diff --git a/changelog.d/split-capital-loss-carryover-k1.added.md b/changelog.d/split-capital-loss-carryover-k1.added.md
new file mode 100644
index 00000000000..07a373c11b4
--- /dev/null
+++ b/changelog.d/split-capital-loss-carryover-k1.added.md
@@ -0,0 +1 @@
+Split the capital loss carryover memo inputs into the person's own carryover and one from a terminated estate or trust (Schedule K-1 (Form 1041), box 11, codes C and D), add a short-term carryover memo, and add the short-term carryover back in Arizona property tax credit household income (ITR 12-1 item (7)).
diff --git a/policyengine_us/data/economic_assumptions.py b/policyengine_us/data/economic_assumptions.py
index 14347e5fb70..184a97f223f 100644
--- a/policyengine_us/data/economic_assumptions.py
+++ b/policyengine_us/data/economic_assumptions.py
@@ -30,6 +30,10 @@
     "foreign_tax_credit": DEFAULT_MICRODATA_UPRATING,
     "interest_deduction": DEFAULT_MICRODATA_UPRATING,
     "long_term_capital_gains": "calibration.gov.irs.soi.long_term_capital_gains",
+    # long_term_capital_loss_carryover and short_term_capital_loss_carryover
+    # add their own and estate-or-trust leaves. A dataset that carries either
+    # sum keeps the series its leaves follow.
+    "long_term_capital_loss_carryover": "calibration.gov.irs.soi.long_term_capital_gains",
     "misc_deduction": DEFAULT_MICRODATA_UPRATING,
     "partnership_income": "calibration.gov.irs.soi.partnership_s_corp_income",
     "partnership_s_corp_income": "calibration.gov.irs.soi.partnership_s_corp_income",
@@ -41,6 +45,7 @@
     "self_employment_income": "calibration.gov.irs.soi.self_employment_income",
     "self_employed_health_insurance_ald": DEFAULT_MICRODATA_UPRATING,
     "self_employed_pension_contribution_ald": DEFAULT_MICRODATA_UPRATING,
+    "short_term_capital_loss_carryover": "calibration.gov.irs.soi.short_term_capital_gains",
     "social_security": "calibration.gov.irs.soi.social_security",
     "s_corp_income": "calibration.gov.irs.soi.partnership_s_corp_income",
     "spm_unit_weight": "calibration.gov.census.populations.total",
diff --git a/policyengine_us/system.py b/policyengine_us/system.py
index c4c90688ea2..19032de7bc9 100644
--- a/policyengine_us/system.py
+++ b/policyengine_us/system.py
@@ -1,6 +1,8 @@
 import hashlib
 from functools import lru_cache
 from pathlib import Path
+
+import numpy as np
 from policyengine_core.taxbenefitsystems import TaxBenefitSystem
 from policyengine_us.entities import *
 from policyengine_us.parameters.gov.irs.uprating import (
@@ -217,6 +219,63 @@ def _backfill_state_code_from_str(simulation):
         state_code_str.delete_arrays(known_period)
 
 
+CAPITAL_LOSS_CARRYOVER_SUMS = {
+    "long_term_capital_loss_carryover": (
+        "own_long_term_capital_loss_carryover",
+        "estate_or_trust_long_term_capital_loss_carryover",
+    ),
+    "short_term_capital_loss_carryover": (
+        "own_short_term_capital_loss_carryover",
+        "estate_or_trust_short_term_capital_loss_carryover",
+    ),
+}
+
+
+def _file_capital_loss_carryover_sums(simulation):
+    """File an entered capital loss carryover sum as the person's own carryover.
+
+    Each sum adds the person's own carryover and one from a terminated estate
+    or trust. Core does not uprate a variable that adds others, and a sum
+    entered for anyone in a simulation would otherwise be an input for
+    everyone in it. So, mirroring the ``employment_income`` ->
+    ``employment_income_before_lsr`` moves, a sum entered for a period
+    replaces the leaves entered for that period for each person it is
+    nonzero for: their own carryover becomes the sum, which uprates to later
+    periods as that leaf does, and an estate or trust carryover entered for
+    the period becomes zero. Where the sum is zero, the leaves entered for the
+    period stay, and without any the person's own carryover is zero, as the
+    entered sum was. Leaves entered for other periods are left alone. The sum
+    is then computed from its leaves.
+    """
+    for total, (own, estate_or_trust) in CAPITAL_LOSS_CARRYOVER_SUMS.items():
+        holder = simulation.get_holder(total)
+        for known_period in holder.get_known_periods():
+            amount = holder.get_array(known_period)
+            entered = amount != 0
+            for leaf, value in [(own, amount), (estate_or_trust, 0)]:
+                existing = simulation.get_holder(leaf).get_array(known_period)
+                if existing is None and leaf == estate_or_trust:
+                    continue
+                simulation.set_input(
+                    leaf,
+                    known_period,
+                    np.where(entered, value, 0 if existing is None else existing),
+                )
+            holder.delete_arrays(known_period)
+    if getattr(simulation, "input_variables", None) is not None:
+        names = [
+            name
+            for name in simulation.input_variables
+            if name not in CAPITAL_LOSS_CARRYOVER_SUMS
+        ]
+        for leaves in CAPITAL_LOSS_CARRYOVER_SUMS.values():
+            for leaf in leaves:
+                known = simulation.get_holder(leaf).get_known_periods()
+                if known and leaf not in names:
+                    names.append(leaf)
+        simulation.input_variables = names
+
+
 class Simulation(SPMSimulationMixin, CoreSimulation):
     """
     A simulation of the tax-benefit system for the United States,
@@ -296,6 +355,8 @@ def __init__(self, *args, **kwargs):
             )
             cg_holder.delete_arrays(known_period)
 
+        _file_capital_loss_carryover_sums(self)
+
         # Geography backfill: state_code_str-only input -> state_code enum.
         _backfill_state_code_from_str(self)
 
@@ -556,6 +617,8 @@ def __init__(self, *args, **kwargs):
             )
             cg_holder.delete_arrays(known_period)
 
+        _file_capital_loss_carryover_sums(self)
+
         # Geography backfill: state_code_str-only input -> state_code enum.
         # Datasets carry state_fips, so this only fires for situations that
         # explicitly supply state_code_str.
diff --git a/policyengine_us/tests/core/test_capital_gains_rate_worksheet_properties.py b/policyengine_us/tests/core/test_capital_gains_rate_worksheet_properties.py
index bdd22cb4d58..479959dcf08 100644
--- a/policyengine_us/tests/core/test_capital_gains_rate_worksheet_properties.py
+++ b/policyengine_us/tests/core/test_capital_gains_rate_worksheet_properties.py
@@ -7,7 +7,11 @@
 Port the specialty dependent cohorts from PR #9977's investment-interest
 properties without its Form 4952 calculations. YAML covers policy examples
 and regular tax; Hypothesis covers arbitrary vectorized populations, changes
-to dependents' inputs, and redistribution between the head and spouse.
+to dependents' inputs, and redistribution between the head and spouse. A
+differential checks that entering long_term_capital_loss_carryover as its two
+leaves, the person's own carryover and one from a terminated estate or trust
+(Schedule K-1 (Form 1041), box 11, code D), gives the same worksheet lines as
+entering their sum, as older callers and datasets do.
 
 Each example constructs a small Core system containing the production
 worksheet classes and their inputs, without reconstructing the full US
@@ -38,6 +42,9 @@
 from policyengine_us.variables.household.income.person.capital_gains.collectibles_gain_or_loss import (
     collectibles_gain_or_loss,
 )
+from policyengine_us.variables.household.income.person.capital_gains.estate_or_trust_long_term_capital_loss_carryover import (
+    estate_or_trust_long_term_capital_loss_carryover,
+)
 from policyengine_us.variables.household.income.person.capital_gains.long_term_capital_gains_on_collectibles import (
     long_term_capital_gains_on_collectibles,
 )
@@ -47,6 +54,9 @@
 from policyengine_us.variables.household.income.person.capital_gains.long_term_capital_loss_carryover import (
     long_term_capital_loss_carryover,
 )
+from policyengine_us.variables.household.income.person.capital_gains.own_long_term_capital_loss_carryover import (
+    own_long_term_capital_loss_carryover,
+)
 from policyengine_us.variables.household.income.person.capital_gains.section_1202_gain import (
     section_1202_gain,
 )
@@ -70,6 +80,11 @@
     long_term_capital_gains_on_small_business_stock,
 )
 INPUTS = tuple(variable.__name__ for variable in INPUT_CLASSES)
+# long_term_capital_loss_carryover adds these; an entered sum is used instead.
+CARRYOVER_LEAVES = (
+    own_long_term_capital_loss_carryover,
+    estate_or_trust_long_term_capital_loss_carryover,
+)
 OUTPUTS = (
     "rate_gains_less_losses",
     "capital_gains_28_percent_rate_gain",
@@ -83,6 +98,7 @@ def _simulate(units, *, reverse_members=False):
     system = TaxBenefitSystem(entities=[Person, TaxUnit])
     system.add_variables(
         *INPUT_CLASSES,
+        *CARRYOVER_LEAVES,
         is_tax_unit_dependent,
         unrecaptured_section_1250_gain,
         unrecaptured_section_1250_gain_before_losses,
@@ -124,6 +140,10 @@ def _simulate(units, *, reverse_members=False):
             for name in OUTPUTS
             if name != "rate_gains_less_losses"
         },
+        # Per person, in the order the units list them.
+        "long_term_capital_loss_carryover": simulation.calculate(
+            "long_term_capital_loss_carryover", PERIOD
+        ),
     }
 
 
@@ -262,3 +282,34 @@ def test_vectorized_worksheets_depend_only_on_non_dependents(units):
         np.testing.assert_array_equal(
             results[name][size : 2 * size], expected, err_msg=name
         )
+
+
+@settings(max_examples=60, deadline=None)
+@given(units=UNITS, data=st.data())
+def test_carryover_leaves_give_the_same_worksheets_as_their_sum(units, data):
+    """Differential: each person's long-term carryover entered as its sum, or
+    split at random between the person's own carryover and one from a
+    terminated estate or trust, gives the same carryover and the same worksheet
+    lines. Dependents' carryovers are split too; the worksheets leave them out
+    either way. The two cohorts run in separate simulations: a sum entered for
+    anyone in a simulation is an input for everyone in it."""
+    as_leaves = deepcopy(units)
+    totals = []
+    for unit in as_leaves:
+        people = [unit["head"], *unit["dependents"]]
+        if unit["spouse"] is not None:
+            people.insert(1, unit["spouse"])
+        for person in people:
+            total = person.pop("long_term_capital_loss_carryover")
+            own = data.draw(st.integers(min_value=0, max_value=total))
+            person["own_long_term_capital_loss_carryover"] = own
+            person["estate_or_trust_long_term_capital_loss_carryover"] = total - own
+            totals.append(total)
+
+    summed, leaves = _simulate(units), _simulate(as_leaves)
+    for results in (summed, leaves):
+        np.testing.assert_array_equal(
+            results["long_term_capital_loss_carryover"], totals
+        )
+    for name in OUTPUTS:
+        np.testing.assert_array_equal(leaves[name], summed[name], err_msg=name)
diff --git a/policyengine_us/tests/core/test_capital_loss_carryover_entered_sums.py b/policyengine_us/tests/core/test_capital_loss_carryover_entered_sums.py
new file mode 100644
index 00000000000..a548b27b3b0
--- /dev/null
+++ b/policyengine_us/tests/core/test_capital_loss_carryover_entered_sums.py
@@ -0,0 +1,144 @@
+"""A capital loss carryover sum entered as an input is filed as the person's
+own carryover when a Simulation is built, as employment_income is filed as
+employment_income_before_lsr (``policyengine_us.system``). YAML tests build
+Core simulations, which skip that step, so these run through
+``policyengine_us.Simulation``.
+
+Invariants:
+
+1. Uprating: a sum entered for 2024 grows to later years by the series its
+   leaves follow, as it did when the sum was an uprated input, and gives the
+   same results as entering the person's own carryover for 2024.
+2. People: a sum entered for one person leaves another person's leaves for
+   the same year alone.
+3. Replacement: a nonzero sum entered for a person replaces the leaves entered
+   for that person for the same year; a zero sum leaves them.
+"""
+
+import numpy as np
+import pytest
+from policyengine_core.parameters.operations.get_parameter import get_parameter
+
+from policyengine_us import Simulation
+from policyengine_us.system import system
+from policyengine_us.tools.per_capita_uprating import per_capita_path
+
+BASE_YEAR, LATER_YEARS = 2024, (2025, 2026, 2030)
+TERMS = {
+    "long": per_capita_path("calibration.gov.irs.soi.long_term_capital_gains"),
+    "short": per_capita_path("calibration.gov.irs.soi.short_term_capital_gains"),
+}
+
+
+def _growth(path, year):
+    parameter = get_parameter(system.parameters, path)
+    return parameter(f"{year}-01-01") / parameter(f"{BASE_YEAR}-01-01")
+
+
+def _renter(carryovers: dict, year=BASE_YEAR) -> dict:
+    """An Arizona renter aged 70 whose gains are net of the carryovers."""
+    person = {
+        "age": {year: 70},
+        "rent": {year: 5_000},
+        "long_term_capital_gains": {year: 1_000},
+        "short_term_capital_gains": {year: -500},
+    }
+    person.update({name: {year: amount} for name, amount in carryovers.items()})
+    return {
+        "people": {"head": person},
+        "tax_units": {"tax_unit": {"members": ["head"]}},
+        "households": {"household": {"members": ["head"], "state_code": {year: "AZ"}}},
+    }
+
+
+@pytest.mark.parametrize("term", TERMS)
+def test_entered_sum_uprates_as_its_own_leaf(term):
+    sum_entered = Simulation(
+        situation=_renter({f"{term}_term_capital_loss_carryover": 3_000})
+    )
+    own_entered = Simulation(
+        situation=_renter({f"own_{term}_term_capital_loss_carryover": 3_000})
+    )
+    for year in LATER_YEARS:
+        np.testing.assert_allclose(
+            sum_entered.calculate(f"{term}_term_capital_loss_carryover", year),
+            [3_000 * _growth(TERMS[term], year)],
+            rtol=1e-6,
+        )
+        for name in [
+            f"{term}_term_capital_loss_carryover",
+            "az_property_tax_credit_capital_gains",
+            "az_property_tax_credit",
+            "capital_gains_28_percent_rate_gain",
+            "income_tax",
+        ]:
+            np.testing.assert_array_equal(
+                sum_entered.calculate(name, year),
+                own_entered.calculate(name, year),
+                err_msg=f"{name} {year}",
+            )
+    # The sum is no longer an input; the own leaf holds it.
+    assert f"{term}_term_capital_loss_carryover" not in sum_entered.input_variables
+    assert f"own_{term}_term_capital_loss_carryover" in sum_entered.input_variables
+
+
+@pytest.mark.parametrize("term", TERMS)
+def test_entered_sum_leaves_other_peoples_leaves(term):
+    year = str(BASE_YEAR)
+    simulation = Simulation(
+        situation={
+            "people": {
+                "head": {
+                    "age": {year: 40},
+                    f"{term}_term_capital_loss_carryover": {year: 1_000},
+                },
+                "spouse": {
+                    "age": {year: 40},
+                    f"estate_or_trust_{term}_term_capital_loss_carryover": {
+                        year: 2_000
+                    },
+                },
+                "child": {
+                    "age": {year: 10},
+                    f"own_{term}_term_capital_loss_carryover": {year: 300},
+                },
+            }
+        }
+    )
+    np.testing.assert_array_equal(
+        simulation.calculate(f"{term}_term_capital_loss_carryover", year),
+        [1_000, 2_000, 300],
+    )
+
+
+@pytest.mark.parametrize("term", TERMS)
+def test_entered_sum_replaces_the_persons_leaves(term):
+    year = str(BASE_YEAR)
+    leaves = {
+        f"own_{term}_term_capital_loss_carryover": {year: 1_000},
+        f"estate_or_trust_{term}_term_capital_loss_carryover": {year: 500},
+    }
+    simulation = Simulation(
+        situation={
+            "people": {
+                "replaced": {
+                    "age": {year: 40},
+                    f"{term}_term_capital_loss_carryover": {year: 4_000},
+                    **leaves,
+                },
+                "kept": {
+                    "age": {year: 40},
+                    f"{term}_term_capital_loss_carryover": {year: 0},
+                    **leaves,
+                },
+            }
+        }
+    )
+    for name, expected in [
+        (f"{term}_term_capital_loss_carryover", [4_000, 1_500]),
+        (f"own_{term}_term_capital_loss_carryover", [4_000, 1_000]),
+        (f"estate_or_trust_{term}_term_capital_loss_carryover", [0, 500]),
+    ]:
+        np.testing.assert_array_equal(
+            simulation.calculate(name, year), expected, err_msg=name
+        )
diff --git a/policyengine_us/tests/core/test_uprating_series.py b/policyengine_us/tests/core/test_uprating_series.py
index 7a673d48992..c6ae40bce73 100644
--- a/policyengine_us/tests/core/test_uprating_series.py
+++ b/policyengine_us/tests/core/test_uprating_series.py
@@ -16,6 +16,9 @@
 EMPLOYMENT = per_capita_path("calibration.gov.irs.soi.employment_income")
 SELF_EMPLOYMENT = per_capita_path("calibration.gov.irs.soi.self_employment_income")
 CAPITAL_GAINS = per_capita_path("calibration.gov.irs.soi.long_term_capital_gains")
+SHORT_TERM_CAPITAL_GAINS = per_capita_path(
+    "calibration.gov.irs.soi.short_term_capital_gains"
+)
 ALIMONY = per_capita_path("calibration.gov.irs.soi.alimony_income")
 UNEMPLOYMENT = per_capita_path("calibration.gov.irs.soi.unemployment_compensation")
 DEFAULT = per_capita_path("calibration.gov.cbo.income_by_source.adjusted_gross_income")
@@ -49,7 +52,10 @@
     "self_employed_pension_contributions_desired": SELF_EMPLOYMENT,
     # Components of capital gains.
     "long_term_capital_gains_on_collectibles": CAPITAL_GAINS,
-    "long_term_capital_loss_carryover": CAPITAL_GAINS,
+    "own_long_term_capital_loss_carryover": CAPITAL_GAINS,
+    "estate_or_trust_long_term_capital_loss_carryover": CAPITAL_GAINS,
+    "own_short_term_capital_loss_carryover": SHORT_TERM_CAPITAL_GAINS,
+    "estate_or_trust_short_term_capital_loss_carryover": SHORT_TERM_CAPITAL_GAINS,
     "collectibles_gain_or_loss": CAPITAL_GAINS,
     "section_1202_gain": CAPITAL_GAINS,
     "unrecaptured_section_1250_gain_before_losses": CAPITAL_GAINS,
@@ -158,6 +164,20 @@ def test_rent_override_matches_the_rent_input():
     assert system.variables["pre_subsidy_rent"].uprating == CPI_U
 
 
+@pytest.mark.parametrize(
+    "total", ["long_term_capital_loss_carryover", "short_term_capital_loss_carryover"]
+)
+def test_carryover_sum_override_matches_its_leaves(total):
+    """A carryover sum adds its leaves, so Core cannot uprate it; a dataset
+    column holding the sum follows the series its leaves follow."""
+    leaves = system.variables[total].adds
+    assert len(leaves) == 2
+    for leaf in leaves:
+        assert system.variables[leaf].uprating == per_capita_path(
+            MICRODATA_UPRATING_OVERRIDES[total]
+        )
+
+
 METHODOLOGY_PAGE = (
     Path(__file__).parents[3] / "docs-quarto" / "methodology" / "spm-poverty.qmd"
 )
diff --git a/policyengine_us/tests/microsimulation/data/test_capital_loss_carryover_dataset_inputs.py b/policyengine_us/tests/microsimulation/data/test_capital_loss_carryover_dataset_inputs.py
new file mode 100644
index 00000000000..52e899f2ff1
--- /dev/null
+++ b/policyengine_us/tests/microsimulation/data/test_capital_loss_carryover_dataset_inputs.py
@@ -0,0 +1,147 @@
+"""
+Datasets can carry ``long_term_capital_loss_carryover`` or
+``short_term_capital_loss_carryover`` as a person column. Each now adds two
+leaves: the person's own carryover and one from a terminated estate or trust
+(Schedule K-1 (Form 1041), box 11, codes D and C). Core does not uprate a
+variable that adds others, so ``MICRODATA_UPRATING_OVERRIDES`` gives the sums
+the series their leaves follow, and the simulation files each year's sums as
+the person's own carryover. A dataset carrying the sums must keep them in
+every extended year and give the same results as one carrying the leaves.
+"""
+
+import numpy as np
+import pandas as pd
+import pytest
+from policyengine_core.parameters.operations.get_parameter import get_parameter
+
+from policyengine_us import Microsimulation
+from policyengine_us.data.dataset_schema import USSingleYearDataset
+from policyengine_us.system import system
+from policyengine_us.tools.per_capita_uprating import per_capita_path
+
+BASE_YEAR, LATER_YEAR = 2024, 2026
+SERIES = {
+    "long": per_capita_path("calibration.gov.irs.soi.long_term_capital_gains"),
+    "short": per_capita_path("calibration.gov.irs.soi.short_term_capital_gains"),
+}
+# Per person: the carryover sums and the own part of each.
+CARRYOVERS = {
+    "long": ([3_000.0, 0.0, 1_200.0], [1_000.0, 0.0, 1_200.0]),
+    "short": ([1_000.0, 0.0, 400.0], [0.0, 0.0, 100.0]),
+}
+OUTPUTS = [
+    "az_property_tax_credit_capital_gains",
+    "az_property_tax_credit_income",
+    "az_property_tax_credit",
+    "adjusted_gross_income",
+    "income_tax",
+]
+
+
+def _dataset(carryover_columns: dict) -> USSingleYearDataset:
+    """Two Arizona households: a renter aged 70 whose gains are net of
+    carryovers, and a renter aged 68 with a dependent grandchild who has
+    carryovers."""
+    return USSingleYearDataset(
+        person=pd.DataFrame(
+            {
+                "person_id": [1, 2, 3],
+                "person_household_id": [1, 2, 2],
+                "person_tax_unit_id": [1, 2, 2],
+                "person_spm_unit_id": [1, 2, 2],
+                "person_family_id": [1, 2, 2],
+                "person_marital_unit_id": [1, 2, 3],
+                "age": [70.0, 68.0, 15.0],
+                "is_tax_unit_dependent": [False, False, True],
+                "rent": [5_000.0, 6_000.0, 0.0],
+                "employment_income": [0.0, 2_000.0, 0.0],
+                # Schedule D lines 15 and 7, net of the carryovers.
+                "long_term_capital_gains_before_response": [1_000.0, 0.0, -1_200.0],
+                "short_term_capital_gains": [-500.0, 0.0, -400.0],
+                **carryover_columns,
+            }
+        ),
+        household=pd.DataFrame(
+            {
+                "household_id": [1, 2],
+                "household_weight": [1.0, 1.0],
+                "state_fips": [4, 4],
+            }
+        ),
+        tax_unit=pd.DataFrame({"tax_unit_id": [1, 2]}),
+        spm_unit=pd.DataFrame({"spm_unit_id": [1, 2]}),
+        family=pd.DataFrame({"family_id": [1, 2]}),
+        marital_unit=pd.DataFrame({"marital_unit_id": [1, 2, 3]}),
+        time_period=BASE_YEAR,
+    )
+
+
+def _sums() -> dict:
+    return {
+        f"{term}_term_capital_loss_carryover": totals
+        for term, (totals, _) in CARRYOVERS.items()
+    }
+
+
+def _leaves() -> dict:
+    columns = {}
+    for term, (totals, own) in CARRYOVERS.items():
+        columns[f"own_{term}_term_capital_loss_carryover"] = own
+        columns[f"estate_or_trust_{term}_term_capital_loss_carryover"] = [
+            total - part for total, part in zip(totals, own)
+        ]
+    return columns
+
+
+def _growth(path: str, year: int) -> float:
+    parameter = get_parameter(system.parameters, path)
+    return parameter(f"{year}-01-01") / parameter(f"{BASE_YEAR}-01-01")
+
+
+@pytest.fixture(scope="module")
+def simulations():
+    return {
+        name: Microsimulation(dataset=_dataset(columns), dataset_end_year=LATER_YEAR)
+        for name, columns in [("sums", _sums()), ("leaves", _leaves())]
+    }
+
+
+@pytest.mark.parametrize("year", [BASE_YEAR, LATER_YEAR])
+def test_carryover_sums_from_a_dataset_uprate_as_their_leaves(simulations, year):
+    for term, (totals, _) in CARRYOVERS.items():
+        expected = np.array(totals) * _growth(SERIES[term], year)
+        for simulation in simulations.values():
+            np.testing.assert_allclose(
+                simulation.calculate(
+                    f"{term}_term_capital_loss_carryover", year
+                ).values,
+                expected,
+                rtol=1e-6,
+            )
+
+
+@pytest.mark.parametrize("year", [BASE_YEAR, LATER_YEAR])
+def test_dataset_sums_and_leaves_give_the_same_results(simulations, year):
+    for name in OUTPUTS:
+        np.testing.assert_allclose(
+            simulations["leaves"].calculate(name, year).values,
+            simulations["sums"].calculate(name, year).values,
+            atol=0.01,
+            err_msg=name,
+        )
+
+
+def test_line_d_adds_back_dataset_carryovers(simulations):
+    # ITR 12-1 item (7): the year's own result counts on line D. The first
+    # renter: 1,000 + 3,000 - 500 + 1,000. The grandchild:
+    # -1,200 + 1,200 - 400 + 400.
+    for simulation in simulations.values():
+        line_d = simulation.calculate("az_property_tax_credit_capital_gains", BASE_YEAR)
+        np.testing.assert_allclose(line_d.values, [4_500, 0, 0], atol=0.01)
+
+
+def test_dataset_sums_are_filed_as_own_carryovers(simulations):
+    inputs = simulations["sums"].input_variables
+    for term in CARRYOVERS:
+        assert f"{term}_term_capital_loss_carryover" not in inputs
+        assert f"own_{term}_term_capital_loss_carryover" in inputs
diff --git a/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/capital_gains_28_percent_rate_gain.yaml b/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/capital_gains_28_percent_rate_gain.yaml
index 9444db22c4e..784ff6407aa 100644
--- a/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/capital_gains_28_percent_rate_gain.yaml
+++ b/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/capital_gains_28_percent_rate_gain.yaml
@@ -68,6 +68,75 @@
     # 6,000.
     capital_gains_28_percent_rate_gain: 6_000
 
+# Line 5 is "your long-term capital loss carryovers from Schedule D, line 14;
+# and Schedule K-1 (Form 1041), box 11, code D". A carryover from a terminated
+# estate or trust (26 U.S.C. 642(h)(1), Reg. 1.642(h)-1) reduces the gain as
+# the person's own carryover does.
+- name: A terminated estate or trust's long-term carryover reduces it
+  period: 2025
+  input:
+    long_term_capital_gains: 47_000
+    collectibles_gain_or_loss: 10_000
+    estate_or_trust_long_term_capital_loss_carryover: 3_000
+  output:
+    # Line 5 = (3,000), line 7 = 7,000, as with a 3,000 carryover of the
+    # person's own.
+    capital_gains_28_percent_rate_gain: 7_000
+
+- name: Own and estate or trust long-term carryovers combine on line 5
+  period: 2025
+  input:
+    long_term_capital_gains: 47_000
+    collectibles_gain_or_loss: 10_000
+    own_long_term_capital_loss_carryover: 1_000
+    estate_or_trust_long_term_capital_loss_carryover: 2_000
+  output:
+    # Line 5 = (1,000 + 2,000), line 7 = 7,000.
+    capital_gains_28_percent_rate_gain: 7_000
+
+- name: A short-term carryover memo does not reduce it again
+  period: 2025
+  input:
+    long_term_capital_gains: 50_000
+    collectibles_gain_or_loss: 10_000
+    # Schedule D line 7: the year's net short-term loss of 5,000 plus a 3,000
+    # carryover, 2,000 of it the person's own (line 6) and 1,000 from a
+    # terminated trust's Schedule K-1 (Form 1041), box 11, code C (line 5).
+    short_term_capital_gains: -8_000
+    own_short_term_capital_loss_carryover: 2_000
+    estate_or_trust_short_term_capital_loss_carryover: 1_000
+  output:
+    # Line 6 is the Schedule D line 7 loss, which already holds the
+    # carryovers: 10,000 - 8,000 = 2,000.
+    capital_gains_28_percent_rate_gain: 2_000
+
+- name: Each spouse's carryover leaves count on a joint return
+  period: 2025
+  input:
+    people:
+      head:
+        age: 45
+        is_tax_unit_head: true
+        collectibles_gain_or_loss: 10_000
+        own_long_term_capital_loss_carryover: 1_000
+      spouse:
+        age: 45
+        is_tax_unit_spouse: true
+        estate_or_trust_long_term_capital_loss_carryover: 2_000
+    tax_units:
+      tax_unit:
+        members: [head, spouse]
+        filing_status: JOINT
+    marital_units:
+      filers:
+        members: [head, spouse]
+    households:
+      household:
+        members: [head, spouse]
+  output:
+    # Line 5 = (1,000 + 2,000), line 7 = 10,000 - 3,000.
+    capital_gains_28_percent_rate_gain: 7_000
+
 - name: A collectibles loss offsets section 1202 gain
   period: 2025
   input:
diff --git a/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/schedule_d_unrecaptured_section_1250_gain.yaml b/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/schedule_d_unrecaptured_section_1250_gain.yaml
index c84287acaea..93a0ec1e53a 100644
--- a/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/schedule_d_unrecaptured_section_1250_gain.yaml
+++ b/policyengine_us/tests/policy/baseline/gov/irs/tax/federal_income/capital_gains/schedule_d_unrecaptured_section_1250_gain.yaml
@@ -83,6 +83,19 @@
     # Line 15 = (6,000), line 16 = (1,000), line 17 = 7,000, line 18 = 13,000.
     schedule_d_unrecaptured_section_1250_gain: 13_000
 
+- name: An estate or trust carryover and a short-term loss together
+  period: 2025
+  input:
+    long_term_capital_gains: 49_000
+    unrecaptured_section_1250_gain_before_losses: 20_000
+    short_term_capital_gains: -6_000
+    # Schedule K-1 (Form 1041), box 11, code D, which line 16 takes with
+    # Schedule D line 14.
+    estate_or_trust_long_term_capital_loss_carryover: 1_000
+  output:
+    # Line 15 = (6,000), line 16 = (1,000), line 17 = 7,000, line 18 = 13,000.
+    schedule_d_unrecaptured_section_1250_gain: 13_000
+
 - name: A collectibles loss reduces it
   period: 2025
   input:
diff --git a/policyengine_us/tests/policy/baseline/gov/states/az/tax/income/credits/az_property_tax_credit_income.yaml b/policyengine_us/tests/policy/baseline/gov/states/az/tax/income/credits/az_property_tax_credit_income.yaml
index f1f7d8f85e2..eee2ed64944 100644
--- a/policyengine_us/tests/policy/baseline/gov/states/az/tax/income/credits/az_property_tax_credit_income.yaml
+++ b/policyengine_us/tests/policy/baseline/gov/states/az/tax/income/credits/az_property_tax_credit_income.yaml
@@ -1033,3 +1033,147 @@
     # Line 11b: Schedule 2, 3,851 - 4,000 -> 279.
     # Line 13: 750. Line 15: smaller of 279 and 750.
     az_property_tax_credit: 279
+
+# The carryover memos are sums of leaf inputs: the person's own carryover and
+# one from a terminated estate or trust. Entering the leaves gives the same
+# line D as entering their sum.
+- name: A terminating trust capital loss entered as its own input remains a carryover
+  period: 2025
+  input:
+    people:
+      head:
+        age: 70
+        # Own gains 4,000 less the trust's 3,000 loss transferred in 2025.
+        long_term_capital_gains: 1_000
+        # Final Form 1041 K-1 box 11 code D; d1107 keeps it a carryover.
+        estate_or_trust_long_term_capital_loss_carryover: 3_000
+        rent: 5_000
+    tax_units:
+      tax_unit:
+        members: [head]
+    households:
+      household:
+        members: [head]
+        state_code: AZ
+  output:
+    adjusted_gross_income: 1_000
+    long_term_capital_loss_carryover: [3_000]
+    az_property_tax_credit_capital_gains: [4_000]
+    az_property_tax_credit_agi: 4_000
+    az_property_tax_credit_income: 4_000
+    az_property_tax_credit: 0
+
+- name: Own and terminating trust long-term carryovers are both added back
+  period: 2025
+  input:
+    people:
+      head:
+        age: 70
+        # The year's long-term gain 4,000, net of a 1,000 own carryover and a
+        # 2,000 carryover from a terminated trust.
+        long_term_capital_gains: 1_000
+        own_long_term_capital_loss_carryover: 1_000
+        estate_or_trust_long_term_capital_loss_carryover: 2_000
+        rent: 5_000
+    tax_units:
+      tax_unit:
+        members: [head]
+    households:
+      household:
+        members: [head]
+        state_code: AZ
+  output:
+    adjusted_gross_income: 1_000
+    # Line D: the year's gain 4,000. Line J: 4,000.
+    az_property_tax_credit_capital_gains: [4_000]
+    az_property_tax_credit_income: 4_000
+    az_property_tax_credit: 0
+
+# ITR 12-1 item (7) bars any prior-year carryover, short-term as well as
+# long-term. short_term_capital_gains is Schedule D line 7, net of the
+# short-term carryover on line 6 (own) or line 5 (Schedule K-1 (Form 1041),
+# box 11, code C), so line D adds the memo back.
+- name: A short-term capital loss carryover does not reduce line D
+  period: 2025
+  input:
+    people:
+      head:
+        age: 70
+        # The year's short-term gain is 4,000; a 3,000 carryover nets it to
+        # 1,000 on Schedule D line 7.
+        short_term_capital_gains: 1_000
+        own_short_term_capital_loss_carryover: 3_000
+        rent: 5_000
+    tax_units:
+      tax_unit:
+        members: [head]
+    households:
+      household:
+        members: [head]
+        state_code: AZ
+  output:
+    # Federal AGI uses the carryover: 1,000.
+    adjusted_gross_income: 1_000
+    # Line D: the year's gain 4,000. Line J: 4,000.
+    short_term_capital_loss_carryover: [3_000]
+    az_property_tax_credit_capital_gains: [4_000]
+    az_property_tax_credit_income: 4_000
+    # Line 11a: Schedule 1 pays nothing at 3,751 or more.
+    az_property_tax_credit: 0
+
+- name: A terminating trust short-term loss remains a carryover for line D
+  period: 2025
+  input:
+    people:
+      head:
+        age: 70
+        long_term_capital_gains: 4_000
+        # Final Form 1041 K-1 box 11 code C, on Schedule D line 5: the year's
+        # short-term result is that 3,000 loss alone. Treated like code D
+        # under d1107, pending Max's confirmation (d1512).
+        short_term_capital_gains: -3_000
+        estate_or_trust_short_term_capital_loss_carryover: 3_000
+        rent: 5_000
+    tax_units:
+      tax_unit:
+        members: [head]
+    households:
+      household:
+        members: [head]
+        state_code: AZ
+  output:
+    # Federal AGI: 4,000 - 3,000 = 1,000.
+    adjusted_gross_income: 1_000
+    # Line D: 4,000 - 3,000 + 3,000 = 4,000. Line J: 4,000.
+    az_property_tax_credit_capital_gains: [4_000]
+    az_property_tax_credit_income: 4_000
+    az_property_tax_credit: 0
+
+- name: A dependent's short-term carryover is not a line D loss
+  period: 2025
+  input:
+    people:
+      head:
+        age: 70
+        long_term_capital_gains: 4_000
+        rent: 5_000
+      child:
+        age: 17
+        is_tax_unit_dependent: true
+        short_term_capital_gains: -3_000
+        own_short_term_capital_loss_carryover: 3_000
+    tax_units:
+      tax_unit:
+        members: [head, child]
+    households:
+      household:
+        members: [head, child]
+        state_code: AZ
+  output:
+    # Line D: column 1 gain 4,000; column 3 the year's net 0. Line J: 4,000.
+    az_property_tax_credit_capital_gains: [4_000, 0]
+    az_property_tax_credit_dependent_income: 0
+    az_property_tax_credit_income: 4_000
+    # Line 11b: Schedule 2, 3,851 - 4,000 -> 279.
+    # Line 13: 750. Line 15: smaller of 279 and 750.
+    az_property_tax_credit: 279
diff --git a/policyengine_us/tests/policy/baseline/household/income/person/capital_gains/long_term_capital_loss_carryover.yaml b/policyengine_us/tests/policy/baseline/household/income/person/capital_gains/long_term_capital_loss_carryover.yaml
new file mode 100644
index 00000000000..00cc89238b8
--- /dev/null
+++ b/policyengine_us/tests/policy/baseline/household/income/person/capital_gains/long_term_capital_loss_carryover.yaml
@@ -0,0 +1,55 @@
+# 26 U.S.C. 1212(b)(1)(B) and 642(h)(1): the long-term capital loss carried to
+# the year is the person's own carryover (Schedule D line 14) plus any
+# carryover from a terminated estate or trust (Schedule K-1 (Form 1041), box
+# 11, code D, part of Schedule D line 12).
+- name: No carryover unless entered
+  period: 2025
+  input:
+    age: 40
+  output:
+    long_term_capital_loss_carryover: 0
+
+- name: The person's own carryover
+  period: 2025
+  input:
+    own_long_term_capital_loss_carryover: 3_000
+  output:
+    long_term_capital_loss_carryover: 3_000
+
+- name: A carryover from a terminated estate or trust
+  period: 2025
+  input:
+    estate_or_trust_long_term_capital_loss_carryover: 2_000
+  output:
+    long_term_capital_loss_carryover: 2_000
+
+- name: Own and estate or trust carryovers add
+  period: 2025
+  input:
+    own_long_term_capital_loss_carryover: 3_000
+    estate_or_trust_long_term_capital_loss_carryover: 2_000
+  output:
+    long_term_capital_loss_carryover: 5_000
+
+- name: An amount entered as the sum is used for that year
+  period: 2025
+  input:
+    own_long_term_capital_loss_carryover: 1_000
+    long_term_capital_loss_carryover: 4_000
+  output:
+    # Callers and datasets that enter the sum keep their amount.
+    long_term_capital_loss_carryover: 4_000
+
+- name: Each person's leaves add separately
+  period: 2025
+  input:
+    people:
+      head:
+        own_long_term_capital_loss_carryover: 1_000
+        estate_or_trust_long_term_capital_loss_carryover: 500
+      spouse:
+        estate_or_trust_long_term_capital_loss_carryover: 2_000
+      child:
+        age: 10
+  output:
+    long_term_capital_loss_carryover: [1_500, 2_000, 0]
diff --git a/policyengine_us/tests/policy/baseline/household/income/person/capital_gains/short_term_capital_loss_carryover.yaml b/policyengine_us/tests/policy/baseline/household/income/person/capital_gains/short_term_capital_loss_carryover.yaml
new file mode 100644
index 00000000000..a70b3cc58be
--- /dev/null
+++ b/policyengine_us/tests/policy/baseline/household/income/person/capital_gains/short_term_capital_loss_carryover.yaml
@@ -0,0 +1,54 @@
+# 26 U.S.C. 1212(b)(1)(A) and 642(h)(1): the short-term capital loss carried to
+# the year is the person's own carryover (Schedule D line 6) plus any
+# carryover from a terminated estate or trust (Schedule K-1 (Form 1041), box
+# 11, code C, part of Schedule D line 5).
+- name: No carryover unless entered
+  period: 2025
+  input:
+    age: 40
+  output:
+    short_term_capital_loss_carryover: 0
+
+- name: The person's own carryover
+  period: 2025
+  input:
+    own_short_term_capital_loss_carryover: 3_000
+  output:
+    short_term_capital_loss_carryover: 3_000
+
+- name: A carryover from a terminated estate or trust
+  period: 2025
+  input:
+    estate_or_trust_short_term_capital_loss_carryover: 2_000
+  output:
+    short_term_capital_loss_carryover: 2_000
+
+- name: Own and estate or trust carryovers add
+  period: 2025
+  input:
+    own_short_term_capital_loss_carryover: 3_000
+    estate_or_trust_short_term_capital_loss_carryover: 2_000
+  output:
+    short_term_capital_loss_carryover: 5_000
+
+- name: An amount entered as the sum is used for that year
+  period: 2025
+  input:
+    estate_or_trust_short_term_capital_loss_carryover: 1_000
+    short_term_capital_loss_carryover: 4_000
+  output:
+    short_term_capital_loss_carryover: 4_000
+
+- name: Each person's leaves add separately
+  period: 2025
+  input:
+    people:
+      head:
+        own_short_term_capital_loss_carryover: 1_000
+        estate_or_trust_short_term_capital_loss_carryover: 500
+      spouse:
+        estate_or_trust_short_term_capital_loss_carryover: 2_000
+      child:
+        age: 10
+  output:
+    short_term_capital_loss_carryover: [1_500, 2_000, 0]
diff --git a/policyengine_us/tests/test_az_property_tax_credit_income.py b/policyengine_us/tests/test_az_property_tax_credit_income.py
index b95ffe1b383..dcd1ae23156 100644
--- a/policyengine_us/tests/test_az_property_tax_credit_income.py
+++ b/policyengine_us/tests/test_az_property_tax_credit_income.py
@@ -33,6 +33,13 @@
 4. Schedule floor: the credit depends on line J only through max(line J, 0),
    so a negative line J gets the zero-income schedule amount.
 5. The income does not depend on capital_gains_excluded_from_taxable_income.
+6. Carryover leaves: moving part of a member's short-term result into the
+   short-term carryover memo, which short_term_capital_gains then nets as
+   Schedule D line 7 does, leaves line J unchanged (ITR 12-1 item (7)).
+   Entering each carryover memo as its leaves, split at random between the
+   member's own carryover and one from a terminated estate or trust (Schedule
+   K-1 (Form 1041), box 11, codes C and D), gives the same Arizona and federal
+   results as entering the sum.
 """
 
 import numpy as np
@@ -492,3 +499,78 @@ def formula(tax_unit, period, parameters):
     np.testing.assert_allclose(
         sim.calculate("az_property_tax_credit", YEAR), [502], atol=0.01
     )
+
+
+def _with_short_term_carryovers(units: list, rng: np.random.Generator) -> list:
+    """The units with part of some members' short-term result entered as a
+    short-term capital loss carryover, which short_term_capital_gains nets, as
+    Schedule D line 7 does. Each member's year's own net gain is unchanged."""
+    changed = []
+    for unit in units:
+        members = []
+        for member in unit["members"]:
+            member = dict(member)
+            carryover = round(rng.uniform(0, 4_000), 2) if rng.random() < 0.3 else 0.0
+            member["short_term_capital_gains"] = round(
+                member["short_term_capital_gains"] - carryover, 2
+            )
+            member["short_term_capital_loss_carryover"] = carryover
+            members.append(member)
+        changed.append({**unit, "members": members})
+    return changed
+
+
+def _as_leaves(units: list, rng: np.random.Generator) -> list:
+    """The units with each carryover memo entered as its leaves: part the
+    member's own carryover, the rest from a terminated estate or trust."""
+    changed = []
+    for unit in units:
+        members = []
+        for member in unit["members"]:
+            member = dict(member)
+            for term in ["long", "short"]:
+                total = member.pop(f"{term}_term_capital_loss_carryover")
+                own = round(total * rng.random(), 2)
+                member[f"own_{term}_term_capital_loss_carryover"] = own
+                member[f"estate_or_trust_{term}_term_capital_loss_carryover"] = round(
+                    total - own, 2
+                )
+            members.append(member)
+        changed.append({**unit, "members": members})
+    return changed
+
+
+def test_carryover_leaves_match_their_sums():
+    rng = np.random.default_rng(SEED + 2)
+    summed_units = _with_short_term_carryovers(UNITS, rng)
+    leaf_units = _as_leaves(summed_units, rng)
+    members = [m for unit in summed_units for m in unit["members"]]
+    assert sum(m["short_term_capital_loss_carryover"] > 0 for m in members) >= 20
+    assert any(
+        m["short_term_capital_loss_carryover"] > 0 and m["role"] == "dependent"
+        for m in members
+    )
+    # The two cohorts run in separate simulations: a sum entered for anyone in
+    # a simulation is an input for everyone in it.
+    summed = Simulation(situation=_situation(summed_units))
+    leaves = Simulation(situation=_situation(leaf_units))
+    # The short-term memo is added back, so line J is the year's own result.
+    np.testing.assert_allclose(
+        summed.calculate("az_property_tax_credit_income", YEAR), LINE_J, atol=0.01
+    )
+    for name in [
+        "long_term_capital_loss_carryover",
+        "short_term_capital_loss_carryover",
+        "az_property_tax_credit_capital_gains",
+        "az_property_tax_credit_income",
+        "az_property_tax_credit",
+        "adjusted_gross_income",
+        "capital_gains_28_percent_rate_gain",
+        "income_tax",
+    ]:
+        np.testing.assert_allclose(
+            leaves.calculate(name, YEAR),
+            summed.calculate(name, YEAR),
+            atol=0.01,
+            err_msg=name,
+        )
diff --git a/policyengine_us/variables/gov/states/az/tax/income/credits/property_tax_credit/az_property_tax_credit_capital_gains.py b/policyengine_us/variables/gov/states/az/tax/income/credits/property_tax_credit/az_property_tax_credit_capital_gains.py
index f0d2ca0e313..dabd2f4bf38 100644
--- a/policyengine_us/variables/gov/states/az/tax/income/credits/property_tax_credit/az_property_tax_credit_capital_gains.py
+++ b/policyengine_us/variables/gov/states/az/tax/income/credits/property_tax_credit/az_property_tax_credit_capital_gains.py
@@ -12,11 +12,10 @@ class az_property_tax_credit_capital_gains(Variable):
         "property for the Arizona property tax credit (Form 140PTC Part 1 line D): "
         "the year's gains and losses combined, including capital gain "
         "distributions, with a net loss counted only up to the per-member limit. "
-        "No prior-year capital loss carryover is used: the long-term carryover "
-        "that long_term_capital_gains nets is added back, including unused "
-        "losses transferred by a terminating estate or trust. Short-term inputs "
-        "must contain only the current year's net gains and losses, without "
-        "Schedule D line 6 carryovers; no short-term carryover memo is modeled."
+        "No prior-year capital loss carryover is used: the long-term and "
+        "short-term carryovers that long_term_capital_gains and "
+        "short_term_capital_gains net are added back, including unused losses "
+        "transferred by a terminating estate or trust."
     )
     reference = [
         "https://www.law.cornell.edu/regulations/arizona/Ariz-Admin-Code-SS-R15-2C-502",
@@ -38,13 +37,20 @@ def formula(person, period, parameters):
         # capital gains (26 U.S.C. 852(b)(3)(B)), so they are combined with the
         # member's other gains and losses before the limit.
         # ITR 12-1 item (7): a prior-year capital loss carryover cannot reduce
-        # the year's gains. long_term_capital_gains includes the long-term
-        # carryover (26 U.S.C. 1212(b)(1)(B)) as a loss, as Schedule D line 15
-        # does, so it is added back to give the year's own net gain or loss.
-        # Reg. 1.642(h)-1(a) transfers a terminating estate/trust's unused
-        # capital loss as a carryover. Max's d1107 ruling (2026-10-09) keeps
-        # final Form 1041 K-1 box 11 code D losses in this addback.
-        carryover = max_(0, person("long_term_capital_loss_carryover", period))
+        # the year's gains. long_term_capital_gains and short_term_capital_gains
+        # include the carryovers as losses, as Schedule D lines 15 and 7 do:
+        # the person's own (26 U.S.C. 1212(b)(1)) and any allowed under 26
+        # U.S.C. 642(h)(1) from a terminated estate or trust. So they are added
+        # back to give the year's own net gain or loss. Reg. 1.642(h)-1(a)
+        # transfers a terminating estate/trust's unused capital loss as a
+        # carryover. Max's d1107 ruling (2026-10-09) keeps final Form 1041 K-1
+        # box 11 code D losses in this addback. Code C, the short-term
+        # counterpart under the same regulation, is treated the same pending
+        # his confirmation (d1512). The estate_or_trust_* leaves hold those
+        # losses apart from the person's own carryovers.
+        carryover = max_(0, person("long_term_capital_loss_carryover", period)) + max_(
+            0, person("short_term_capital_loss_carryover", period)
+        )
         net_capital_gain = (
             add(person, period, ["capital_gains", "non_sch_d_capital_gains"])
             + carryover
diff --git a/policyengine_us/variables/household/income/person/capital_gains/estate_or_trust_long_term_capital_loss_carryover.py b/policyengine_us/variables/household/income/person/capital_gains/estate_or_trust_long_term_capital_loss_carryover.py
new file mode 100644
index 00000000000..fe7f88e88a1
--- /dev/null
+++ b/policyengine_us/variables/household/income/person/capital_gains/estate_or_trust_long_term_capital_loss_carryover.py
@@ -0,0 +1,39 @@
+from policyengine_us.model_api import *
+
+
+class estate_or_trust_long_term_capital_loss_carryover(Variable):
+    value_type = float
+    entity = Person
+    label = "Long-term capital loss carryover from a terminated estate or trust"
+    unit = USD
+    documentation = (
+        "Long-term capital loss carryover a beneficiary succeeds to when an "
+        "estate or trust terminates, as a positive amount: Schedule K-1 (Form "
+        "1041), box 11, code D, from the estate or trust's final year. Under "
+        "26 U.S.C. 642(h)(1) and Reg. 1.642(h)-1(a), a capital loss carryover "
+        "the estate or trust could have used after that year but for the "
+        "termination is allowed to the beneficiaries succeeding to its "
+        "property. Reg. 1.642(h)-1(b) keeps it long-term for a beneficiary "
+        "that is not a corporation. The beneficiary reports it on Schedule D "
+        "line 12, on line 5 of the 28% Rate Gain Worksheet and on line 16 of "
+        "the Unrecaptured Section 1250 Gain Worksheet. The person's own "
+        "carryover goes in own_long_term_capital_loss_carryover instead. Memo "
+        "item: long_term_capital_gains already includes it as a loss, as "
+        "Schedule D line 15 does. Zero unless entered."
+    )
+    definition_period = YEAR
+    uprating = "calibration.gov.irs.soi.long_term_capital_gains"
+    reference = [
+        dict(
+            title="26 U.S. Code § 642(h)(1)",
+            href="https://www.law.cornell.edu/uscode/text/26/642#h_1",
+        ),
+        dict(
+            title="26 CFR § 1.642(h)-1",
+            href="https://www.law.cornell.edu/cfr/text/26/1.642(h)-1",
+        ),
+        dict(
+            title="2025 Instructions for Schedule K-1 (Form 1041) for a Beneficiary Filing Form 1040 or 1040-SR, Box 11, Codes C and D",
+            href="https://www.irs.gov/pub/irs-prior/i1041sk1--2025.pdf#page=3",
+        ),
+    ]
diff --git a/policyengine_us/variables/household/income/person/capital_gains/estate_or_trust_short_term_capital_loss_carryover.py b/policyengine_us/variables/household/income/person/capital_gains/estate_or_trust_short_term_capital_loss_carryover.py
new file mode 100644
index 00000000000..084767bc991
--- /dev/null
+++ b/policyengine_us/variables/household/income/person/capital_gains/estate_or_trust_short_term_capital_loss_carryover.py
@@ -0,0 +1,37 @@
+from policyengine_us.model_api import *
+
+
+class estate_or_trust_short_term_capital_loss_carryover(Variable):
+    value_type = float
+    entity = Person
+    label = "Short-term capital loss carryover from a terminated estate or trust"
+    unit = USD
+    documentation = (
+        "Short-term capital loss carryover a beneficiary succeeds to when an "
+        "estate or trust terminates, as a positive amount: Schedule K-1 (Form "
+        "1041), box 11, code C, from the estate or trust's final year. Under "
+        "26 U.S.C. 642(h)(1) and Reg. 1.642(h)-1(a), a capital loss carryover "
+        "the estate or trust could have used after that year but for the "
+        "termination is allowed to the beneficiaries succeeding to its "
+        "property. Reg. 1.642(h)-1(b) keeps it short-term. The beneficiary "
+        "reports it on Schedule D line 5. The person's own carryover goes in "
+        "own_short_term_capital_loss_carryover instead. Memo item: "
+        "short_term_capital_gains already includes it as a loss, as Schedule "
+        "D line 7 does. Zero unless entered."
+    )
+    definition_period = YEAR
+    uprating = "calibration.gov.irs.soi.short_term_capital_gains"
+    reference = [
+        dict(
+            title="26 U.S. Code § 642(h)(1)",
+            href="https://www.law.cornell.edu/uscode/text/26/642#h_1",
+        ),
+        dict(
+            title="26 CFR § 1.642(h)-1",
+            href="https://www.law.cornell.edu/cfr/text/26/1.642(h)-1",
+        ),
+        dict(
+            title="2025 Instructions for Schedule K-1 (Form 1041) for a Beneficiary Filing Form 1040 or 1040-SR, Box 11, Codes C and D",
+            href="https://www.irs.gov/pub/irs-prior/i1041sk1--2025.pdf#page=3",
+        ),
+    ]
diff --git a/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_gains.py b/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_gains.py
index 86d1e3e9d59..bbba9e7ef14 100644
--- a/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_gains.py
+++ b/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_gains.py
@@ -6,7 +6,12 @@ class long_term_capital_gains(Variable):
     entity = Person
     label = "long-term capital gains"
     unit = USD
-    documentation = "Net gains made from sales of assets held for more than one year (losses are expressed as negative gains)."
+    documentation = (
+        "Net gains made from sales of assets held for more than one year (losses "
+        "are expressed as negative gains): Schedule D line 15, net of any "
+        "long-term capital loss carryover, which long_term_capital_loss_carryover "
+        "records as a memo."
+    )
     definition_period = YEAR
     reference = dict(
         title="26 U.S. Code § 1222(3)",
diff --git a/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_loss_carryover.py b/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_loss_carryover.py
index ae642e1df84..3c5aba0cddb 100644
--- a/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_loss_carryover.py
+++ b/policyengine_us/variables/household/income/person/capital_gains/long_term_capital_loss_carryover.py
@@ -7,20 +7,28 @@ class long_term_capital_loss_carryover(Variable):
     label = "Long-term capital loss carryover"
     unit = USD
     documentation = (
-        "Long-term capital loss carried to the year under 26 U.S.C. "
-        "1212(b)(1)(B), as a positive amount: Schedule D line 14 plus any "
-        "carryover on Schedule K-1 (Form 1041), box 11, code D, from the "
-        "final year of an estate or trust (line 5 of the 28% Rate Gain "
-        "Worksheet and line 16 of the Unrecaptured Section 1250 Gain "
-        "Worksheet). Memo item: long_term_capital_gains already includes it "
-        "as a loss, as Schedule D line 15 does, so it does not change gross "
-        "income. It reduces collectibles_gain_or_loss and section_1202_gain "
-        "in the 28-percent rate gain, and what they do not absorb reduces "
-        "unrecaptured_section_1250_gain_before_losses. Zero, no carryover, "
-        "unless entered."
+        "Long-term capital loss carried to the year, as a positive amount: the "
+        "person's own carryover under 26 U.S.C. 1212(b)(1)(B), on Schedule D "
+        "line 14, plus any carryover allowed under 26 U.S.C. 642(h)(1) from "
+        "the final year of an estate or trust, on Schedule K-1 (Form 1041), "
+        "box 11, code D, which is part of Schedule D line 12. Together they "
+        "are line 5 of the 28% Rate Gain Worksheet and line 16 of the "
+        "Unrecaptured Section 1250 Gain Worksheet. The sum of "
+        "own_long_term_capital_loss_carryover and "
+        "estate_or_trust_long_term_capital_loss_carryover. A nonzero amount "
+        "entered here for a year is filed as the person's own carryover when "
+        "a Simulation or Microsimulation is built, in place of the leaves "
+        "entered for that year. Memo item: long_term_capital_gains already "
+        "includes it as a loss, as Schedule D line 15 does, so it does not "
+        "change gross income. It reduces collectibles_gain_or_loss and "
+        "section_1202_gain in the 28-percent rate gain, and what they do not "
+        "absorb reduces unrecaptured_section_1250_gain_before_losses."
     )
     definition_period = YEAR
-    uprating = "calibration.gov.irs.soi.long_term_capital_gains"
+    adds = [
+        "own_long_term_capital_loss_carryover",
+        "estate_or_trust_long_term_capital_loss_carryover",
+    ]
     reference = [
         dict(
             title="26 U.S. Code § 1(h)(4)(B)(iii)",
@@ -31,7 +39,15 @@ class long_term_capital_loss_carryover(Variable):
             href="https://www.law.cornell.edu/uscode/text/26/1212#b_1_B",
         ),
         dict(
-            title="2025 Instructions for Schedule D (Form 1040), 28% Rate Gain Worksheet—Line 18, line 5",
-            href="https://www.irs.gov/pub/irs-prior/i1040sd--2025.pdf#page=11",
+            title="26 U.S. Code § 642(h)(1)",
+            href="https://www.law.cornell.edu/uscode/text/26/642#h_1",
+        ),
+        dict(
+            title="2025 Instructions for Schedule D (Form 1040), Capital Loss Carryover Worksheet, 28% Rate Gain Worksheet and Unrecaptured Section 1250 Gain Worksheet #page 10-11,13",
+            href="https://www.irs.gov/pub/irs-prior/i1040sd--2025.pdf#page=10",
+        ),
+        dict(
+            title="2025 Instructions for Schedule K-1 (Form 1041) for a Beneficiary Filing Form 1040 or 1040-SR, Box 11, Codes C and D",
+            href="https://www.irs.gov/pub/irs-prior/i1041sk1--2025.pdf#page=3",
         ),
     ]
diff --git a/policyengine_us/variables/household/income/person/capital_gains/own_long_term_capital_loss_carryover.py b/policyengine_us/variables/household/income/person/capital_gains/own_long_term_capital_loss_carryover.py
new file mode 100644
index 00000000000..fcaf2f13943
--- /dev/null
+++ b/policyengine_us/variables/household/income/person/capital_gains/own_long_term_capital_loss_carryover.py
@@ -0,0 +1,29 @@
+from policyengine_us.model_api import *
+
+
+class own_long_term_capital_loss_carryover(Variable):
+    value_type = float
+    entity = Person
+    label = "Own long-term capital loss carryover"
+    unit = USD
+    documentation = (
+        "Long-term capital loss carried to the year from the person's own "
+        "earlier years under 26 U.S.C. 1212(b)(1)(B), as a positive amount: "
+        "Schedule D line 14, from line 13 of the Capital Loss Carryover "
+        "Worksheet. A carryover from a terminated estate or trust goes in "
+        "estate_or_trust_long_term_capital_loss_carryover instead. Memo item: "
+        "long_term_capital_gains already includes it as a loss, as Schedule D "
+        "line 15 does. Zero, no carryover, unless entered."
+    )
+    definition_period = YEAR
+    uprating = "calibration.gov.irs.soi.long_term_capital_gains"
+    reference = [
+        dict(
+            title="26 U.S. Code § 1212(b)(1)(B)",
+            href="https://www.law.cornell.edu/uscode/text/26/1212#b_1_B",
+        ),
+        dict(
+            title="2025 Instructions for Schedule D (Form 1040), Capital Loss Carryover Worksheet—Lines 6 and 14",
+            href="https://www.irs.gov/pub/irs-prior/i1040sd--2025.pdf#page=10",
+        ),
+    ]
diff --git a/policyengine_us/variables/household/income/person/capital_gains/own_short_term_capital_loss_carryover.py b/policyengine_us/variables/household/income/person/capital_gains/own_short_term_capital_loss_carryover.py
new file mode 100644
index 00000000000..5a3d05a8fd2
--- /dev/null
+++ b/policyengine_us/variables/household/income/person/capital_gains/own_short_term_capital_loss_carryover.py
@@ -0,0 +1,29 @@
+from policyengine_us.model_api import *
+
+
+class own_short_term_capital_loss_carryover(Variable):
+    value_type = float
+    entity = Person
+    label = "Own short-term capital loss carryover"
+    unit = USD
+    documentation = (
+        "Short-term capital loss carried to the year from the person's own "
+        "earlier years under 26 U.S.C. 1212(b)(1)(A), as a positive amount: "
+        "Schedule D line 6, from line 8 of the Capital Loss Carryover "
+        "Worksheet. A carryover from a terminated estate or trust goes in "
+        "estate_or_trust_short_term_capital_loss_carryover instead. Memo item: "
+        "short_term_capital_gains already includes it as a loss, as Schedule D "
+        "line 7 does. Zero, no carryover, unless entered."
+    )
+    definition_period = YEAR
+    uprating = "calibration.gov.irs.soi.short_term_capital_gains"
+    reference = [
+        dict(
+            title="26 U.S. Code § 1212(b)(1)(A)",
+            href="https://www.law.cornell.edu/uscode/text/26/1212#b_1_A",
+        ),
+        dict(
+            title="2025 Instructions for Schedule D (Form 1040), Capital Loss Carryover Worksheet—Lines 6 and 14",
+            href="https://www.irs.gov/pub/irs-prior/i1040sd--2025.pdf#page=10",
+        ),
+    ]
diff --git a/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_gains.py b/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_gains.py
index fc7cf2ba8ea..db9cd997e45 100644
--- a/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_gains.py
+++ b/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_gains.py
@@ -6,7 +6,12 @@ class short_term_capital_gains(Variable):
     entity = Person
     label = "short-term capital gains"
     unit = USD
-    documentation = "Net gains made from sales of assets held for one year or less(losses are expressed as negative gains)."
+    documentation = (
+        "Net gains made from sales of assets held for one year or less (losses "
+        "are expressed as negative gains): Schedule D line 7, net of any "
+        "short-term capital loss carryover, which short_term_capital_loss_carryover "
+        "records as a memo."
+    )
     definition_period = YEAR
     reference = dict(
         title="26 U.S. Code § 1222(1)",
diff --git a/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_loss_carryover.py b/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_loss_carryover.py
new file mode 100644
index 00000000000..ea6b7d90428
--- /dev/null
+++ b/policyengine_us/variables/household/income/person/capital_gains/short_term_capital_loss_carryover.py
@@ -0,0 +1,47 @@
+from policyengine_us.model_api import *
+
+
+class short_term_capital_loss_carryover(Variable):
+    value_type = float
+    entity = Person
+    label = "Short-term capital loss carryover"
+    unit = USD
+    documentation = (
+        "Short-term capital loss carried to the year, as a positive amount: "
+        "the person's own carryover under 26 U.S.C. 1212(b)(1)(A), on "
+        "Schedule D line 6, plus any carryover allowed under 26 U.S.C. "
+        "642(h)(1) from the final year of an estate or trust, on Schedule K-1 "
+        "(Form 1041), box 11, code C, which is part of Schedule D line 5. The "
+        "sum of own_short_term_capital_loss_carryover and "
+        "estate_or_trust_short_term_capital_loss_carryover. A nonzero amount "
+        "entered here for a year is filed as the person's own carryover when "
+        "a Simulation or Microsimulation is built, in place of the leaves "
+        "entered for that year. Memo item: short_term_capital_gains already "
+        "includes it as a loss, as Schedule D line 7 does, so it does not "
+        "change gross income or the net short-term capital loss on line 6 of "
+        "the 28% Rate Gain Worksheet. The Arizona property tax credit adds it "
+        "back."
+    )
+    definition_period = YEAR
+    adds = [
+        "own_short_term_capital_loss_carryover",
+        "estate_or_trust_short_term_capital_loss_carryover",
+    ]
+    reference = [
+        dict(
+            title="26 U.S. Code § 1212(b)(1)(A)",
+            href="https://www.law.cornell.edu/uscode/text/26/1212#b_1_A",
+        ),
+        dict(
+            title="26 U.S. Code § 642(h)(1)",
+            href="https://www.law.cornell.edu/uscode/text/26/642#h_1",
+        ),
+        dict(
+            title="2025 Instructions for Schedule D (Form 1040), Capital Loss Carryover Worksheet and 28% Rate Gain Worksheet #page 10-11",
+            href="https://www.irs.gov/pub/irs-prior/i1040sd--2025.pdf#page=10",
+        ),
+        dict(
+            title="2025 Instructions for Schedule K-1 (Form 1041) for a Beneficiary Filing Form 1040 or 1040-SR, Box 11, Codes C and D",
+            href="https://www.irs.gov/pub/irs-prior/i1041sk1--2025.pdf#page=3",
+        ),
+    ]