Does the CARES Act effect S Corps and shareholders?

Forum|Forum|5 years ago
October 6, 2020
4 replies
28 views

CARES Act: Happen to be amending a 2019 1120S. I am wondering if the CARES Act might

enable S Corp and/or shareholders to apply some of 2020's huge loss to a profitable 2019?

Thanks

ProSeries Professional

This topic has been closed for replies.

Best answer by Accountant-Man

S corps don't have NOLs, so there cannot be any carryback.

Shareholders might have NOLs created when they can claim S corp losses.

Accountant-ManAnswer

Level 13

S corps don't have NOLs, so there cannot be any carryback.

Shareholders might have NOLs created when they can claim S corp losses.

** I am "Elevating with Intention!"

P

PabloAuthor

Level 5

Thank you both very much. Unfortunately that confirms what little I deduced. This fellow is currently on an OIC with IRS. Seemed to recall under the terms, he can't utilize the NOL. I'll verify.

Be well

sjrcpa

Level 15

I don't know why an OIC would preclude using an NOL carryback.

The more I know the more I don’t know.

T

Terry53029

Intuit Community Champion

Here is some info for you from IRS:

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) amended section 172(b)(1) to provide for a carryback of any net operating loss (NOL) arising in a taxable year beginning after December 31, 2017, and before January 1, 2021, to each of the five taxable years preceding the taxable year in which the loss arises (carryback period). Taxpayers may elect under section 172(b)(3) to waive the carryback period for NOLs arising in those years.

Here is link, so you can see the whole article:

https://www.irs.gov/newsroom/frequently-asked-questions-about-carrybacks-of-nols-for-taxpayers-who-have-had-section-965-inclusions

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