If your deductions for the year are more than your income for the year, you may have a net operating loss (NOL). An NOL year is the year in which an NOL occurs. You can use an NOL by deducting it from your income in another year or years.
What this publication covers. This publication discusses NOLs for individuals, estates, and trusts. It covers:
•How to figure an NOL,
•When to use an NOL,
•How to claim an NOL deduction, and
•How to figure an NOL carryover.
To have an NOL, your loss must generally be caused by deductions from your:
•Trade or business,
•Work as an employee,
•Casualty and theft losses,
•Moving expenses, or
•Rental property.
A loss from operating a business is the most common reason for an NOL.
Partnerships and S corporations generally cannot use an NOL. However, partners or shareholders can use their separate shares of the partnership's or S corporation's business income and business deductions to figure their individual NOLs.
Keeping records. You should keep records for any tax year that generates an NOL for 3 years after you have used the carryback/carryforward or 3 years after the carryforward expires.
•NOL Steps
•How To Figure an NOL
oNonbusiness deductions (line 6).
oNonbusiness income (line 7).
oNonbusiness capital losses.
oBusiness capital losses.
oForm 1045, Schedule A Example
•When To Use an NOL
oExceptions to 2-Year Carryback Rule
oWaiving the Carryback Period
oHow To Carry an NOL Back or Forward
•How To Claim an NOL Deduction
oDeducting a Carryback
oDeducting a Carryforward
oChange in Marital Status
oChange in Filing Status
•How To Figure an NOL Carryover
•NOL Carryover From 2014 to 2015
oWorksheet Instructions
•How To Get Tax Help
oThe Taxpayer Advocate Service Is Here To Help You
oLow Income Taxpayer Clinics
What this publication covers. This publication discusses NOLs for individuals, estates, and trusts. It covers:
•How to figure an NOL,
•When to use an NOL,
•How to claim an NOL deduction, and
•How to figure an NOL carryover.
To have an NOL, your loss must generally be caused by deductions from your:
•Trade or business,
•Work as an employee,
•Casualty and theft losses,
•Moving expenses, or
•Rental property.
A loss from operating a business is the most common reason for an NOL.
Partnerships and S corporations generally cannot use an NOL. However, partners or shareholders can use their separate shares of the partnership's or S corporation's business income and business deductions to figure their individual NOLs.
Keeping records. You should keep records for any tax year that generates an NOL for 3 years after you have used the carryback/carryforward or 3 years after the carryforward expires.
•NOL Steps
•How To Figure an NOL
oNonbusiness deductions (line 6).
oNonbusiness income (line 7).
oNonbusiness capital losses.
oBusiness capital losses.
oForm 1045, Schedule A Example
•When To Use an NOL
oExceptions to 2-Year Carryback Rule
oWaiving the Carryback Period
oHow To Carry an NOL Back or Forward
•How To Claim an NOL Deduction
oDeducting a Carryback
oDeducting a Carryforward
oChange in Marital Status
oChange in Filing Status
•How To Figure an NOL Carryover
•NOL Carryover From 2014 to 2015
oWorksheet Instructions
•How To Get Tax Help
oThe Taxpayer Advocate Service Is Here To Help You
oLow Income Taxpayer Clinics
