How Do I Enter a Capital Gain Loss on My 2012 Income Tax Return

There are many times that I am asked how do I enter a capital gain loss on my income tax return. As a CPA who does over one hundred taxes a year, I help many people fill out their income tax returns. Many of them have many gains and losses that they must report and pay income tax on the amounts that they have received income tax forms for.

These amounts must be reported on the 1040 income tax return Schedule D. An important fact that most people do not realize is that these gains and losses are combined and that a loss is limited to three thousand dollars each year. If the amount of the loss is great than that amount, then the amount must be carried forward to subsequent years. However, there is no limitation to the number of years that this carry forward amount may be used.

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