NOL Carry backs for years 2020 back to 2016

Forum|Forum|4 years ago
December 28, 2021
1 reply
7 views

I have a client who has an S-Corp who has lost money 3 of the past 5 years. I would like to apply these losing tax years to her profitable tax years 2017& 2018. This would wipe out most of her tax debt. I have just done her returns from 2013-2020. I know I'll have to amend her K-1's and 1040's.

What procedure should I go through to complete this task. Any advice would be appriciated.

Michael Rhodes, EA

[email address removed]

ProSeries Professional

This topic has been closed for replies.

T

TaxGuyBill

Level 15

@Mike37 wrote:

I have a client who has an S-Corp who has lost money 3 of the past 5 years.

S-corporations don't have NOLs, they have pass-through losses. After applying the usable loss from the S-corporation for each year to the 1040, does that year's 1040 have a NOL (AGI would be negative)?

M

Mike37Author

Level 2

I think I understand what you are saying. I'll give an example to clarify.

Client has a 1040 AGI of $189,620 and a K-1 from S-corp with $-100,744 Ordinary Business Income (Loss)

If I can net that out, it would give my client $ 88,876 of AGI.

Am I understanding this correctly..???

J

jeffmcpa2010

Level 10

Try preparing the tax return and see how it comes out. Of course you need to understand and be aware of the Basis rules when it comes to S-Corp loss in order to determine whether the Loss is allowed.

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