Current through Register Vol. 54, No. 19, May 11, 2024
Section 121.13 - Net losses(a) Under the provisions of Article III of the Tax Reform Code of 1971 (72 P. S. §§ 7301-7361) a person shall not be allowed to offset a gain in one class of income with a loss in another class of income. However, a gain may be offset with a loss in the same class of income but limited to the amount of the gain if the income class is one in which net income rather than gross income is reported. For example, if a person experiences a net loss from the sale or exchange of property he shall not enter this loss on Form PA-40 and use this loss to offset income from compensation. However, both gains and losses from the sale or exchange of property may be entered on Schedule D and thus offset part or all of the income in this class.(b) If a person experiences a net loss in an income class he should enter a zero on the appropriate line of Form PA-40.