Some questions concerning NOL carryforward In 2010 I had NOL caused by an item on line 14. I sold the business for a loss, this was reported on 4797. A 1045 Schedule A was filed along with a note to waive the carryback period.
Now it's 2011. According to note on pg 16 of the 2010 Pub. 536, "Report your 2010 NOL from line 25, Schedule A, Form 1045, on the 'other income' line of your 2011 Form 1040..." That sounds easy enough, but regarding carryforwards Pub 536 also says "You must attach a statement that shows all the important facts about the NOL. Your statement should include a computation showing how you figured the NOL deduction..."
So,
1. I guess I'm wanting to know what exactly that means. What are all the important facts that I need to include? Would the 2010 1045, Schedule A suffice? Should I send Table 1. Worksheet for NOL Carroyover From 2011 to 2012 as well?
2. As I mentioned before the business was sold. I have no Schedule C income this year. All income will be from line 7, 8a, and 20a. The standard deduction and personal exemptions could take this taxable income to 0 before the NOL deduction touches it. There's also short term capital loss carryover of 3K from 2010 as well (there are no additional cap gains or loss from 2011). Perhaps, I should have asked this first:
Can the NOL deduction be used to off set wages (line 7 income)?
3. If I do not mention the NOL this year (even though the generation of the NOL was reported for 2010) will I lose it forever?
4. I suspect I will have to report it to keep it, so then will I have to turn in a 2011 1045 schedule A as well to track how the NOL deduction has been used up?
5. Is there anything that I left out?
Thank you so much for reading through this! |