[Anonymous]

I was going over the Transactions in Property module and I am having a little trouble on one thing and it’s driving me crazy. Here are the facts that I’ve gathered in my notes….

“Capital losses are used first to offset capital gains. If there are no capital gains, or if the capital losses are larger than the capital gains, you can deduct the capital loss against your other income — up to a limit of $3,000 in one year. Anything unused is carried forward indefinitely.”

Then, I have in my notes, this little fact….

“In a Corporation, Capital losses only offset capital gains. Any unused Capital losses can be carried back 3 years and carried forward 5 years as STCL.”

OK, so what am I missing here? First it says, any unused Capital Losses in excess of the $3,000 can be carried forward indefinitely. Then it says any unused capital losses can be carried back 3 years and carried forward 5.

Can someone clarify? I think my notes on this little topic are messed up.

Thanks!

[WhyMe23]

The first one is for individuals.

B - 85 (5/31/11)
A - 93 (7/1/11)
R - 87 (7/29/11)
F - 77 (8/31/11)

[Peanut]

Individuals can take the 3,000 deduction offset against capital gains, they can not carry back but can carry forward indefinitely

Corporations- NO 3,000 deduction, it CAN NOT offset the corps income. Carry back 3, forward 5.

Also Net Operating Loss (NOL) carry back 2 forward 20

Hope that helps! THis is my third time studying REG 😛

AUD 81 (X4) Previous scores 59, 72, 72
REG 80 (X3) Previous scores 59, 60
FAR 75 (X2) Previous score 67
BEC 79 (X2) Previous score 58

[Anonymous]

Ohhhhh!!!! LOL! Thanks for the clarification.

[Peanut]

REGs wicked tricky like that.

AUD 81 (X4) Previous scores 59, 72, 72
REG 80 (X3) Previous scores 59, 60
FAR 75 (X2) Previous score 67
BEC 79 (X2) Previous score 58

[Anonymous]

Yeah, I know. I forget one little thing and everything gets all messed up. Thanks again! You guys are the best!

[Author]

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