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how to enter $96,000 in disallowed losses on schedule e rental property

Level 3

have a new client he sold his rental income in 2023 and on his 2022 income tax return on Schedule e it shows a $96,000 disallowed loss on his rental property from 6-1-23.  He has made over $500,000 most of those years.  Which forms do I need to use to recapture these loss's, or can this be done?  Thank you


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5 Comments 5

In LC there is a box for Complete Disposition of Passive Activity. I don't know about PS.

Level 15
Level 15

On the Sch E worksheet, checking Box H will release any suspended losses.

Or are you asking where to enter those prior suspended losses?   Scroll down down down the Sch E worksheet and theres a place you can enter prior year losses....then Box H will release them when its sold.

Level 13

Same on the PS Sch E worksheet. The suspended losses are on the lower part of the Sch E worksheet.

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Level 3


Thank you so much for your reply however the situation with the prior year losses is that I did not do tax year 2022, so I am looking for your assistance, where do i first put the carry over losses that he could not deduct  I can not find the prior year losses (is it named something else) is it suspended loss? and then I check box h (he did sell property in 2023)  At your mercy!

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Level 15

About 1/3 of the way down on the Schedule E Worksheet, look for the "Carryovers to 2023 Smart Worksheet".  If the 2022 carryover was shown on Form 8592, you enter it on the worksheet as a "Passive Loss" carryover.