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In 2013 I sold my condo at a loss. The amount I could deduct was limited to $3,000. For how many additional years can I deduct part of that loss?

I tried to find this on irs.gov but they drowned me in fine print.


Thanks in advance

Reader99
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In 2013 I sold my condo at a loss. The amount I could deduct was limited to $3,000. For how many additional years can I deduct part of that loss?

The capital loss carryover lasts until it's used up or you die. Each year the carryover from the prior year goes on Schedule D, where it gets netted with any current year gains/losses.

But I'm wondering. Most people mean "my home" when they say "my condo." Was this your personal use property or a rental? If the former you cannot deduct your loss at all. If it was a rental and you did your own return, are you sure you completed everything correctly, including the depreciation recapture?

Phil
Rule Your Retirement Home Fool
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It was my personal home
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Hmm, it was my personal home but it was in a condo-tel and most of the units there are owned by investors or the owners use them as vacation homes. Just so happened I was willing to live in 398 sq feet in a hotel building. Maybe that's why my return went through for 2012 with the loss on it, because of the nature of the property itself.
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Maybe that's why my return went through for 2012 with the loss on it, because of the nature of the property itself.

Just because a return goes through one year, does not mean it will not boomerang back at you another, this time with penalties and interest. I would file an amended return getting rid of the loss and paying the extra taxes.

IP
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I went back and looked at last year. If I hadn't put in the capital loss my taxable income would have been only %59 more than with it. The only reason I bothered to file the Sched D was in case in future years the carry over loss might have benefited me. I'll certainly omit it in future years, of course. Right now I don't have the energy to amend for a possible $8 change in taxes. Maybe next tax season.


Thank all!

Reader99
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So how much is it with interest and penalties ?
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Just because a return goes through one year, ...

I absolutely agree with that.
For that matter has the IRS even really started sending out letters for 2012 or doing in depth audits?
Isn't today the last day to file a 2012 return (with extension)?
I thought I saw posts on here around March 2013 about IRS letters due to 2011 tax forms.
So "goes through" probably just means that it made it past the "did he do his arithmetic correctly?" checks - not that it isn't still subject to "please provide documentation for item X on your return"

If it were me, I'd file the amended return and pay the $10 (or whatever)

Yeah it sucks that you don't get to take the loss as a deduction - but look at it this way - you wouldn't have had to pay taxes on any gains <$250K either.
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Maybe that's why my return went through for 2012 with the loss on it, because of the nature of the property itself.

No, your return went through initial processing because there weren't any math errors on it. No analysis is done of it in initial processing unless something "looks funny." This situation wouldn't qualify.

However, once the computers start looking at filing history and see no Schedules E on your prior returns, no 4797 reporting the sale, etc., they could well get curious.

You need to amend your return. Capital losses on personal residences are not allowed. There's even a special code for reporting the sale.

Phil
Rule Your Retirement Home Fool
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So how much is it with interest and penalties ?

If the additional tax is $8 interest likely won't round to a dollar. There is no penalty, as I recently explained in another thread.

Actually, I agree with OP now that I have the full picture. I wouldn't bother amending either.

Phil
Rule Your Retirement Home Fool
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