* Capital losses are a common example. If you sell investments at a loss, those losses can offset capital gains. This strategy, when done intentionally to reduce taxes, is called tax-loss harvesting. If your losses exceed your gains, you can generally deduct up to $3,000 against other income each year. For example, with a $10,000 net capital loss and no capital gains, you could deduct $3,000 this year and carry the remaining $7,000 forward.
* Those losses may save you taxes next year, too. If you have $5,000 in capital gains the following year, the $7,000 loss carryover could offset those gains entirely, leaving $2,000 of losses available under the applicable rules.
* Check your prior-year tax return. It may contain unused losses or deductions that could reduce your current-year taxes. Using the same tax software may make this easier because carryovers can transfer automatically, but you should still verify that they’re included.

Bottom Line: A deduction you can’t use this year isn’t necessarily lost forever. Capital losses are just one example. Certain business losses, charitable contributions, and other deductions may also carry forward. Reviewing your prior-year tax return can help ensure you don’t leave valuable tax benefits on the table.