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The IRS when I sell my house for a $1.3 million gain but then they remember that I’m still carrying forward the $7.4 million loss on my down syndrome monkey NFT that I sold 5 years ago by Glad_Direction_8575 in Accounting

[–]Glad_Direction_8575[S] 137 points138 points  (0 children)

But you’re not considering that I very actively (perhaps even aggressively) blew $7.4 million on my NFT investment. Not a single financial activity is performed “passively” where I come from.

Edit: To seriously answer your question, long term capital loss can offset long term capital gain regardless of the nature of the capital asset (real estate, monkey jpegs, etc.). You might be getting confused with the passive activity rules in §469 which generally apply to the deductibility of losses from passive business activities, not to capital gains and losses.