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But why will we include previous tax year’s trading profit??
We always start from the final tax year and then we take into the loss i guess ????
Hershey: Brother, for individuals when you are calculating terminal loss it’s a loss for a 12 Months period!!
It was my understanding that it is the final 12 months, but you don’t use months from the year before if they are profits.
Did anyone apply ER to the sale of the business property as an associated disposal?
Nop you have to, yes you are right LIFO basis my typo error..initial year losses i.e. S-72 can be offset via FIFO basis.
While working on the terminal loss in Q1, going through all the comments, I have noticed no one mention about calculating the fiscal year loss as the last period was of 5 Months.As for individuals the terminal loss is calculated for the period of 12 Months.So there require to break the 12 months as 2 Months following the fiscal year and 10 months prior to the fiscal year to calculate the terminal loss.. As there will be (24,500)+3000*7/12 = 22750 will be included in the calculation of terminal loss which will be carry back in 3 years in FIFO Basis and adjusted through income of same trade!!
While working on the terminal loss in Q1, going through all the comments, I have noticed no one mention about calculating the fiscal year loss as the last period was of 5 Months.As for individuals the terminal loss is calculated for the period of 12 Months.So there require to break the 12 months as 2 Months following the fiscal year and 10 months prior to the fiscal year to calculate the terminal loss.. As there will be (24,500)+3000*7/12 = 22750 will be included in the calculation of terminal loss which will be carry back in 3 years in FIFO Basis and adjusted through income of same trade!!