Question

California Schedule E worksheet, where do I record the last years passive losses carryover?

Forum|Forum|6 years ago
June 6, 2019
4 replies
0 views

TurboTax Live Premier Online

Passive loss carryovers are not reported on the Schedule E. They are reported on the federal Form 8582 and on the California Form 3801.

To enter the information, do the following if you have 2017 passive loss carryovers for California:

You should make sure that such amounts are entered in the TurboTax/California (TT/Calif) activity.
Go to that activity (rental, k-1, etc.) and Edit it.
You will be asked if you have any carryovers associated with that activity. Select Yes and you will then have the opportunity to enter them.

The amounts are usually transferred in from your prior year TT/Calif return, but you must enter them if using TurboTax for the first time.

The above instructions were contributed by TurboTaxTerry with modifications.

S

simba

Turbotax for california never transfered from previous year passive losses for real estate. For the last 7-8 years I always had to enter manually by looking at at previous return. This should be fixed.

K

KingFisher100

On 2023 TurboTax Home and Business, under the real estate income section related to the California return, there was a question about whether there are carried over passive losses from 2022 (the question about losses was embedded in a list of items, any one of which would require you to respond yes). You need to answer yes, and then TurboTax shows you what it thinks the passive losses were based on last year's filing and you can check them. The carryover number is imported from Part 1, Section 1b of the 2022 CA Form 3801. If you don't answer yes, then there will an adjustment to Part 1, Section B, Item 5, Column C of Form CA (540). When you answer yes, then that adjustment should clear if the Federal allowed loss from Form 8582 (reflected in Part 1, Section B, Item 5, Column A of Form CA (540)) is the same as the California allowed loss.

R

rhfrank

I have been using TT for many years. Until TT2020 the prior year passive losses on Fed form 8582 were correctly transferred to CA form 3801. They are not transferred for 2020, and I cannot find a way to enter them. How do I fix this situation?

M

mglauner

Try this suggestion from Employee @TerryA:

"If you have passive loss carryovers for Calif purposes on an activity you should make sure that such amounts are entered in the TT/Calif activity.

Go to that activity (rental, k-1, etc.) and Edit it. You will be asked if you have any carryovers associated with that activity. Select Yes and you will then have the opportunity to enter them."

R

rhfrank

This is only if you have not used TT or had a previous year passive loss. Otherwise the passive loss should transfer from your previous year TT file during import. TT2020 has a possible import glitch, see @rhfrank

U

ucjade

Turbo tax has programming bug in prior year loss carryover in CA. I have to delete the auto-filled number and manually enter the correct one.

R

rhfrank

See my post for the fix @rhfrank

A

aywkwok

I have exactly the same problem for TT2023. It did not import prior year (2022) unallowed losses to CA 3801. However do I fix this problem?

M

MonikaK1

It depends on why the information doesn't appear on CA Form 3801. Federal Form 8582 information should flow through to the California return automatically unless some of the losses were calculated differently due to differences between Federal and California law, or if you are a nonresident of California.

Please see the California Instructions for Form FTB 3801, Passive Activity Loss Limitations, for information on the areas where California law differs from Federal law.

California has different rules for some items affecting rentals, such as depreciation. TurboTax will carry the Federal adjusted gross income to the California return, but you should review the rental in the California return and answer the questions and review the passive and at-risk carryovers. If you depreciated the rental in 2023 using TurboTax, the figures should carry over to 2024.

California does not have forms or schedules comparable to federal Schedules C, E, or F. Each passive activity that has no comparable California form or schedule should be listed on the California Adjustment Worksheet corresponding to the federal schedule where it was reported.

Be sure to go through all of the screens in the California interview to identify all areas that need adjustment due to differences with Federal law.