A loss incurred by a corporation
A)Must be carried forward unless the company has had 2 loss years in a row.
B)Can be carried back 2 years, then carried forward up to 20 years following the loss.
C)Can be carried back 5 years and forward 3 years.
D)Cannot be used to reduce taxes in other years except with special permission from the IRS.
E)Can be carried back 3 years or forward 10 years, whichever is more advantageous to the firm.

Question

Quizplus · Accepted Answer

According to the tax code, a corporation can carry back the loss for up to two years and carry forward the loss for up to 20 years following the loss. Hence, option B is the correct answer. Options A, C, D, and E are incorrect as they do not align with the tax code provisions.

A Loss Incurred by a Corporation