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@Anthony C wrote:

losses suspended due to basis limitations, about $30k each after 2019. 

Question is, recognize that amount as a capital gain in 2020 or is this just a basis adjustment with no recognition of capital gains?

 

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If there is $30,000 of suspended Basis losses from 2018/2019, then in 2020 the first $30,000 of "ordinary income" (Box 1) will be tax free.  Not a capital gain or taxable at all.  If the business had $40,000 of income in 2020, that first raises Basis to $40,000, but then using the $30,000 of suspended losses will lower the Basis (for 2021) down to $10,000.

Does that help?  If not, can you give more details and explain why you think something would have a taxable gain?