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Entering a net operating loss (NOL) for a year other than current tax year in Lacerte

by Intuit•21• Updated 1 month ago

This article will assist you with entering a net operating loss (NOL) from a year other than the current taxable year.

Whether the NOL is a carryback in prior years or a carryforward, the entries must be made on Screen 15, Net Operating Loss.

There are three mandatory entries:

  • Year of loss (e.g., 2024) (MANDATORY)
  • Initial loss
  • Carryover available in 2025

If AMT is involved with the NOL, enter amounts for AMT initial loss and AMT carryover available in the current year. Amounts flow to Form 1040 as Other Income.

For tax year 2021, if there is an NOL for 2018 or newer, you'll receive diagnostic ref #53656:

  • NOL #: The program doesn't automate the limitation of post-2017 net operating losses to 80% of taxable income, before taking into account any NOL deduction. You must override the amount of post-2017 NOL carryforward absorbed this year so it does not exceed the 80% of taxable income limit.

Calculate the allowable amount of the NOL and enter the override on Screen 15 in the NOL absorbed in 2025 field. See here for the most up to date information from the IRS.

The NOL absorbed in 2025 field will not work for losses from 2017 and earlier. For older years, the Carryover available in 2025 could be changed to the amount of NOL you want used and you can track the amount that is available separately to remind you to manually adjust the amount in the next year after the proforma (such as on the Notes screen as a worksheet).

F1 Help for the NOL absorbed in 2025 [O] override includes Make an entry to override the program calculation for the amount of post-2017 NOL carryover absorbed in the current year

For most taxpayers, NOLs arising in tax years ending after 2020 can only be carried forward. See Net operating losses for more information.

Related topics

Lacerte Tax
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