The basic formula for calculating net operating losses for an individual taxpayer is to subtract the total tax deductions for the year, including the standard deduction, from adjusted gross income. But the actual calculation is much more complicated. Some types of deductions are not allowed, including: Losses on the sale of capital assets (like buildings, equipment, and vehicles) that are more than capital gains on those assets Exclusions from gains on qualified small business stock nonbusiness deductions greater than nonbusiness income The section 199A deduction for qualified business income The NOL deduction itself