Forum|1 year ago
March 27, 2025
2 replies
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Why is my Capital Loss ($xx) from 2023 still showing this year? I assumed it would be automatically applied against our wages/salaries/tips last year, but it wasn't. Do I need to apply it manually, and where? Thanks!

TurboTax Self Employed Online

rjs

Employee

The 2023 capital loss should appear on line 7 of your 2023 Form 1040. If it's not there, you have to file an amended return for 2023 to apply the loss.

The maximum amount of capital loss that can be applied against ordinary income such as wages is $3,000. If the loss was more than that, line 7 of your 2023 Form should be -$3,000. The remainder of the 2023 capital loss is carried over to 2024, and to subsequent years if necessary, until it is used up. But the remaining loss will not carry over correctly to 2024 if it's not shown correctly on your 2023 tax return. You need a correct 2023 tax return in order to calculate the capital loss carryover to 2024.

contrabikeAuthor

Thanks for your response.

This capital loss is under $100, and it does appear on line 7 in 2023 tax return. I assumed it has been used up, and would not reappear again. But while doing our taxes with Turbo Tax this year I see "All capital losses used in 2024 - $0.00", and then "Remaining losses carried forward to 2025 - $xx" there it is again. Looks like it has not been used for 2023 taxes. What does it mean and how do I use it for 2024 taxes, not to see it ever again?

rjs

Employee

On your 2023 Form 1040, if line 14 is more than line 11, then line 15 will be zero. In that situation, none of your capital loss is actually "used up," even though it appears on Form 1040 line 7, so the full amount carries over to 2024.

contrabikeAuthor

Yes, the situation you described with lines 14, 11, and 15 is true for our return. So what needs to be done at this point to use up the capital loss figure?

rjs

Employee

If you have the same situation on your 2024 tax return - Form 1040 line 15 is zero - then the capital loss doesn't do you any good. Your taxable income is already zero without using the capital loss. The loss will continue to carry over from year to year until it is actually used. You don't have to do anything.