Susan G. Kilburg - Page 5

                                        - 4 -                                         
          determination had the effect of reducing the amount available for           
          carryover to the 1998 year from $118,960 to $27,424.  After                 
          obtaining evidence of petitioner's filing for 1993, respondent              
          moved to increase the deficiency in this case due to the                    
          carryback of the 1996 loss to 1993 as well as the 2 subsequent              
               The parties agree that petitioner incurred an operating                
          loss.  The only issue for the Court to decide with respect to the           
          NOL is whether petitioner must carry it back to the 3 preceding             
          taxable years before any portion may be carried forward.  Because           
          the Court decides the issue in this case without regard to the              
          burden of proof, section 7491 is inapplicable.                              
               For the years involved here, a taxpayer may carry back an              
          NOL to the 3 years before the loss year, and then forward to each           
          of the 15 years following the loss year.  Sec. 172(b)(1)2.  A               
          taxpayer may elect to forgo the carryback period.  Sec.                     
          172(b)(3).  The election must be made by the due date, including            
          extensions, for filing the taxpayer's return for the year the NOL           

               1In his answer, respondent alleges that "After carrying back           
          the NOL to 1993, the 1996 NOL carryforward to 1998 is decreased             
          from $91,536 stated in the notice of deficiency to $27,242".                
          This allegation appears to be erroneous.                                    
               2With respect to net operating losses for taxable years                
          beginning after the date of enactment of the Taxpayer Relief Act            
          of 1997, Pub. L. 105-34, sec. 1082(a)(1) and (2), 111 Stat. 950,            
          the carryback and carryover periods were changed.                           

Page:  Previous  1  2  3  4  5  6  7  8  9  Next

Last modified: May 25, 2011