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Carryover (loss on sale of rental unit)


ILLMAS

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My brain is toast for the night, I have a client that sold their rental unit in 2016 at a loss of $40k (short sale, 1099-C possibly in the near future), in 2016 they were only able to deduct about $20k of the loss, in 2017 the carryover amount is limited to $18k.  My question, is the loss allowable if they didn’t have any passive income?  

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16 hours ago, ILLMAS said:

My brain is toast for the night, I have a client that sold their rental unit in 2016 at a loss of $40k (short sale, 1099-C possibly in the near future), in 2016 they were only able to deduct about $20k of the loss, in 2017 the carryover amount is limited to $18k.  My question, is the loss allowable if they didn’t have any passive income?  

Yes, it becomes active on disposition. Was it carried over as an NOL?

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