Question

Suppose your firm had the following taxable income amounts: 2012 ($2 million) operating loss 2013 ($2 million) operating loss 2014 ($2 million) operating loss 2015 $10 million After you "carry forward" the operating losses, what is the effective taxable income for 2015?

A. $1 million
B. $4 million
C. $0
D. $3 million
E. $2 million

Answer 1

Answer:

Calculation of table income.

Any NOL can be set off with future operating income upto 20 year.

Year NOL/NOG

2012                       (2)

2013                       (2)

2014                       (2)

2015                       10

Taxable income                          4

Option B is correct 4 million is taxable income in 2015.