Form Crf - Net Operating Loss Carry Forward Form (Page 3 of 4) in pdf

INSTRUCTIONS FOR FORM CRF

GENERAL INFORMATION

Line 10: Enter the portion of the federal long term capital

gains excluded from income.

To qualify for a Kansas net operating loss carry

Line 11: Enter the personal exemption claimed on the

forward, a taxpayer must have all of the following: 1) a

Kansas return.

federal net operating loss; 2) a Kansas Individual Income

Tax Return, Form K-40, and supporting schedules on file

Line 12: Enclose a schedule showing the computation of

for the loss year; and, 3) income or loss from Kansas

the nonbusiness deductions in excess of nonbusiness

sources or was a Kansas resident during the loss year.

income for Kansas and enter the result on line 12. The

method of computing the nonbusiness deductions in

Kansas statutes require net operating losses

which are incurred after December 31, 1987, be

excess of nonbusiness income is the same as that used

carried forward until fully used or until ten (10)

for federal purposes. However, the total amount may

years has elapsed, whichever occurs first. A Kansas

differ because income (from Schedule S, Part A) and

net operating loss which is incurred after December 31,

Kansas itemized deductions must be taken into

1987 is not carried back prior to carrying the loss forward.

consideration for the Kansas computation.

For loss years prior to 1988, the loss carryover is limited

Line 13: Do not make an entry on lines 13a, 13b and 13c

to seven (7) years.

in the loss year column.

NONRESIDENTS: A nonresident must determine his net

Line 14: Reduce the loss shown on line 7 by the total of

operating loss as though he were a Kansas resident.

lines 8 through 12. If the result is a negative figure, this

The loss is determined from information on the front of

will be your Kansas net operating loss. Carry the net

Form K-40 and is applied to income in the same manner

operating loss from line 14 to the next succeeding tax

as a resident of Kansas would claim the loss carry forward.

year, Schedule S, Part A.

The information shown on the Kansas nonresident

allocation percentage schedule is not used to determine

SCHEDULE II – KANSAS DISTRIBUTION SCHEDULE

a Kansas net operating loss. Kansas source loss is not

Schedule II is used to determine the amount of loss that

applied to Kansas source income when determining a

is absorbed and the remainder of the loss to be carried to

Kansas nonresident net operating loss.

the next succeeding year. The computations for Schedule

If there was a change in marital status (divorce,

II are essentially the same as those for Schedule I with a

marriage, or death of one of the spouses) between the

few exceptions.

year of the loss and any of the years to which the loss is

carried, see the instructions for Schedule III.

COLUMNS (B) through (K) – Carry Forward Years

There are three basic steps involved in a net operating

Lines 1 through 11: Enter the requested information from

loss carry forward:

the Kansas Income Tax Return, Form K-40, for the

STEP 1: Complete Schedule I to compute the amount of

applicable year. For line 8, the Kansas net operating

the loss.

loss included in line 3 will need to be added.

STEP 2: Carry the loss to the next succeeding tax year

Line 12: The excess nonbusiness deductions are not

(Schedule S, Part A)

added back. Line 12 is left blank for all years except

STEP 3: Complete Schedule II to determine if there is

the loss year.

any remaining loss to be carried to the next carried to the

Line 13a: If the allowable portion of the charitable

next succeeding year.

contributions shown on the federal itemized deductions

STEP 4: Complete a separate CRF for each loss year.

have increased, show the same adjustment as shown

on the federal net operating loss claim on line 13a.

LINE BY LINE INSTRUCTIONS

Line 13b: Enter the loss year that is being utilized (in case

SCHEDULE I – KANSAS COMPUTATION SCHEDULE

of multiple loss years), then enter amounts from that

loss year.

COLUMN (A) – Loss Year

Line 13c: If you are utilizing more than one loss year, enter

Lines 1 through 6: The information to be entered on these

the year(s) and amounts from the additional loss

lines is taken from the front of the completed Kansas

year(s).

Income Tax Return, Form K-40.

Line 14: Enter an amount for the loss year only.

Line 7: Enter the Kansas taxable income from the loss

Line 15: Add amounts on lines 7 through 13 to determine

year. This amount will be a negative figure.

the modified taxable income and enter the result on

Line 8: If you have any prior year net operating loss

line 15 (cannot be less than zero). NOTE: Line 7 may

included in the adjusted gross income, enter this amount

be either a positive or negative amount, while lines 8

on line 8. Because you are reducing the allowable loss

through 13 are usually positive amounts.

shown on line 7 by the amounts shown on succeeding

lines, the amount entered will be a positive figure.

Line 16: This is the unused portion of the net operating

loss. Column B – If the loss exceeds modified taxable

Line 9: Enter the same capital loss that was computed on

income, show the difference on line 16b. Column C –

your federal net operating loss claim as a positive

If the loss exceeds modified taxable income, show

figure.

Form Crf - Net Operating Loss Carry Forward Form Page 3

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