Carry Forward Capital Losses

[Jstu]

I have some capital losses from 2016, but I would like to apply them to a later tax year. Am I supposed to declare them now when I am filing for 2016, or do I just declare in whatever year I would like to apply them to?

[Gaetan]

Hi Jstu,

 

If you incurred net capital losses in the current year, you can carry back these losses and apply them to the capital gains of the past THREE years.

1- In the "Left side menu on the Interview tab", select "Interview setup".
2- On the right-hand side of the screen, go to the "Investment income and expenses" group, check the Box "Capital gains (or losses) and capital gain history". Also, go to the "Other topics" group, check the Box for "Losses of prior years, carrybacks" and click on "Next" at the bottom of the screen.
3 - Return to the "Left side menu on the Interview tab" and select "Capital Gains (or losses) & ABIL" and enter your capital gains or capital losses and then return to the "Left side menu on the Interview tab" and select "Losses of prior years and carrybacks".
4 - On the screen to the right, scroll down to "Loss carryback" group, choose "T1A - Request for loss carryback (loss which occurred in 2016".
5 - In the page that appears entitled "T1A - Request for current year loss carryback" choose the section that corresponds to your situation and select the year or years for which you want to apply your losses.

The program will generate Federal form T1A as well as  Quebec form TP- 1012.A.

Quebec residents will have  to print form TP- 1012.A, sign it and mail SEPARATELY from other documents, because it cannot be NetFiled, whereas the Federal T1A can be sent via NetFile.

The T1A does not affect the current year's tax return. The CRA and Revenu Québec will re-assess the corresponding year's tax returns based on the information in the T1A or TP-1012. They will issue you a report at a later date.

For more information on this topic, please see the following links

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/lns101-170/127/lss-ddct/menu-eng.html

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns248-260/253/menu-eng.html