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NOL Carryforward for Individuals
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ElizabethP47
Level 1
10-08-2024
01:26 PM
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Situation: I have a client that ran a trucking business for a number of years and in 2022 exited the business due to the economy. Once calculated, he has a $19k NOL Carryforward. During the time of trucking, he was single. In 2023 he got married and now will be filing jointly. In 2023 he worked only W-2 jobs.
According to 536, he can only claim 80% of the excess of taxable income computed without regards to the NOL. What does the publication mean by "excess"? I also understand that this computation can only be done on his income. not joint.
I just need help with this computation. Also, what is appropriate to attach as a statement that shows the facts of this NOL?
Thank you so very much, in advance, for anyone's help.
1 Comment 1
Terry53029
Level 14
10-08-2024
03:17 PM
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An NOL is the excess of business losses over business income reduced by the excess, if any, of nonbusiness income over nonbusiness deductions. By filling out worksheet 1 in pub 536 that will give you your NOL if any. Attach a computation of your NOL using Form 1045, Schedule A, and, if it applies, your NOL carryover using Form 1045, Schedule B. Don't attach a written statement as no one will read it anyway
