Tax Warrior Chronicles

Opportunities to Increase Cash Flow from 2018–2020 Business Losses

Posted on Wed, Apr 22, 2020

The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) provides relief to taxpayers with net operating losses (“NOLs”) and excess business losses (“EBLs”) arising in taxable years 2018 to 2020.  The IRS recently issued guidance related to the new NOLs rules under the CARES Act, which are favorable to taxpayers seeking such relief.

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Disallowance of Excess Business Losses

Posted on Thu, Oct 03, 2019

By: Steven A. Braun, CPA

 

The Tax Cuts and Jobs Act added Section 461(l) to the Internal Revenue Code (“the Code”), which limits the excess business losses of noncorporate taxpayers.  The limitation applies to sole proprietors, partnerships, S Corporations, limited liability companies, estates and trusts for years beginning after December 31, 2017 and before January 1, 2026.

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Tax Reform NOL Changes May Impact Struggling Companies

Posted on Thu, Mar 22, 2018

By: Jenny Zhang, CPA, MT

 

Before the Tax Cuts and Jobs Act of 2017, taxpayers could carryback a Net Operating Loss (NOL) for two years and carry it forward up to 20 years.  The NOL wasn’t subject to a limitation based on the taxable income except for alternative minimum tax purposes.  But those good old days have ended. Now, as part of recent Tax Reform, a business’s options to deduct losses has changed and not all for the good.

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Carryback and Carryforward Periods for NOLs – A Tax Lifeline for Business Owners

Posted on Mon, May 11, 2015

With the economy continuing to trend upward since the 2008 recession, many businesses have returned to profitability.  No business owner ever wants to operate at a loss, but sometimes the economy and other factors dictate otherwise.  However, a loss isn’t always a bad thing when you’ve been profitable in prior years or anticipate large profits in future periods.

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