Sec. 241. Five-year carryback of net operating losses and temporary suspension of taxable income limitation
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Section 172 of the Internal Revenue Code of 1986 is amended by redesignating subsection
(g)as subsection
(h)and by inserting after subsection
(f)the following new subsection: 2018, 2019, and 2020 For purposes of this section— Any net operating loss arising in a taxable year beginning after December 31, 2017, and before January 1, 2021— shall be a net operating loss carryback to each of the 5 taxable years preceding the taxable year of such loss (but not to any taxable year beginning before January 1, 2015), and subparagraphs
(B)and (C)(i) of subsection (b)(1) shall not apply. A taxpayer may elect not to have subparagraph
(A)apply for any taxable year. Such election shall be made in such manner as may be prescribed by the Secretary, and shall be made— in the case of any election relating to a net operating loss arising in a taxable year beginning in 2018 or 2019, by the due date (including extension of time) for filing the return for the taxpayer’s first taxable year ending after the date of the enactment of this subparagraph. in the case of any election relating to a net operating loss arising in a taxable year beginning in 2020, by the due date (including extensions of time) for such taxable year. Any such election, once made, shall be irrevocable. For taxable years beginning after December 31, 2017, and before January 1, 2021, the amount of the deduction allowed under subsection
(a)shall be the aggregate of the net operating loss carryovers to such year, plus the net operating loss carrybacks to such year. Paragraphs
(1)and
(2)shall not apply with respect to any taxable year in which the taxpayer is a disqualified taxpayer. Any taxpayer who is a disqualified taxpayer in the first taxable year ending after the date of the enactment of this paragraph, shall be treated as a disqualified taxpayer for taxable years beginning on or after January 1, 2018. For purposes of this subsection— A taxpayer is a disqualified taxpayer with respect to a taxable year if— in the case of a taxable year ending after December 31, 2019, and beginning before January 1, 2021, the taxpayer (or any related person) is not allowed a deduction under this chapter for the taxable year by reason of section 162(m) or section 280G, or the taxpayer (or any related person) is a specified corporation for the taxable year. The term specified corporation means, with respect to any taxable year, a corporation the aggregate distributions (including redemptions) of which during any taxable year ending after December 31, 2017, exceed the sum of applicable stock issued of such corporation and 5 percent of the fair market value of the stock of such corporation as of the last day of the taxable year. The term applicable stock issued means, with respect to any corporation, the aggregate value of stock issued by the corporation during any taxable year ending after December 31, 2017, in exchange for money or property other than stock in such corporation. For purposes of clause (i), stock described in section 1504(a)(4), and distributions (including redemptions) with respect to such stock, shall be disregarded. A person is a related person to a taxpayer if the related person bears a relationship to the taxpayer specified in section 267(b) or section 707(b)(1). In the case of a net operating loss of a life insurance company which arises in a taxable year beginning after December 31, 2017, and before January 1, 2021, and which is a net operating loss carryback to a taxable year beginning before January 1, 2018, such net operating loss shall be treated as an operations loss deduction under subchapter L (as in effect before the enactment of Public Law 115–97 ) with respect to such taxable year in the same manner as a loss arising in a taxable year beginning before January 1, 2018. . Section 965(n) of such Code is amended by adding at the end the following new paragraph: In the case of a net operating loss carryback to such taxable year by reason of section 172(g)(1), the taxpayer shall be treated as having elected the application of this subsection for such taxable year. . Section 172(b)(1) of such Code is amended by inserting and subsection
(g)after this paragraph . The Secretary of the Treasury (or the Secretary’s delegate) shall prescribe such regulations or other guidance as are necessary or appropriate to prevent the abuse of the purposes of the amendments made by this section, including— anti-stuffing rules, anti-churning rules (including rules relating to sale-leasebacks), and rules similar to the rules under section 1091 of the Internal Revenue Code of 1986 relating to losses from wash sales, rules applying this subsection to successor corporations and in cases where a taxpayer becomes, or ceases to be, a member of an affiliated group filing a consolidated return under section 1501 of such Code, rules treating members of an affiliated group filing a consolidated return under section 1501 of such Code as a single corporation, and rules to prevent the avoidance of this section through related parties, pass-through entities, and intermediaries. Rules similar to the rules of subparagraphs
(B)and
(D)of section 172(b)(1) of the Internal Revenue Code of 1986, as in effect on the day before the date of the enactment of Public Law 115–97 , shall apply to any net operating loss to which the amendment made by this section applies. The Secretary of the Treasury (or the Secretary’s delegate) shall prescribe such regulations or other guidance as are necessary or appropriate to effect the purposes of such subparagraphs with respect to any such net operating losses. Except as provided in paragraph (2), the amendments made by subsections
(a)shall apply to— taxable years beginning after December 31, 2017, and taxable years beginning on or before December 31, 2017, to which net operating losses arising in taxable years beginning after December 31, 2017, are carried. In the case of the amendments made by subsections
(b)and (c), and so much of subsection
(a)as relates to the carryback of net operating losses, such amendments shall apply to net operating losses arising in taxable years ending after December 31, 2017, and beginning before January 1, 2021.
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Sec. 241
Five-year carryback of net operating losses and temporary suspension of taxable income limitation
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