Loss Carryback

4 replies
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I have an individual loss carry back from 2018 back to a 2015 under the new law. 2015 has sizable tax interest and penalty due. Will the interest and penalty also be reduced besides the tax from the carryback? Thanks for any response.

Lacerte Tax

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sjrcpaAnswer

Level 15

On a carryback claim, interest and penalty on the original return are not recalculated. Only the tax gets recalculated.

The more I know the more I don’t know.

sjrcpa

Level 15

No. Only the tax gets recalculated.

Or - are you saying 2015 has not been filed yet? In that case, interest and penalty will be calculated on tax due after the carryback.

The more I know the more I don’t know.

M

Michael-G--Ellis-CPAAuthor

Level 3

Thanks for the reply. I don't understand the response. 2015 is already filed, but if I was only filing 2015 now with tax due and then had a 2018 carry back, this would be a better result vs. already having filed it. I researched it since and I'm not seeing a difference in outcomes.

sjrcpaAnswer

Level 15

On a carryback claim, interest and penalty on the original return are not recalculated. Only the tax gets recalculated.

The more I know the more I don’t know.

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