Net Operating Loss and Change in Marital Status

If your marital status in the NOL year is different from your marital status in the carryback or carryover year, the spouse who has the NOL can claim it.

If you file a join return, the NOL deduction is limited to the income of the spouse who had the NOL.

Example:

  • You were divorced in 2012
  • You were married for 10 years
  • In 2013 you have an NOL
  • You do not waive the two-year carryback period
  • You and your spouse always filed joint returns

Result:

  • You carry back your 2013 NOL to tax year 2011, You and your and your spouse filed a joint return at that time.
  • You apply the NOL only to your part of the 2011 joint income.
  • After deducting your NOL, you apply the tax rates for married filing jointly.

If a net operating loss was claimed on a joint return, but in the carryback or carryforward year you are not filing jointly with the same spouse, only your allocable share of the original loss may be claimed. See Publication 536.

QuickBooks Self-Employed
For Freelancers and independent Contractors

- Organize your financial data into one central accounting system on the cloud
- Software kept up to date.
- Your data kept secure
- Anytime, anywhere data access.
- Pay your quarterly estimated taxes online.
- Export Schedule C to TurboTax at year-end for faster filing.
- Save up to 50% off QuickBooks Self-Employed. Track every deduction! Start your free trial now!

Have an accounting or bookkeeping question? Email it to me.