Net operating loss

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Under the Federal income tax law, a net operating loss (ZER) occurs when a certain tax deductible expense exceeds taxable income for the tax year. If a taxpayer is taxed during a lucrative period without receiving tax breaks (eg refunds) during the ZERO period, the tax returns are out of balance. Consequently, in some situations, Congress allows taxpayers to use losses in a year to offset earnings in other years.

Video Net operating loss

Count the number of ZERO

The amount of ZERO is the amount of loss from the current year that can be brought back to the previous tax year or forwarded to the coming years.

Individual

The amount of ZERO is a business loss borne by the taxpayer. The following items are excluded when counting the number of ZERO:

• any snippet for private exclusion
• net capital loss (loss of capital exceeding capital gain); net capital gain included
• non-business deductions that exceed non-business income; Non-business net revenue includes

Additionally, Zero counts exclude other adjustments such as:

• section 1202 excludes profits from the sale or exchange of small business shares of quality
• net operating loss reduction from other tax year
• reduced domestic production activity

Corporate

For a company, ZERO is the excess of the allowable deduction of gross income with the following adjustments.

• without zero deduction
• no part of 199 domestic production activities minus
• the dividend received for the received dividend is calculated regardless of section 246 (b) the limit
• dividend-paid deductions are calculated regardless of the limitations below section 247 (a) (1) (B).

Maps Net operating loss

Loss brings back and resumes mechanism

Generally ZERO should be brought back to two tax years before ZERO year. For example, a tax loss of 2015 should be returned to 2013 or 2014. Any remaining amounts can be moved forward to 20 years. Taxpayers may choose to relinquish their luggage and thereby bear all losses for years to come. After a 20-year period of expiration, the taxpayer can not bypass the remaining part of ZERO.

Carry back for certain ZERO for more than 2 years:

3 years brings back the

period

• the loss of the victim or theft
• small federal animal-related livelihoods or losses
• eligible small business loss

5 years bring back period

• agricultural losses
• qualified disaster victims (company only)

10 years bring back period

• the loss associated with the product liability claim
• decommissioning of nuclear power plants - (for corporations only)
• losses related to land reclamation and dismantling of the drilling platform
• environmental pollution-related losses and payment of workers' compensation actions
• Qualified Opportunity Zone (GO Zone) - (company only)

If a company has a company's equity reduction transaction, different carry forward periods may apply.

Section 1211 of the American Recovery and Reinvestment Act of 2009 increases the carry back period for small businesses. For net operating losses incurred in 2008, the carry back period was increased to 5 years.

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Reporting of financial statements

Under US GAAP, the total net operating loss available for the coming years is reported in the notes to the financial statements. For example, Kinross Gold reported $ US $ 893 million from ZERO being forwarded available on December 31, 2014 relating to its subsidiary in Barbados.

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See also

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Note

Source of the article : Wikipedia