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so it is better to run out the capital loss at 3k per year than to offset the loss with gains that would not be taxed anyway.

Except you don't have a choice. Capital loss carry forwards are used to offset any and all capital gains first, and only after that do you use any additional losses to offset ordinary income @ $3k/year. So if you've already sold the property, the capital loss will be used towards that gain first. If you haven't already sold the property, then you can continue to use the carry forward to offset ordinary income at $3k/year, after any other capital gains have been accounted for.

That said - capital loss carryforwards are accounted for on Line 7 of your 2020 1040 https://www.irs.gov/pub/irs-pdf/f1040.pdf - before your AGI is calculated. Your AGI is calculated on Line 11 of your 2020 1040.

AJ
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