The arithmetic looks simple — a loss compared against a threshold. The part that goes wrong by hand is which year's threshold, and what counts toward the loss in the first place.
| Step | Common mistake by hand | What this calculator does |
|---|---|---|
| 2026 threshold direction | Assumes the 2026 figure rose from 2025's, like almost every other inflation-indexed tax number. | Uses the correct, lower 2026 figures ($256,000/$512,000 vs. 2025's $313,000/$626,000) and flags the reversal explicitly. |
| What counts as the loss | Includes wages, interest, or dividends in the net business loss figure. | Compares only trade-or-business income and deductions against the threshold; other income is what the allowed loss then offsets. |
| Filing-status figure | Guesses at the married-filing-jointly amount instead of using the statutory figure. | Uses the exact doubled MFJ threshold from the statute for the selected year. |
| What happens to the excess | Treats a disallowed loss as simply lost. | Flags it as a net operating loss carryforward, usable against up to 80% of a future year's taxable income. |
| Is anything I enter uploaded anywhere? | N/A | No. The calculator runs entirely in your browser; nothing is sent to a server. |
Assuming the 2026 threshold rose from 2025's, the way almost every other inflation-indexed tax figure does. It actually fell — from $313,000 to $256,000 single/HOH/MFS, and $626,000 to $512,000 MFJ — because OBBBA rebased the indexing formula.
Including wages, interest, dividends, or capital gains in the net business loss figure. Only aggregate income and deductions from your trades or businesses count toward the threshold comparison — other income is what the ALLOWED loss then offsets, not part of the loss itself.
Assuming a joint return doubles automatically without checking — it does, but only because married filing jointly is a genuinely separate, higher figure in the statute, not a rule applied uniformly to every tax threshold. Getting the actual dollar amount wrong for the wrong reason still produces a wrong number.
Treating a disallowed loss as gone rather than carried forward. The excess above the threshold becomes a net operating loss carryforward, usable against up to 80% of a future year's taxable income — not a permanently lost deduction, but also not immediately as valuable as it would have been this year.
No. Neither this calculator nor a by-hand worksheet built from this page computes your business income or deductions, models the QBI-deduction interaction, or values a future NOL carryforward. Both apply the same published federal threshold to the numbers you enter; verify against IRS guidance or a qualified tax professional before relying on either.