The Department of the Treasury and the Internal Revenue Service issued proposed regulations and temporary regulations that provide guidance for consolidated groups regarding net operating losses (NOLs).
The Tax Cuts and Jobs Act (TCJA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) amended the rules for NOLs. After amendment, the NOL deduction is the sum of:
The total of the NOLs arising before January 1, 2018 (pre-2018 NOLs) that are carried to that year; plus
The lesser of:
The total of the NOLs arising after December 31, 2017; or
80% of taxable income less pre-2018 NOLs (the 80% limitation).
The TCJA generally eliminated NOL carrybacks and permitted NOLs to be carried forward indefinitely. The TCJA also provides special rules for nonlife insurance companies and farming losses. Nonlife insurance companies are permitted to carry back NOLs two years and forward 20 years, and the 80% limitation does not apply. Farming losses are permitted to be carried back two years and carried forward indefinitely, subject to the 80% limitation.
IR-2018-82, April 2, 2018
WASHINGTON ― The Treasury Department and the Internal Revenue Service (IRS) yesterday issued Notice 2018-28, which provides guidance for computing the business interest expense limitation under recent tax legislation enacted on Dec. 22, 2017.
In general, newly amended section 163(j) of the Internal Revenue Code imposes a limitation on deductions for business interest incurred by certain large businesses. For most large businesses, business interest expense is limited to any business interest income plus 30 percent of the business’ adjusted taxable income. Read More
The IRS is an agency of the Treasury Department and is charged with the administration of the tax laws. It is the largest government agency in the world. Headed by the Commissioner of Internal Revenue, its structure is as follows:
(1) There are four civil compliance divisions responsible for serving specific groups of taxpayers with similar needs. They are:
a. Wage and Investment Division: This division services 88 million individual taxpayers who have only wage and investment income, almost all of which is reported to the IRS by third-party payors.
b. Small Business Self-employed Division: This division is responsible for taxpayers who Read More
The United States Treasury Department announced February 5, 2014 that Canada and Hungary will implement the Foreign Account Tax Compliance Act (FATCA), in an effort to discourage offshore tax evasion.
The Republican National Committee recently voted to call for the repeal of FATCA and plans to make it a campaign issue this year (see FATCA Implementation Unimpeded by Republicans!)
In an effort to alleviate the concerns of foreign governments about their own bank secrecy laws, the Treasury Department has been negotiating a series of intergovernmental agreements under which it also agrees to share information about their citizens and Read More