NOL Carryforward

[Kea]

I have a new client that had an NOL last year. She (or her previous tax preparer) elected to forgo the carryback.

I'm not sure the proper way to bring this into the 2008 TaxWise program. I added a 1045 and entered the NOL amount in the blank near the top of the Schedule B page.

On the 1040, line 21, I linked from the "Type" line to a scratch pad and entered "2007 NOL carryforward" and the amount. Is this the proper place to put it? The red instructions mention NOL statements and a place to manually enter an amount (which actually tells you to manually enter on the statement). I'm not sure where this statement is.

Where do I need to enter info, and where will the software carry it? Even though I have the basic info on 1045 Schedule B, it looks like I may have to do some manual calculations. (Not sure, I haven't verified all entries yet.)

Thanks

[Kea]

I tried inputting this return in the 2006 ATX program since it has a category for line 21 input that includes NOL carry forward. It does not generate a 1045. The taxable income before the $11K NOL was $49K, so there is not need to carry to 2009 tax return. Do I need to file the 1045 Schedule B in this case?

I am concerned about filing it. TaxWise shows the taxable income before NOL (line 2 of Schedule as the "current taxable income" (with NOL) + the amount of the NOL. It does not adjust for the difference in the taxable portion of the Social Security income nor does it adjust the amount of the estimated sales tax (which is based on income). I've only done NOL carry backs before and not carry forwards, so I'm a little unsure of these adjustments. But if the 1045 Schedule B isn't filed, it's a moot point.

Thanks

[David1980]

You don't need to file the 1045 even if there is a carry forward. Form 1045 is just used to carry the amount back. It's often used in software to calculate the NOL amount as well, but is not filed when use d for that purpose.

So if you know the amount all that needs to happen is it needs to be a negative amount entered on line 21 of the 1040.

[Kea]

Thanks, that makes life easier. BTW, can you tell from their instructions which blank on line 21 they want me to use? It mentions an NOL statement, but I don't see it. Even when I use the 1045 Sch B, it doesn't feed to the line 21. If I just use the scratchpad, that doesn't tell the software what the entry is for. I guess that doesn't matter in this case - but it might if I needed to carry forward again and I wanted the software to do that.

Thanks