Investments · IRC §1211(b) & §1212(b) · Schedule D
Capital Loss Carryover Calculator
Net your short-term and long-term results, apply the $3,000 ordinary-income limit ($1,500 married filing separately), and see the exact carryforward the official Capital Loss Carryover Worksheet produces — including the low-income case where more of the loss survives to next year.
How much capital loss can I deduct, and how much carries forward?
Your Schedule D net loss is $6,000. You may deduct $3,000 against ordinary income this year (limit $3,000), leaving $3,000 short-term and $0 long-term to carry forward.
- Losses offset unlimited capital gains, then up to $3,000 of ordinary income
- $1,500 limit if married filing separately
- Short-term loss is applied to the $3,000 before long-term
- Carryforward keeps its short-term / long-term character and never expires
- Low or negative taxable income means MORE of the loss carries forward
Source:IRS Schedule D Instructions — Capital Loss Carryover Worksheet
Filing status
Married filing separately halves the ordinary-income allowance to $1,500.
This year's gains and losses
Prior-year carryovers
Filing separately after a joint return? A carryover from the joint return can be used only by the spouse whose sales produced the loss. Enter only your share (Schedule D instructions). Filing jointly after separate returns? Combine both spouses' carryovers.
Excluded canceled debt from income this year because of bankruptcy, insolvency or qualified farm debt? The excluded amount reduces tax attributes in a set order: a net operating loss and certain credits first, then this year's net capital loss and your capital loss carryovers, dollar for dollar (IRC §108(b); see IRS Pub. 4681 and Form 982). This calculator does not make that reduction.
Taxable income before the capital-loss deduction
This is Form 1040 line 15 with the Schedule D loss added back — income after your standard or itemized deduction, before the capital-loss deduction. Leave blank if you do not know it.
Result
Deduction against ordinary income (Sch D line 21)
$3,000
$3,000 short-term · $0 long-term
Capital Loss Carryover Worksheet, line by line
This is the worksheet from the Schedule D instructions, filled in with your figures. Line 4 is the part of the loss your taxable income can actually absorb — when it is less than line 2, more of the loss survives into next year.
| Line | Description | Amount |
|---|---|---|
| 1 | Taxable income from Form 1040 line 15 (after the loss) | $77,000 |
| 2 | Loss from Schedule D line 21, as a positive amount | $3,000 |
| 3 | Combine lines 1 and 2 (zero or less → 0) | $80,000 |
| 4 | Smaller of line 2 or line 3 — the loss your income absorbs | $3,000 |
| 5 | Net short-term loss (Sch D line 7), as a positive amount | $10,000 |
| 6 | Any gain from Schedule D line 15 | $4,000 |
| 7 | Add lines 4 and 6 | $7,000 |
| 8 | Short-term capital loss carryover (line 5 − line 7) | $3,000 |
| 9 | Net long-term loss (Sch D line 15), as a positive amount | $0 |
| 10 | Any gain from Schedule D line 7 | $0 |
| 11 | Line 4 − line 5 (zero or less → 0) | $0 |
| 12 | Add lines 10 and 11 | $0 |
| 13 | Long-term capital loss carryover (line 9 − line 12) | $0 |
Frequently asked questions
- How much capital loss can I deduct in one year?
- After your capital losses offset all of your capital gains, up to $3,000 of the remaining net loss offsets ordinary income each year — $1,500 if you file married filing separately (IRC §1211(b)). Anything left over carries forward indefinitely under §1212(b).
- Does a capital loss carryover expire?
- No. For individuals, an unused capital loss carries forward indefinitely until it is used. It does not expire, but it also cannot be carried back. The carryover keeps its short-term or long-term character.
- Why is my carryover bigger than loss minus $3,000?
- Because the Capital Loss Carryover Worksheet in the Schedule D instructions limits how much of the loss your taxable income can actually absorb. If your taxable income before the deduction is small or negative, less of the loss is consumed and more carries forward — even though Schedule D still shows the full allowable deduction.
- Is short-term or long-term loss used first against ordinary income?
- Short-term. Schedule D applies net short-term loss against the $3,000 ordinary-income allowance before any net long-term loss, which is generally favorable because short-term losses would otherwise offset gains taxed at ordinary rates.
Related tools & guides
Related Tools & Guides
Sources & References
Primary references used for this content
Instructions for Schedule D (Form 1040) — Capital Loss Carryover Worksheet
The official worksheet implemented by this calculator
View on irs.gov
Capital Gains and Losses
The $3,000 / $1,500 limit and the indefinite carryforward
View on irs.gov
Investment Income and Expenses
Netting rules and the character of carried-forward losses
View on irs.gov
✓3 primary sources; links re-checked on a weekly rotation by the source watcher
Disclaimer: This calculator provides estimates for educational purposes only. Not tax, legal, or financial advice. Results may vary based on your specific circumstances. Consult a qualified CPA or tax professional for personalized guidance.