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Old 02-12-2014, 12:20 PM
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Utilization of NOL Carryforward

I have NOL carried forward from year 2009.

I sold a second home (purchased in 2005) in 2013, with some capital gains.

My 2013 tax bracket is 10%, which implies that the long term capital gain from the sale of the 2nd home should not be taxed.

With the long term capital gain, utlizing the 2009 NOL carryforward will reduce the NOL for future years.

I am anticipating that I would likely fall in the 15% tax bracket or higher in 2014.

May I elect to not utilize the 2009 NOL carryforward in the 2013 return? Utilizing it in the 2013 return will lower the amount to carryforward substantially in lieu of the long term capital gain.

I could perhaps benefit more in paying the tax (10% bracket) this year, and to 'save' the 2009 NOL carryforward to future years (anticipating higher tax bracket).



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Old 02-12-2014, 10:15 PM
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Quote:
Originally Posted by [email protected] View Post


#1;I have NOL carried forward from year 2009.

I sold a second home (purchased in 2005) in 2013, with some capital gains.My 2013 tax bracket is 10%, which implies that the long term capital gain from the sale of the 2nd home should not be taxed.

#3;With the long term capital gain, utlizing the 2009 NOL carryforward will reduce the NOL for future years.

I am anticipating that I would likely fall in the 15% tax bracket or higher in 2014.

May I elect to not utilize the 2009 NOL carryforward in the 2013 return? Utilizing it in the 2013 return will lower the amount to carryforward substantially in lieu of the long term capital gain.

I could perhaps benefit more in paying the tax (10% bracket) this year, and to 'save' the 2009 NOL carryforward to future years (anticipating higher tax bracket).
#1;Correct;UNLESS your tax bracket is higher than 15%.

#2;You are unable to choose when to use your NOL. You must factor it into your taxes every year until it is used up

#3;as mentioned above;it is good idea to c/b NOL due to valuable time value of money.



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Old 02-12-2014, 11:47 PM
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Thank you Wnhough - much appreciated!



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