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previous page Previous Page: Publication 535 - Business Expenses - How To Get Tax Help
next page Next Page: Publication 536 - Net Operating Losses (NOLs) for Individuals, Estates, and Trusts - How To Figure an NOL
 Use previous pagenext page to find additional occurrences of topic items.Index for this Publication
taxmap/pubs/p536-000.htm#en_us_publink100096414
Publication 536

 
Net Operating Losses (NOLs) for 
Individuals, Estates, and Trusts


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What's New(p1)


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taxmap/pubs/p536-000.htm#en_us_publink1000138472

5-year carryback of 2008 NOLs for eligible small businesses.(p1)

For 2008, you can choose a 3, 4, or 5-year carryback period for the part of your 2008 NOL that is an eligible small business loss. See Eligible small business (ESB) loss, later.
taxmap/pubs/p536-000.htm#en_us_publink1000150467

Tax relief for federally declared disaster areas.(p1)

A 5-year carryback period applies to the portion of an NOL that is a qualified disaster loss. See Qualified disaster loss, later.
taxmap/pubs/p536-000.htm#en_us_publink1000150464

Tax relief for the Kansas disaster area.(p1)

A 5-year carryback period applies to the portion of an NOL that is a qualified recovery assistance loss. See Qualified recovery assistance loss, later.
taxmap/pubs/p536-000.htm#en_us_publink1000150466

Tax relief for the Midwestern disaster areas.(p1)

A 5-year carryback period applies to the portion of an NOL that is a qualified disaster recovery assistance loss. See Qualified disaster recovery assistance loss, later.
taxmap/pubs/p536-000.htm#en_us_publink1000150468

Qualified GO Zone loss.(p1)

The definition of qualified GO Zone loss no longer includes certain deductions that expired before 2008. See Qualified GO Zone loss, later. For a list of the deductions that have expired, see page 6 of Publication 4492. (See Publication 4492, pages 12 and 13, for the special depreciation allowance.

Reminder(p2)


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taxmap/pubs/p536-000.htm#en_us_publink100096416

Photographs of missing children.(p2)

The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

taxmap/pubs/p536-000.htm#TXMP5ae158cdIntroduction

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.
taxmap/pubs/p536-000.htm#en_us_publink100096417

What this publication covers.(p2)


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This publication discusses NOLs for individuals, estates, and trusts. It covers:
To have an NOL, your loss must generally be caused by deductions from your:
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.
taxmap/pubs/p536-000.htm#en_us_publink100096418

Keeping records.(p2)


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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.
taxmap/pubs/p536-000.htm#en_us_publink100096419

What is not covered in this publication?(p2)


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The following topics are not covered in this publication.
taxmap/pubs/p536-000.htm#en_us_publink1000148771

Comments and suggestions.(p2)


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We welcome your comments about this publication and your suggestions for future editions.
You can write to us at the following address:

 
Internal Revenue Service 
Individual Forms and Publications Branch 
SE:W:CAR:MP:T:I 
1111 Constitution Ave. NW, IR-6526 
Washington, DC 20224


We respond to many letters by telephone. Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence.
You can email us at *taxforms@irs.gov. (The asterisk must be included in the address.) Please put "Publications Comment" on the subject line. Although we cannot respond individually to each email, we do appreciate your feedback and will consider your comments as we revise our tax products.
taxmap/pubs/p536-000.htm#en_us_publink1000148772

Ordering forms and publications.(p2)
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Visit www.irs.gov/formspubs to download forms and publications, call 1-800-829-3676, or write to the address below and receive a response within 10 days after your request is received.

 
Internal Revenue Service 
1201 N. Mitsubishi Motorway 
Bloomington, IL 61705-6613


taxmap/pubs/p536-000.htm#en_us_publink1000148773

Tax questions.(p2)
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If you have a tax question, check the information available on www.irs.gov or call 1-800-829-1040. We cannot answer tax questions sent to either of the above addresses.

taxmap/pubs/p536-000.htm#TXMP010e2680

Useful items

You may want to see:


Publication
 4492 Information for Taxpayers Affected by Hurricanes Katrina, Rita, and Wilma
 4492-A Information for Taxpayers Affected by the May 4, 2007, Kansas Storms and Tornadoes
 4492-B Information for Affected Taxpayers in the Midwestern Disaster Areas
Form (and Instructions)
 1040X: Amended U.S. Individual Income Tax Return
 1045: Application for Tentative Refund
 
See How To Get Tax Help near the end of this publication for information about getting these publications and forms.
taxmap/pubs/p536-000.htm#en_us_publink100096423

NOL Steps(p2)


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previous topic occurrence Net Operating Loss next topic occurrence

Follow Steps 1 through 5 to figure and use your NOL.
taxmap/pubs/p536-000.htm#en_us_publink100096424

Step 1.(p2)


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Complete your tax return for the year. You may have an NOL if a negative figure appears on the line below:
If the amount on that line is not negative, stop here — you do not have an NOL.
taxmap/pubs/p536-000.htm#en_us_publink100096425

Step 2.(p2)


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Determine whether you have an NOL and its amount. See How To Figure an NOL, later. If you do not have an NOL, stop here.
taxmap/pubs/p536-000.htm#en_us_publink100096426

Step 3.(p2)


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Decide whether to carry the NOL back to a past year or to waive the carryback period and instead carry the NOL forward to a future year. See When To Use an NOL, later.
taxmap/pubs/p536-000.htm#en_us_publink100096427

Step 4.(p2)


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Deduct the NOL in the carryback or carryforward year. See How To Claim an NOL Deduction, later. If your NOL deduction is equal to or less than your taxable income without the deduction, stop here — you have used up your NOL.
taxmap/pubs/p536-000.htm#en_us_publink100096428

Step 5.(p2)


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Determine the amount of your unused NOL. See How To Figure an NOL Carryover, later. Carry over the unused NOL to the next carryback or carryforward year and begin again at Step 4.
taxmap/pubs/p536-000.htm#en_us_publink100096429

Note.(p2)


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If your NOL deduction includes more than one NOL amount, apply Step 5 separately to each NOL amount, starting with the amount from the earliest year.
previous pagePrevious Page: Publication 535 - Business Expenses - How To Get Tax Help
next pageNext Page: Publication 536 - Net Operating Losses (NOLs) for Individuals, Estates, and Trusts - How To Figure an NOL
 Use previous pagenext page to find additional occurrences of topic items.Index for this Publication