If a C corporation incurs a net operating loss in 2020 and carries the loss forward to 2021, the NOL carryover is not allowed to offset 100 percent of the corporation's taxable income (before the net operating loss deduction).

Question

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Due to changes made by the Tax Cuts and Jobs Act (TCJA) and the Coronavirus Aid, Relief, and Economic Security (CARES) Act, for tax years beginning after 2020, the net operating loss (NOL) carryover can only offset up to 80% of a corporation's taxable income (before the net operating loss deduction).

If a C Corporation Incurs a Net Operating Loss in 2020