* Net Operation Loss Carrybacks
: Repeals the ability for taxpayers to carry back NOLs to previous taxable years.
The allowance of operating loss carrybacks
and carryforwards has long been seen by Congress as a means to treat more equally taxpayers with similar average incomes but different earnings cycles that span periods longer than a tax year.
A: Both bills eliminate net operating loss carrybacks
. Both bills also make changes to the treatment of loss carryforwards.
1.1502- 21(b) and 1.1502-22(b) (relating to net capital loss carrybacks
In other words, net operating loss carrybacks
and carryovers must be applied against income of the estate before any administrative expense loss carrybacks
* The attempted repeal of the net operating loss carrybacks
, AB 2408 (Skinner).
Companies also can accelerate adjustments due to anticipated tax loss carrybacks
. Form 1139, Corporation Application for Tentative Refund, can be used to carry back net operating losses to prior periods and can be a faster way for companies to get refunds based on their NOLs.
617),Jay Starkman suggested a tax planning technique using net operating loss carrybacks
and carryforwards and cautioned that there is no benefit to a personal service corporation in making a Sec.
Hedgpeth next explained that the Office of Chief Counsel is developing additional language providing guidance for waivers in four areas: (1) new entities entering a taxpayer's return as a result of merger and acquisition activity; (2) the effect of net operating loss carrybacks
; (3) Chapter 7 bankruptcy proceedings; and (4) final entity tax returns.
170(b)(2), a regular C corporation's deduction for charitable contributions cannot exceed 10 percent of its taxable income (without deducting charitable contributions, special deductions for dividends received, premiums on convertible bond repurchases, and net operating or capital loss carrybacks
172, which allows a deduction for the tax year of "an amount equal to the aggregate of (1) the net operating loss carryovers to such year, plus (2) the net operating loss carrybacks
to such year." The allowable carryback and carryforward periods for the tax years at issue are three years and 15 years, respectively, under Sec.
The Administration's budget proposal extends the temporary waiver of the AMTI limitation on net operating loss carrybacks
to those originating in taxable years ending in 2003, 2004, and 2005, as well as for NOLs carried forward into those years.