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Carryback net operating loss calculations

Net Operating Losses (NOL) from farming operations need to be carried back using either Form 1045 or Form 1040X, unless you mark the
Elect to relinquish carryback of farm NOL incurred during the current tax year
 checkbox on the
1045
 screen in the
1045 & NOL
 folder. This topic cover NOL carrybacks on Form 1045.
  • If the NOL is more than the modified taxable income for the earliest year to which it's carried back, Form 1045 Schedule B (in Forms view, in the
    1045
     folder, then the
    P4
     tab) in the current year is used to figure the amount of the NOL to be carried to the next year in the carryback period. The carryforward amount is calculated on Form 1045, Schedule B, line 10, and is based on amounts entered on the
    1045-4
     screen. Verify for accuracy any proforma'd information on the screen.
  • Form 1045, Schedule B, line 9 may be limited to 80% of taxable income figured without any NOL deduction.
  • If the NOL isn't fully utilized within the carryback period, the remaining amount will show on the Net Operating Loss Carryover Calculation Worksheet 3 as a carryover to the next year.
  • An NOL carryback from years after 2017 is limited to 80% of taxable income computed without the net operating loss deduction. You may need to adjust the amount carried back to conform with this limitation.
  • Examine prior returns for charitable contributions. Don't reduce the adjusted gross income used to limit charitable contributions by the carryback amount. Force Schedule A to keep the original amount of the Schedule A charitable deduction.
  • To determine the Net Investment Income Applicable Percent of NOL, refer to Form 8960, Worksheet 4, in the current year of UltraTax CS.

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