Updated October 18, 2026. Quick answer: Part VIII is the last step for an activity whose whole loss is reported on one form or schedule. Column (a) is the loss, column (b) is the unallowed part from Part VII, and column (c) is what is left to report. Column (c) is the loss allowed for the year.
When to use Part VIII
The instructions say “Use Part VIII for any activity listed in Part VII if all the loss from that activity is reported on one form or schedule” and “no transactions need to be identified separately”. Otherwise use Part IX, covered on the Part IX page. The form titles the Part “Allowed Losses.”
Names and form references
“In Part VIII, enter the name of each activity and the form or schedule and line number on which the loss is reported.” “Identify each CRD from Part VII on a separate line of Part VIII”. The example in the instructions: “You will report all the allowed loss from an activity listed in Part VII on Schedule E.” Schedule E is explained on the Schedule E page.
Where the number comes from
- Column (a): “enter the net loss plus the prioryear unallowed loss for the activity.”
- Column (b): “enter the amount from column (c) of Part VII for the activity.”
- Column (c): “Subtract column (b) from column (a).”
The form’s column heads read “(a) Loss”, “(b) Unallowed loss” and “(c) Allowed loss”. Column (a) is figured “by adding the losses in columns (b) and (c) of Parts IV and V” plus any prior-year amount from Part I, line 3. The Part VII figures are on the Part VII page.
A computed illustration, not an IRS example, of the subtraction: a column (a) loss of 5 with a column (b) unallowed loss of 2 leaves 5 minus 2 = 3 in column (c).
Where it goes next
Column (b) is carried forward: “These are your unallowed losses for 2025.” “Keep a record of these amounts so the losses can be used to figure your PAL next year.” Column (c) goes to your return: “These amounts are the losses allowed for 2025 under the passive loss rules.” “Report the amounts in this column on the forms and schedules normally used”. That includes Schedule E, Form 4797, Form 4684 and Form 8949 where the loss belongs. The instructions also point you to Pub. 925 for more information.
Edition and line numbers
This page reads the 2025 Form 8582, Passive Activity Loss Limitations and its 2025 instructions, the current files irs.gov served on 2026-10-18. They are the files for the tax year 2025 return, filed in 2026. The form’s own header says “Attach to Form 1040, 1040-SR, or 1041.” Check the tax year printed on the form you are filling in and use the line numbers on that year’s form, because a different year’s form can number or word its lines differently.
Common mistakes
- Using Part VIII when the loss goes to more than one form. The instructions say to use it only if “all the loss from that activity is reported on one form or schedule”
- Not keeping the column (b) amounts. The instructions say “Keep a record of these amounts so the losses can be used to figure your PAL next year.”
- Mixing up the two result columns. The instructions say column (c) is “Subtract column (b) from column (a).”
Related: Form 8582, Schedule E, Form 4797, Form 8949, and Part VII.
Sources
- Instructions for Form 8582, Passive Activity Loss Limitations (2025): https://www.irs.gov/pub/irs-pdf/i8582.pdf
- Form 8582, Passive Activity Loss Limitations (2025): https://www.irs.gov/pub/irs-pdf/f8582.pdf
Read from the IRS documents linked above on October 18, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.