Oh Baby! Posted June 16, 2010 Report Share Posted June 16, 2010 Although I have been doing taxes for 13 years, I've never had the distinct privilege of working with an NOL and so I need a quick education. Client has NOL's for 2008 and 2007. I want to carry those losses back to 2006. Unfortunately, TP is getting hit with AMT when I throw in the NOL (carried back from 2008 and 2007)and actually owes more money because of the NOL. So I'd rather use the NOL in 2005, when the TP has real benefit. Is that allowed or do I first have to apply the NOL to 2006 and then use the remainder on 2005? Quote Link to comment Share on other sites More sharing options...
Lion EA Posted June 16, 2010 Report Share Posted June 16, 2010 You carry it back to the oldest year appropriate for your default or your election and then carry it forward from that point if it hasn't been used up yet. Quote Link to comment Share on other sites More sharing options...
jainen Posted June 16, 2010 Report Share Posted June 16, 2010 >>TP is getting hit with AMT when I throw in the NOL<< I'm always uncomfortable about the term, "hit with AMT." AMT is a normal part of the system, somewhat more predictable than regular tax. And you shouldn't "throw in the NOL." That is something for which you have a number of planning options. Remember to calculate and apply the AMT NOL separately, for both the current and carryback years. It's a lot of work. Quote Link to comment Share on other sites More sharing options...
Oh Baby! Posted June 16, 2010 Author Report Share Posted June 16, 2010 Sorry. I meant to say "screwed by the AMT". >>TP is getting hit with AMT when I throw in the NOL<< I'm always uncomfortable about the term, "hit with AMT." AMT is a normal part of the system, somewhat more predictable than regular tax. And you shouldn't "throw in the NOL." That is something for which you have a number of planning options. Remember to calculate and apply the AMT NOL separately, for both the current and carryback years. It's a lot of work. Quote Link to comment Share on other sites More sharing options...
jainen Posted June 16, 2010 Report Share Posted June 16, 2010 >>I meant to say<< What I meant was that relying on tax benefits makes a poor business model. I'm sorry he has to go back five years to find any decent numbers, but the whole world is pretty much like that these days. I think the idea of the carryback is that the big losses we are seeing now can in a sense be blamed on what was going on three to five years ago. I do admit to some political bias in my economic analysis. Quote Link to comment Share on other sites More sharing options...
Gail in Virginia Posted June 16, 2010 Report Share Posted June 16, 2010 >>I meant to say<< I do admit to some political bias in my economic analysis. Most people, myself included, have some political or emotional bias in their economic and other analysis. At least you are wiling to own up to it. Quote Link to comment Share on other sites More sharing options...
SFBOB Posted June 17, 2010 Report Share Posted June 17, 2010 If you have not printed the instructions on form 1045, go ahead. Pour yourself a large drink of your choice and go to it. This will be a good learning experience for you. Good Luck Bob Quote Link to comment Share on other sites More sharing options...
michaelmars Posted June 17, 2010 Report Share Posted June 17, 2010 the problem for me is i do so few of these that i have to re-study the instructions each time! Quote Link to comment Share on other sites More sharing options...
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