Hi:1040 2019 NOL Carryback

[mike9]

Hi:

I have a client with a 2019 NOL . The return was filed. Now I am getting ready to to do a  2018 1040-X to carry it back.

Should I have made any election when I filed 2019 to state that I am going to carry it back back to 2018 

Also can I carry back the loss to any of the previous 5 years or do I have to apply it to 2014, 2015, 2016 and 2017 before applying it to 2018

Thanks for your help

Mike

[Just-Lisa-Now-]

You carry back to the 5th year then carry any unused portion forward until its used up.

[mike9 · Accepted solution]

Thanks Lisa...I also assume that I do not have to make a statement with my 2019 return regarding the carry back

Cheers

Mike

[Just-Lisa-Now-]

Im not sure on that, they changed the game part way through the season and I lost track of the rules!

[sjrcpa]

Use Form 1045, not 1040X. It is supposed to be processed in 90 days, and it can be faxed to IRS.

[TaxGuyBill]

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@mike9 wrote:

Thanks Lisa...I also assume that I do not have to make a statement with my 2019 return regarding the carry back

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Correct.  You only need to make a statement if you want to make the election to NOT carry it back, and only carry it forward.

As Susan pointed out, another option to amending the 2014 tax return is to file Form 1045.  The form effectively gives the refund based on the 2014 tax return, without actually amending 2014.  And with the current HUGE backlog of paper-filed returns at the IRS, faxing Form 1045 will result in a refund much quicker than amending.

[mike9]

Thank you Bill...that was so helpful. There had been conflicting guidance on this from the Service and the client has a huge tax delinquency from 2018 .

Regards

Mike