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PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4619
Experience:  35 years tax experience, including four years at a Big 4 firm.
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As victims of a Ponzi scheme loss of our life savings, we

Customer Question

As victims of a Ponzi scheme loss of our life savings, we are faced with a huge NOL...the scheme operator was charged with four felonies by the state in April of this year. My husband is in his early eighties. Our income is not large and I am in my last two years of a health care subsidy for ACA until I'm on Medicare at age 65. We tithe at the church where we are on pastoral staff. My questions are: will the NOL carryforward in year TWO on page one of the 1040 affect my MAGI for the health subsidy? And will the NOL affect our ability to make use of our charitable deductions..we have a large amount of carryforward..or will it effectively nullify our use of the standard deduction going forward when we use it? It is several hundred thousand dollars and we make well below $50,000 yearly.
Submitted: 2 years ago.
Category: Tax
Expert:  PDtax replied 2 years ago.
Welcome to the site. I'm PDtax, and will be helping you today. Thanks for asking for me.
I want to review this when I get to the office in the morning before I advise.
Customer: replied 2 years ago.
Okay I have asked questions similar to this but still cannot wrap my head around the way it will all work both on the return itself and also on how it will affect my subsidy after the first year because then it will be listed on page one and not two of the 1040. Also do not understand if it will mean my charitable deductions will no longer be usable or not. Thanks in advance for your help, it has been a very hard year as the person who defrauded us was a longtime member of our church and active in our services. We still are in shock and state investigators have confirmed the money is all gone.
Expert:  PDtax replied 2 years ago.
The MAGI definition for ACA includes NOL carry forwards. You will be able to deduct your excess NOL carryforward in the second and succeeding years until exhausted for ACA purposes.
Thanks for asking at just answer. Positive feedback is appreciated. I'm PDtax.