Application of prior losses on 1120-F

[bigrandy]

I have previously filed 1120-F return for a foreign Corp.

I recorded rental losses in the 2002 & 2003 years of $77000 and my beginning capital account in 2004 on the 1120-F shows approximately the same.

In 2004 I have rental income of $38,000. After this income my capital account is still negative $39,000.

My question is, when doing the 2004 1120-F, where do I show the application of prior years losses to eliminate the profits for 2004. I am assuming losses do carry forward as in Canada. Is there a specific form to fill out?

Or, does the IRS automatically apply at thier end.

Regards,
Randy

[Carson]

I have previously filed 1120-F return for a foreign Corp.

I recorded rental losses in the 2002 & 2003 years of $77000 and my beginning capital account in 2004 on the 1120-F shows approximately the same.

In 2004 I have rental income of $38,000. After this income my capital account is still negative $39,000.

My question is, when doing the 2004 1120-F, where do I show the application of prior years losses to eliminate the profits for 2004. I am assuming losses do carry forward as in Canada. Is there a specific form to fill out?

Or, does the IRS automatically apply at thier end.

Regards,
Randy

Page 3, line 30a. Check the instructions and related publications on the IRS website though. No, the IRS will not automatically apply losses. That is up to you to do within the rules.