Have a question about carryover short term vs long term capital loss

You will find that, as the Schedule D reporting of capital gains is worked through, there comes a point where you are directed to _combine_ the results of the short- and long-term sections. That _combining_ will result in your long-term loss offsetting the smaller, short-term gain. The remaining long-term loss will be carried forward (and you should take care to make special note, so it is "remembered" when the next year's return is prepared). As the long-term loss carryover is worked down -- with at least $3,000 useable each year, even against ordinary income

-- it may offset either/or short- and long-term gains. If, however, at some point the loss carryover is _less_ than either the long-term or the combined short- and long-term gains, then it will be used _first_ to reduce the long-term gain. Therefore, similar tax-advantaged income is the first offset. Bill

Close. If the above is all you have, the $20K loss is taken as $3K against ordinary income (!) and $17K is carried forward. The sequence is to first net long term losses again long term gains, then short against stort, then netting what remains as I did above. The $17K loss, if you have no further gains will be used up as $3K per year against ordinary income until it's used up. JOE

You also get to use 3K against ordinary income this year, so

Almost. Those two will net to a $20K *long-term* loss. Then $3K of that will be taken against your ordinary income (no choice), leaving a $17K *long-term* carryover to next year.

-- Rich Carreiro snipped-for-privacy@rlcarr.com

You must enter these transactions on Shedule D and take $3,000 of the loss on 1040line 13. Then the remaining $17,000 carries over on the Capital Loss Carryover Worksheet. Yes, your long term loss will offset short term gains if there are no other gains or losses involved. ed

Thank you all for the answers! Much appreciated!