tax loss carryback


Also found in: Legal.

Carryback

In accounting, a way for a company to reduce its tax liability by applying a net operating loss to previous years in which it made a profit. If a company deducts more than its net income in a given tax year, it may take the difference between the deduction and the net income (a negative number) and apply it as a deduction on taxable income for the previous five years. For example, if a company makes $1,000,000 in one year, and loses $500,000 the following year, it may only be liable for a $500,000 profit on the year it makes a profit. That is, it may receive a tax refund on part of what it paid for the profitable year. See also: Future Income Tax.

tax loss carryback

See carryback.
References in periodicals archive ?
11 per share, before any special income tax adjustments that might become necessary due to changes in the tax law as it relates to tax loss carrybacks.
As reported earlier, the bonds were sold to recover tax loss carrybacks that otherwise would have expired and to increase future income from the portfolio.
14 per share, on the sale of certain portfolio bonds to recover tax loss carrybacks.