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QUESTION DETAIL
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I'm retired and receive $11,000 in social security income per year. Last year I accumulated $5,000 in capital losses and this year have a $300 capital loss. Does $3,000 of my capital loss from the prior year have to be offset against my $11,000 in social security income even though that income isn't taxable? I'm trying to preserve my carryforward losses.
ANSWER
Expert Eugene Jaspan's Answer:
If you have any taxable income, you would need to apply the $3,000 capital loss against it. Since none of your Social Security Income is taxable (and I'm assuming you have no other taxable income), you can preserve the carryforward loss to a year when you do have such income.
Cordially,
Gene Jaspan, CPA
