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Business & farm
In addition to what has been posted:
- As you stated, in general, C corporation NOL's cannot be used during the S election period
- An exception to this, is if the S corporation is subject to the BIG (built-in gains tax).
- If the S corporation is subject to the BIG, C corp net operating losses can be used to offset the built-in gain; which reduces any BIG tax. IRC 1374(b)(2)
- Additionally, if the S status is lost or terminated in the middle of a tax year, the short S period and short C period is treated as one year; essentially the short S year is disregarded when determining carryover period years. IRC 1362(e)(6)(A)
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
Also keep in mind the date of replies, as tax law changes.
May 3, 2024
1:31 PM
6,055 Views