Nol

[TAX]

I prepared 2008 tax return for a client (form 1040). Here are some details from 2008 return


Line 21: Other Income (NOL) = -112,143
Line 22; Total Income: (375,191)
Line 37: AGI (379,191)
Line 41: (393,399)
Line 43: Tax = 0

Federal Carry over worksheet in proseries - 2008

Line 14a = NOL CF = 375,615 in 2008 column

What should I take as NOL for 2009?

I switched from Proseries to Drake in 2009

Thanks!

[okie1tax]

Nol

You have to work the 2009 1045 Schedule A to determine 09 NOL.

[Maribeth]

I prepared 2008 tax return for a client (form 1040). Here are some details from 2008 return

Line 21: Other Income (NOL) = -112,143
Line 22; Total Income: (375,191)
Line 37: AGI (379,191)
Line 41: (393,399)
Line 43: Tax = 0

Federal Carry over worksheet in proseries - 2008

Line 14a = NOL CF = 375,615 in 2008 column

What should I take as NOL for 2009?

Thanks!

Okay, you have an NOL carryforward from a year prior to 2008. You need to determine how much of that NOL was used in 2008. In order to do that, you will need to fill out Schedule B on Form 1045 in order to calculate your intervening year calculation. Schedule B should have been filled out BEFORE you prepared the 2008 tax year and whatever the amount used should have been on line 21, not the full amount of the NOL carryforward.

You will use the same procedure to calculate the 2009 NOL used. It is the intervening year calculation. You prepare the tax return first, without any NOL. Then you prepare Schedule B on F1045 to get the amount used, you put that on line 21, and complete the return.

We are all seeing many nol's now, with the economy being what it is. And those NOL's are not being all used up in the current year. The IRS says that only the amount of the NOL that is currently being used must be on line 21. The intervening year calculation must be made.

CFS tax tools has the nol worksheets and does a fine job of calculating it also, if you don't wish to use the actual form.

Maribeth

I switched from Proseries to Drake in 2009