Keep Corporation joined an affiliated group by merger in 2010. The group generated a 2018 consolidated NOL, and Keep's share of the loss was $50,000. Keep's share of the loss is included in the group's NOL carryforward to 2019.

Question

Quizplus · Accepted Answer

In the United States, when a corporation becomes part of an affiliated group that files a consolidated tax return, the group's net operating losses (NOLs) can be shared among the members of the group. This means that Keep Corporation's share of the 2018 consolidated NOL would be included in the group's NOL carryforward to 2019, allowing the group to offset its 2019 income with losses incurred in 2018, including those attributed to Keep Corporation.

Keep Corporation Joined an Affiliated Group by Merger in 2010