Capital Loss Carryover Calculator
Track and calculate capital loss carryovers from prior years. Apply carryover losses against current year gains, understand offset rules, and project future year deductions.
Prior Year Carryover Loss
Enter negative value for loss carryover. Example: -15000 means $15,000 loss carried forward.
Check prior year tax return for exact split. Schedule D shows ST and LT carryover separately.
Current Year Capital Activity
Assets held under 12 months. Taxed at ordinary income rates.
Assets held over 12 months. Taxed at preferential 0-20% rates.
Affects ordinary income deduction limit: $3,000 (single/MFJ) or $1,500 (MFS).
Loss Sources Available
Prior Year ST Loss:$7500.00
Prior Year LT Loss:$7500.00
Current ST Losses:$0.00
Current LT Losses:$0.00
Total ST Available:$7500.00
Total LT Available:$7500.00
Loss Offset Order Applied
ST Loss → ST Gains:$5000.00
ST Loss → LT Gains:$2500.00
LT Loss → LT Gains:$7500.00
LT Loss → ST Gains:$0.00
Total Loss Applied:$15000.00
IRS offset rules: Same type first, then cross-type, then $3,000 ordinary income deduction.
Final Position After Carryover
Net ST Gains:$0.00
Net LT Gains:$0.00
Total Net:$0.00
Ordinary Income Deduction
Deduction Limit:$3000
This Year Deduction:$0.00
Tax Savings (~22%):$0.00
Losses exceeding gains can deduct up to $3,000 from ordinary income annually.
Tax Impact Summary
Tax Without Carryover:$3250.00
Tax With Carryover:$0.00
Total Tax Savings:$3250.00
Capital Loss Carryover Rules
- Indefinite Carryforward: Capital losses carry forward indefinitely, no expiration. Track on Schedule D each year.
- $3,000 Annual Deduction: Net losses exceeding gains can deduct $3,000 ($1,500 MFS) from ordinary income each year.
- Offset Order: ST losses → ST gains → LT gains. LT losses → LT gains → ST gains. Then $3,000 ordinary deduction.
- Short-Term More Valuable: ST losses offset ST gains first (saving at 22-37% vs 15-20%). Prioritize using ST carryover.
- Schedule D Tracking: Form shows prior year ST and LT carryover separately. Lines 6 and 14 for 2024 Schedule D.
- State Differences: Some states have different carryover rules. CA allows indefinite carryforward, same $3,000 deduction.
- Death Termination: Unused capital losses expire at death. Cannot pass to heirs. Consider accelerating use if estate planning.
- Strategic Use: If large carryover, realize gains to offset them tax-free. Better than $3,000 deduction at 22% vs offsetting gains at 15%.
Tax Planning Strategies
- Realize Gains: If $50K carryover, sell $50K of appreciated stock. Gain offset by carryover = $0 tax. Better than $3,000/year deduction.
- Timing: Large carryover with no gains? Consider rebalancing portfolio to realize gains tax-free, then reinvest.
- Roth Conversion: Convert Traditional IRA to Roth. Capital losses can offset other income, making conversion more affordable.
- Check Prior Return: Look at last year's Schedule D lines 6 (ST carryover) and 14 (LT carryover). Enter exact amounts here.
- Broker Reports: 1099-B shows realized gains/losses. Import into tax software. Carryover auto-calculated from prior year.
- Long-Term vs Short-Term: Know your carryover type. ST losses more valuable (offset higher-rate gains first).