If a deceased taxpayer has had capital losses in the year of death, this amount will show as a negative number on line 127 of T1 jacket.
However, the current year losses must be reduced by whatever capital gains deductions the client has had in the past. If it does not match CRA records, then it will generate an EFILE error.
From the remaining net capital loss, subtract any capital gains deductions the deceased has claimed to date. Use any loss left to reduce other income for the year of death, the year before the year of death, or for both years.
Contact the CRA EFILE helpdesk to determine what the taxpayer has claimed in the past.