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Net Operating Loss

   Also found in: Acronyms, Encyclopedia, Wikipedia 0.02 sec.
Operating Loss
The state in which a company's operating expenses exceed its income for a given period of time, usually a quarter or a year. A company can carry back or carry forward operating losses for a certain number of years, reducing the company's tax liability. This is positive, but an operating loss still means that the company is losing money, which cannot be sustained over the long term.

Net Operating Loss (NOL)
A NOL is the net loss for the year attributable to business or casualty losses. Depending on the nature of the loss, it may be carried back for two, three, or five years before the year of the loss. The loss is subtracted from the income reported on the return and the unused loss can be carried forward for up to 20 years.


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Here's how a tax loss carryback works: Say a company reports a net operating loss of $100 in 2008 and had combined profit of $100 in 2006 and 2007.
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.
United and its subsidiaries, an affiliated group filing a consolidated return, had a net operating loss for each of the tax years in question.
 
 
 
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