So I was reading the setup for Dim Carcosa and ran across the part where each investigator takes horror equal to half their Sanity. Now is number for calculation purposes your max Sanity? Or is it remaining Sanity after you figure in mental trauma?

Trauma does not affect your max sanity, it just adds a horror for each trauma to your investigator at the start of the scenario. Your max sanity is your max sanity unless you are under the effects of a strange weakness or some encounter/agenda effect.

In this case you would calculate half your max, take that much horror, and then take any additional horror for each mental trauma you have taken.

You take it based off your max Sanity. If this wasn't true there wouldn't be a need to then specify that this horror cannot cause you to become defeated since that would never happen if it was based of remaining Sanity.

Also mental trauma does not change your sanity. It just deals you horror at the beginning of each scenario (2nd step of setup).

Thanks, that's how I was leaning, just wanted to see how others took it.

Effects that include already suffered damage or horror specify remaining health or sanity.