That's not the way I read it. Remember that with capital losses, there's a distinction between short term and long term losses. So there's a question as to which ones to reduce first. If the current year has a long term loss but the oldest carryover loss is a short term loss, you reduce the long term loss first.
The key point is that the rule about applying to the year of discharge is relevant even if you don't actually apply the reduction until the following year. The rule you're quoting defines the order of applying the reduction. The "when" remains the start of the next taxable year. I believe Mr. Fogel makes that clear in the tax attribute article, on page 11.
The key point is that the rule about applying to the year of discharge is relevant even if you don't actually apply the reduction until the following year. The rule you're quoting defines the order of applying the reduction. The "when" remains the start of the next taxable year. I believe Mr. Fogel makes that clear in the tax attribute article, on page 11.
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