I have question about captial loss carried over from previous tax year.

Say if I still have $5000 capital loss carried over into 2014. If during 2014 tax year, I end up with a capital gain of $4000 from my short term investment (selling stocks), would it "cancel out" $4000 from the $5000 loss from previous year? And keep on happening until those $5000 loss are all "cancelled out"?

Thanks

 

Each capital gain & loss is tracked separately on your tax return, so no, you can't assume they'll cancel out.

 

http://www.irs.gov/taxtopics/tc409.html


I'm not an accountant, but, I learned how to use Google at a Holiday Inn Express last night.

 

Capital losses can offset capital gains and 3,000 of capital loss can be offset against ordinary income if memory serves you can carry forward the remainder for 5 years.