If a taxpayer has an NOL in 2011 of $20,000,of which $8,000 is attributable to a theft of personal use property,the taxpayer may:

Question

Quizplus · Accepted Answer

A taxpayer may carry back an NOL for 2 years and then forward for 20 years after the year of the loss. However, if the NOL is attributable to a theft of personal use property, it can only be carried back 3 years. Therefore, the taxpayer can carry back $8,000 of the NOL (the portion attributable to the theft) for 3 years and the remaining $12,000 back 2 years. Option A and B are incorrect because they do not take into account the restriction on carrying back NOLs attributable to theft of personal use property. Option D is incorrect because it includes an option (A) that is not applicable. Option E is incorrect because there is a possibility for carrying back a portion of the NOL.

If a Taxpayer Has an NOL in 2011 of $20,000,of