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Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22696
Experience:  Taxes, Immigration, Labor Relations
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If I elect out of NOL carryback, and only carryforward the

Resolved Question:

If I elect out of NOL carryback, and only carryforward the loss, how are those losses allocated? Do I need to file a 1095 A every year if I want to carry forward the losses from my first year S-Corp?
Submitted: 2 years ago.
Category: Tax
Expert:  Lev replied 2 years ago.

LEV :

Hi and welcome to Just Answer!


Partnerships and S corporations generally cannot use an NOL. However, partners or shareholders can use their separate shares of the partnership's or S corporation's business income and business deductions to figure their individual NOLs.

So - you need to determine if you have a NOL on your individual tax return and if you want - you may choose only to carry NOL forward.

LEV :

Follow Steps 1 through 5 to figure and use your NOL.


Step 1. Complete your tax return for the year. You may have an NOL if a negative figure appears on the line below: Individuals — Form 1040, line 41.


If the amount on that line is not negative, stop here — you do not have an NOL.


Step 2. Determine whether you have an NOL and its amount. See How To Figure an NOL . If you do not have an NOL, stop here.


Step 3. Decide whether to carry the NOL back to a past year or to waive the carryback period and instead carry the NOL forward to a future year.


Step 4. Deduct the NOL in the carryback or carryforward year. If your NOL deduction is equal to or less than your taxable income without the deduction, stop here — you have used up your NOL.


Step 5. Determine the amount of your unused NOL. Carry over the unused NOL to the next carryback or carryforward year and begin again at Step 4.

LEV :

Generally, if you have an NOL for a tax year ending in 2011, you must carry back the entire amount of the NOL to the 2 tax years before the NOL year (the carryback period), and then carry forward any remaining NOL for up to 20 years after the NOL year (the carryforward period). You can, however, choose not to carry back an NOL and only carry it forward. You cannot deduct any part of the NOL remaining after the 20-year carryforward period.

Customer:

Ok, my 2011 personal return is showing a loss of $80K on line 41

Customer:

So, that means that I can carry back that $80K loss to 2009 first and then to 2010 and than to future years, right?

Customer:

So, if my 2009 AGI is more than $80K, than does that means that I have used up all of my NOL, and if my 2009 AGI is less than $80K, than does that mean that I have some NOL remaining for 2010?

Customer:

Also, If I am able to use the NOL for more than one year, than do I need to file a separate 1095 for each year I am taking the NOL?

Customer:

Or, for my 2009 I look at line 41 after the carryback and if it is negative, than I still have loss remaining?

Customer:

to use for 2010 and afterwards

LEV :

So, that means that I can carry back that $80K loss to 2009 first and then to 2010 and than to future years, right?





Yes - that is correcrt.
So, if my 2009 AGI is more than $80K, than does that means that I have used up all of my NOL, and if my 2009 AGI is less than $80K, than does that mean that I have some NOL remaining for 2010?





That is also correct.
Also, If I am able to use the NOL for more than one year, than do I need to file a separate 1095 for each year I am taking the NOL?
I assume you meant form 1045 - correct?


Customer:

yeah, 1045 not 1095

Customer:

So if my 2009 AGI is greater than $80K and the effect still results in a line 41 loss, that means that I still have some NOL to use right?

LEV :

Yes - you will use these NOL for 2009 and the rest for 2010 - and will claim refund for both these years.

Customer:

Can I go back 3 years... my software has slots for 3years?

Customer:

Also how will I know how much NOL I will have left over after applying the amounts to 2009?

LEV :

That is what teh form 1045 is ued to determine your NOL.

Customer:

I ran through the numbers, and I actually had a greater loss and the result from 1045 A line 25 is (123,231)

LEV :

Some NOLs are carried back for three years.

LEV :

Eligible losses, farming losses, qualified disaster losses, qualified GO Zone losses, and specified liability losses, qualify for longer carryback periods.

Customer:

are NOLs resulting from first year S-corp elible for 3 year carryback?

Customer:

Also, what line number on 1045 will tell me how much NOL I have remaining?

LEV :

Losses from S-corporation are not eligible - only losses from a qualified small business are eligible - a qualified small business may be a sole proprietorship or a partnership.

LEV :

form 1045 - schedule B line 10 - NOL carryover. - see example on page 13 in this publication - http://www.irs.gov/pub/irs-pdf/p536.pdf

Customer:

Ok, what line number tells me how much refund I will get back due to the carryback? Also, is there a way to get that amount direct deposit into my bank account, or does it have to be a check I get in the mail?

LEV :

Ok, what line number tells me how much refund I will get back due to the carryback?
Overpayment of tax will be on form 1045 line 28.
Also, is there a way to get that amount direct deposit into my bank account, or does it have to be a check I get in the mail?
There is no direct deposit option - refund check will be sent in mail.

Customer:

Ok, thanks for your help

Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22696
Experience: Taxes, Immigration, Labor Relations
Lev and 4 other Tax Specialists are ready to help you

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