Tax loss carry forward questions

Financial Planning Tax Strategies
#1

What Is a Tax Loss Carryforward?
A tax loss carryforward (or carryover) is a provision that allows a taxpayer to move a tax loss to future years to offset a profit. The tax loss carryforward can be claimed by an individual or a business to reduce any future tax payments.

[https://www.investopedia.com/terms/t/tax-loss-carryforward.a…](https://www.investopedia.com/terms/t/tax-loss-carryforward.asp#:~:text=A%20tax%20loss%20carryforward%20(or,reduce%20any%20future%20tax%20payments).

Question 1. Is there a time limit to the carry forward?
Say an individual taxpayer has $400,000 in realized losses.

How long can those losses be carried forward? 10 years? 50 years? Indefinitely?

Question 2. Businesses can apply today’s losses retroactively to previous tax years - called “carryback”.
The Tax Cuts and Jobs Act (TCJA) removed the 2-year carryback provision, extended the 20-year carryforward provision out indefinitely, and limited carryforwards to 80% of net income in any future year.

https://www.investopedia.com/terms/l/losscarryforward.asp#:~….

Is carryback available to individuals?
Is so, when would it make sense to do it?

:vulcan_salute: TIA
ralph

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#2

Individuals are not able to carryback most capital losses.

If you have losses from not generic stock/mutual fund/ETF sales then you should investigate the specific item.

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#3

Thank you for the reply. Just wanted to clarify…I am assuming you said stock sold at loss are not eligible for capital loss carryback by individuals.

Are the ETFs/ mutual funds sold at loss eligible for capital loss carryback by individuals?

Thanks a lot,
Charlie

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#4

Are the ETFs/ mutual funds sold at loss eligible for capital loss carryback by individuals?

No. The only losses eligible for carryback by individuals at the present time are those generated by farming.

Ira

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#5

Thanks so much,
Charlie