Carryback

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Carryback

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.

carryback

A business operating loss that, for tax purposes, may be deducted for a certain number of prior years, usually no more than three. A business uses a carryback to recover taxes paid on income earned in prior years. For example, if a firm experiences a year of large losses following a period of profitable operations, it may use the losses to cancel out profits from preceding years on which taxes have been paid. When the taxes a company paid on profits are canceled because of a carryback, the firm is issued a refund by the Internal Revenue Service. Also called carryover, tax loss carryback.
References in classic literature ?
So saying--urged by a sense of duty--at the risk of both making myself sick and incurring the wrath of my employers--I got a large flat stone, that had been reared up for a mouse-trap by the gardener; then, having once more vainly endeavoured to persuade the little tyrant to let the birds be carried back, I asked what he intended to do with them.
This courier reached the spot just as the cart appeared in sight; and Barnaby being carried back to jail, Mr Haredale, assured that all was safe, had gone straight from Bloomsbury Square to the Golden Key, leaving to Gabriel the grateful task of bringing him home in triumph.
Lucy had been carried back by their terrible pursuers to fulfil her original destiny, by becoming one of the harem of the Elder's son.
When I had done, Glumdalclitch always carried back my boat into her closet, and hung it on a nail to dry.
That was the amount of information that the lawyer carried back with him to the great, dark bed on which he tossed to and fro, until the small hours of the morning began to grow large.
Having satisfied their curiosity, they carried back to their chief intelligence of all that they had seen.
Even before visiting the Marquesas, I had heard from men who had touched at the group on former voyages some revolting stories in connection with these savages; and fresh in my remembrance was the adventure of the master of the Katherine, who only a few months previous, imprudently venturing into this bay in an armed boat for the purpose of barter, was seized by the natives, carried back a little distance into their valley, and was only saved from a cruel death by the intervention of a young girl, who facilitated his escape by night along the beach to Nukuheva.
That's what you carried back then, unless you were naive enough to carry a semi-auto pistol which--at the time--was good enough for target and range use, but was nowhere near reliable enough for self-defense.
It is too late to carry back from this year to last year, but next year's donation could be carried back to this year when your Tax Return is being completed.
Step 4: Determine the portion of an NOL that can be carried back.
Once a decision is made about when an NOL will be used, it is important that it be carried back and/or forward properly Under IRC [section] 172(b)(1), an NOL (in general) can be carried back two years and forward 20 years (certain special rules exist for NOLs for specified losses, resulting in NOLs that may be carried back more than two years).
Still dressed to the nines, drinkers were carried back to their digs after celebrating the end of term in style at the Trinity May Ball.