Q: I realized a large long-term stock loss early in 2003 when the capital gain tax rate was still 20 percent. But I had to carry over part of the loss because I had little stock gain in 2003. Do I have to use the loss to offset gain taxed at only 15 percent in 2004? S.T.P., Lake Geneva, Wis.
A: It depends. The tax benefit from the carryover loss depends on the nature of your gains and losses in 2004. For example, if your only gain is a long-term gain, the carryover loss offsets gain that would be taxed at a maximum rate of 15 percent. But if your only gain is a short-term gain, the loss can offset gain that would otherwise be taxed at your regular rate up to 35 percent. Note: The capital loss is carried over indefinitely until it is used up.