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Hi Sir, I have C corp in NY.For 2011 I have -3310$ net capital

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Hi Sir, I have C corp...
Hi Sir,
I have C corp in NY.For 2011 I have -3310$ net capital loss.What I know is that can be care forward up to next 3 years.For 2011 I can use only to the extend of my capital gain and then deduct it from my corporate profit up to 3000$.But I have a corporate loss.So Turbo tax imported in line 8 of 1120 just nothing.Where I have to put this -3310 to balance the ASSET/LIABILITIES/EQUITY?Retain Earnings may is the right line?Do I have to leave line 8 empty in 1120 and what will be in line 30 of 1120...without this -3310?Little confuse how to balance all that.Thanks in advance
Submitted: 5 years ago.Category: Tax
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3/1/2012
Tax Professional: CGCPA, CPA replied 5 years ago
CGCPA
CGCPA, CPA
Category: Tax
Satisfied Customers: 3,820
Experience: over 40 years experience in tax matters
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Welcome to Just Answer. I am here to help you resolve your tax and finance concerns. Please feel free to ask anytime you need extra help.

 

The balancing entry is recorded in Schedule M-1 on page 5 to reconcile the tax return loss to the book loss. This should then resolve the issue. Also be sure to check the box on page 4 line 11 to waive the loss carry back period.

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Customer reply replied 5 years ago
Hi,
sorry for the delay just was out of the office.Now I am trying again the turbotax but it don't want calculate the capital loss of -3300 as a corporate loss and therefor retain loss.Its showing the number without this -3310$.
Tax Professional: CGCPA, CPA replied 5 years ago

It belongs in Schedule M-1 line 3. You may need to over ride the TurboTax software to get this entered. The problem you have encountered is that software, to be affordable, cannot take into account every situation. Most, however, do provide an over ride feature. If you are not successful with this you will need to contact TurboTax customer support. Here is a link to help you reach them if necessary.

 

 

https://turbotax.intuit.com/support/contact/

 

 

 

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Customer reply replied 5 years ago
In line 3 i staying defference 3310 and line 1 -3738 so its calculate -428 in line 6 and 10th ..very strange.I was trying to talk with them 3 times this days but took me 45 min every time and in the end they did't solve the problem.If I overwrite the numbers tubotax don't allow me to e-file cost of this errors.Its hard situation.Just I am not sure when I am right when the software.Yesterday I just cancel it and told them that I want my money back.So..Still trying to find the solution.:)Thank you
Tax Professional: CGCPA, CPA replied 5 years ago

Just having this limited information it is difficult to answer you with any assurance. Please provide the following information:

 

Book net income without the capital loss

Book income after the capital loss

Retained earnings beginning of year

Any adjustments to retained earnings during the year

Retained earnings at year end

Any non deductible expenses or non taxable income

Dividends paid during the year

 

Having this I should be able to assist you.

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Customer reply replied 5 years ago
Ok.Thank you.

Book net income without the capital loss -3738 (line 27)
Book income after the capital loss -7048 Capital loss (-3310)
Retained earnings beginning of year (+105)
Any adjustments to retained earnings during the year 0
Retained earnings at year end ( have to be -7048)
Any non deductible expenses or non taxable income 0
Dividends paid during the year 0
Tax Professional: CGCPA, CPA replied 5 years ago

The problem is that you are entering the capital loss in the as a positive rather than as a negative. Change the sign on this entry and it should be corrected. Also retained earnings at year end will be as follows:

 

Beginning of year balance 105

Profit (w/o capital loss) -3738

Capital loss -3310

End of year retained earnings -6943

 

I do not see how you have determined year end retained earnings to be -7048, This is a difference of 105. Perhaps you have not taken the opening retained earnings into the equation correctly because that is exactly the difference. After you try this, put it all aside for a day. Sometimes when we deal with a math problem for too long we start to see errors as being correct. It happens to accountants too.

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Customer reply replied 5 years ago
Yep in my balance sheet the sign is minus.But and retained earnings are -6943.That's correct.It was my mistake above:).But the problem is that turbo tax put 0 or nothing in line 8.So then after the retained earning going to -3633.Thereafter the corporate loss is going without this -3310 ..So the balance sheet going to out of balance by 3310.
Tax Professional: CGCPA, CPA replied 5 years ago
Change the sign on the 3310 and you should be alright. If not you can still prepare the return manually (use forms at www.irs.gov for the federal) and mail it in. You may not have the convenience of electronic filing but it will be filed.
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Customer reply replied 5 years ago
The sige is right its minus.Just the question is is it right to put in line 8 the amount of -3310 or turbo tax is right to put there nothing..
Ok thank you very much

Ivo Daskal
Tax Professional: CGCPA, CPA replied 5 years ago
This is the correct place to put the amount. Changing the sign will only help correct a situation for which the TurboTax program is not equipped to deal with.
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Customer reply replied 5 years ago
When I change the sign get very different number.The problem is maybe that the deduction limit for capital loss is 3000 per year, but I dont have capital or operating gain to be subtract from and the software dont allow me to use it in 2011.Strange because that lead the balance sheet out of balance.I dont know I purchased this turbo tax:)Hope to get my money back to get quickbooks.Hope that will work better:))
Tax Professional: CGCPA, CPA replied 5 years ago

The loss limitation has no bearing on this.It is just a math problem.

 

Quickbooks is not a bad program but there are other low cost tax prep programs with, perhaps, more flexibility than TurboTax.Take a look at www.taxact.com One more pointer, if assets and revenues are less than $250,000 you are not required to submit balance sheets or schedules M with the return. Perhaps you can overcome your problem with that exception.

 

Otherwise please put this aside and we can get back to it tomorrow. Then things will be clearer and you will be flustered by this.

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