Client has a NOL carryforward. Again this year, a loss. Line 6 On the worksheet to figure current year NOL for nonbusiness deductions, you use the standard deduction and all deductions that might be itemized deductions ? or is it either or? The instructions read like you add them all together, so even if you couldn't itemize, but had church givings and medical expenses, do you add that to the standard deduction for non business deductions?
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NOL Worksheet
It's one or the other. I agree that the language of the instructions is ambiguous. But you are looking at a list of six examples of the types of deductions that belong on line 6. You include those that are applicable to the taxpayer. Among them is the IRA deduction. So if the guy has contributed, or plans to contribute, to a traditional IRA, then you would include the amount actually contributed, to the extent that he is eligible to take such a deduction. But if he didn't contribute, or if the contribution is nondeductible, then you wouldn't include it on line 6.
So if he actually itemizes, then you include "most" itemized deductions. If he doesn't itemize, then you include the standard deduction.
BMKBurton M. Koss
koss@usakoss.net
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The map is not the territory...
and the instruction book is not the process.
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