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As any Net Operating Loss (NOL) has the potential to be carried back or forward from the year of the loss, depending on the choices made by the taxpayer, the TaxAct® program does not automatically calculate the amount to be carried forward to the following year in an import situation.

If you have calculated a NOL from the prior year (Line 25 of Form 1045 Schedule A-NOL from that prior year), and need to enter that amount on Line 21 of Form 1040, you can enter the amount in your TaxAct return following the steps below (Note: You will still be able to electronically file your tax return).

  1. From within your TaxAct return (Online or Desktop) click on the Federal tab. On smaller devices, click in the upper left-hand corner, then select Federal
  2. Click Other Income to expand the category and then click Net Operating Loss (NOL) Carryforward
  3. Enter the appropriate amount from your calculations on Form 1045 that is to be carried forward to the current year

If you have an allowed loss from Schedule K-1, the amount would be reported on Line 17 of the 1040, based on the data you entered in the program for the Schedule K-1. 
 
If the loss is not entirely used in the first year following the loss year, or if there are NOLs being carried forward from multiple years, see IRS Publication 536 Net Operating Losses (NOLs) for Individuals, Estates and Trusts to calculate the amount to enter on Line 21 of Form 1040. Use the worksheet on page 8 (instructions on page 7) to calculate the amount to enter on Line 21. If there are NOLs being carried forward from multiple years, you must calculate each amount separately and then add them together to enter on Line 21.

Additional Information

IRS Publication 536 Net Operating Losses (NOLs) for Individuals, Estates and Trusts explains how to figure an NOL, when to use it, how to claim an NOL deduction, and how to figure an NOL carryover.

Examples of typical losses that may produce an NOL include losses incurred from the following:
  • Your trade or business.
  • Your work as an employee (unreimbursed employee business expenses).
  • A casualty or theft.
  • Moving expenses.
  • Rental property.

A loss from operating a business is the most common reason for an NOL.


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