1045

[Patrick Michael]

First time I have had to file a 1045 and it can't be a straight forward one.  Client was single in 2015, the year of the NOL, but MFJ in 2013, the carryback year.  In the carryback year client had wages, a pension and a Sch C that showed a loss.  His wife's only income was from a Sch C business that had a small profit.  A small dividend and small LT capital loss was their only other income and they have two children.

So if I'm understanding it correctly first I have to figure out their respective tax as if they filed separately to determine how much of the MFJ tax after applying the NOL belongs to my client. 

Am I correct in giving each one of the children and splitting the itemized deductions, dividend, and capital loss 50/50 when doing the MFS computations?

Doing this the wife ends up with no taxable income so I assume 100% MFJ tax after applying the NOL belongs to my client.

I  am also a little confused about the "Before carryback" and "After carryback" columns.  Do I use the numbers from the original MFJ return in the "Before" column and the MFJ numbers after deducting the NOL in the "After" column or should I use the client's MFS numbers?

One last question (hopefully).  Since all of the SE tax belongs to the wife do I include that amount on line 25 (SE tax) of the "After" column?

Thanks.