Capital gain and capital loss

This discussion clarifies that capital losses, whether short-term or long-term, cannot be directly deducted from salary income when filing your tax return. Losses can only be offset against capital gains. Short-term capital losses can be set against both short-term and long-term capital gains, while long-term capital losses can only be offset against long-term capital gains. Losses can be carried forward to future tax years, but you must report them in your current year's return to do so.