Tax Planning Opportunities for Individual Net Operating Losses

Journal of Taxation, Volume 119, Number 03, September 2013

23 Pages Posted: 11 Feb 2014

See all articles by John Everett

John Everett

Virginia Commonwealth University (VCU) - Department of Accounting

Cherie Hennig

University of North Carolina (UNC) at Wilmington - Department of Accountancy and Business Law

William A. Raabe

University of Wisconsin - Whitewater - College of Business and Economics

Blaise Sonnier

University of Colorado, Colorado Springs - College of Business

Date Written: September 30, 2013

Abstract

The add-backs, adjustments, and other computations involved for individuals who incur a NOL, as well as the factors to consider in deciding if the carryback should be waived, can appear daunting.

NOLs relate only to business income and deduction items, so an individual taxpayer must separate out the nonbusiness items on the Form 1040 in computing the NOL. The modifications that apply in this process can be complex to derive and apply, even for the experienced tax professional. This article has provided explanations of the rules and illustrations of how they work, including a thorough case study to demonstrate the use of an NOL.

Keywords: tax, individual NOL, carryover, carryback, carryforward, income smoothing, case study

JEL Classification: H20, H25, K34

Suggested Citation

Everett, John and Hennig, Cherie and Raabe, William A. and Sonnier, Blaise, Tax Planning Opportunities for Individual Net Operating Losses (September 30, 2013). Journal of Taxation, Volume 119, Number 03, September 2013. Available at SSRN: https://ssrn.com/abstract=2393558

John Everett

Virginia Commonwealth University (VCU) - Department of Accounting ( email )

Richmond, VA 23284
United States

Cherie Hennig

University of North Carolina (UNC) at Wilmington - Department of Accountancy and Business Law ( email )

601 S. College Road
Wilmington, NC 28403
United States

William A. Raabe (Contact Author)

University of Wisconsin - Whitewater - College of Business and Economics ( email )

Whitewater, WI 53190
United States

HOME PAGE: http://billraabetax.com

Blaise Sonnier

University of Colorado, Colorado Springs - College of Business ( email )

1420 Austin Bluffs Parkway
Colorado Springs, CO 80933-7150
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
186
Abstract Views
1,143
rank
163,415
PlumX Metrics