Form 1120 - Schedule M-1: Line 6 Calculating as Positive for Capital Loss
Updated: 12/10/2012
Article ID: SLN58911
If you have net short-term capital gain (loss) on Line 5 of Schedule D.
Then a loss is displayed as a negative number on line 5 of the Schedule D.
Why is this amount positive on Form 1120 Schedule M-1?
This amount appears as a positive number Form 1120, Schedule M-1, Line 3 due to limitations on excess capital loss over capital gains.
When capital loss is disallowed, the amount is being added back, thus it displays as a positive amount on Form 1120, Schedule M-1, Line 3.
