The CARES Act signed March 27 included provisions regarding net operating losses (NOLs) relating to carrybacks in an effort to provide tax relief. On April 9, the IRS released guidance on this measure including:
- “waiving the carryback period in the case of a net operating loss arising in a taxable year beginning after Dec. 31, 2017, and before Jan. 1, 2021,
- disregarding certain amounts of foreign income subject to transition tax that would normally have been included as income during the five-year carryback period, and
- waiving a carryback period, reducing a carryback period, or revoking an election to waive a carryback period for a taxable year that began before Jan. 1, 2018, and ended after Dec. 31, 2017.”
A six-month extension was also granted to file Form 1045 or Form 1139 as applicable.
For more information, see the news release from the IRS, https://www.irs.gov/newsroom/irs-provides-guidance-under-the-cares-act-to-taxpayers-with-net-operating-losses, or read the guidance https://www.irs.gov/pub/irs-drop/rp-20-24.pdf.