Members of the Maryland Association of Certified Public...

Tax questions

February 28, 1997

Members of the Maryland Association of Certified Public Accountants are answering readers' tax questions through April 15.

Q. A few years ago I had a large loss, and since then have been deducting $3,000 a year long-term capital loss on Schedule D. Now I have to report a capital gain by a mutual fund I own. Do I record that in the same section of Part II? It said you record it under long-term capital gains and losses. Does that go into the same section? Do I subtract my gain from my loss and just record the balance?

A. Your are correct in determining that any capital gain distribution paid to you during the year should be reported on Schedule D, Part II, Line 14 of your 1996 Form 1040. However, do not report just the balance. The capital loss carryover should be reported in Part II, Line 15 of this schedule. The capital gain distributions you received may allow you to deduct more than $3,000 of your loss carryover from prior years. However, if you still have a carryover, consult the capital loss carryover worksheet.

The above advice is for general purposes only and is not intended as legal, accounting or tax advice. Specific situations may vary.

To ask a tax question, call Sundial at (410) 783-1800. Call 268-7736 in Anne Arundel County, 836-5028 in Harford County and 848-0338 in Carroll County. Using a Touch-Tone phone, punch in the four-digit code 6225 after you hear the greeting.

Readers also can e-mail questions through The Sun's Web site --

Selected questions will be answered in the Business section. No questions will be answered by phone.

Pub Date: 2/28/97

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