I cannot thank you ENOUGH for all these insightful videos. You explain it way better than my $2000+ CPA package. -From a non-accounting major studying for CPA test. Thank you, thank you, thank you.
You explain literally everything better (more clearly) than most of the teachers I have ever had and I have been to school 3 years at University of Delaware and 3 years at Rutgers Business School-Newark....two semi good schools. Thank you...you are going to make me pass my Intermediate 2 Accounting class.
For anyone watching recently, know that the rules have changed. NOLs arising in tax years after 2017 can be carried forward indefinitely, but can only offset a maximum of 80% of taxable income in any given year.
Thank you so much for the videos. I am having trouble understanding my professor who teaches this because he only teaches from the book and doesn’t do many (if any) in class examples
why a company will carry foward profits? or why looking at a quaterly return a company will have in dec 70M profit carried forward and 3 months later 180M?
how do you determine the tax rate of year 4 to be 40% since that year we have a loss. in addition, you credit income tax expense for 56800, that is a negative expense amount, can we still call it expense, or we should call it income?
In my CPA review book, It debits a Tax refund receivable and credits a Tax benefit (instead of a income tax expense) for the Carryback. Is this because they do not like the idea of reversing an interest expense?
Could be, sometimes people get confused when an expense is credited. Companies title their accounts differently, so a journal entry would look slightly different from one company to the next, but the effect will be the same. A through journal entry for this transaction might be: debit: Income Tax Refund Refund Receivable credit: Benefit Due to Income Tax Carryback (Income Tax Expense)
If I lost money last 7 years and made Money this year can I deduct the tax from previous years loss in USA ? If yes how many years I can go back for loss ? Some countries you can go 5 years back of losses.
Ok. I’m back again. HELP ME PLEASE!!! Please explain the difference between an NOL and a section 465(d) carryover. I’ve searched everywhere and can not find an answer to that question. How are they different? How do they get reported? TurboTax calculated a net loss of $ -11,915 on line 31 on my schedule c in 2013. (Just using these years as examples.) In 2014,TurboTax autopopulated $ 11,915 as Section 465(d) carryover in Part V - Other Expenses of that year’s Schedule C. On my 1040 for 2013, Line 22 Total Income is $ -13,461. For 2014 it was $ -12,011. So, shouldn’t a NOL come into play somewhere? But how? Ugh?? Do you have another video that can help with these questions? Thank you so very, very much.
What about the current tax reporting period? If NOL year was 2017, will I be eligible for a tax refund in 2017 or only in subsequent years, should I choose to carry it forward?
If you paid taxes the last 2 years, you would be eligible for a refund if you carry the losses back. You could also carry the losses forward for 20 years. It is typically preferrable to carry losses back due to the time value of money. Any taxes that were paid during the year would also be refunded with your 2017 tax return.
