The CARES Act, enacted last March, included a 5-year net operating loss (NOL) carryback for losses incurred in 2018, 2019 and 2020 as well a suspension of the loss limitation rules for those years. This provision, designed to help businesses with liquidity/cash flow issues resulting from the pandemic, has a longstanding history of bipartisan support during difficult economic times.
Senator Sheldon Whitehouse (D-RI) and Representative Lloyd Doggett (D-TX) have initiated a letter to Speaker Pelosi and Majority Leader Schumer calling for a retroactive paring back of the NOL carryback provision, the money from which would be “repurposed to provide relief for families struggling through this challenging time.” The bicameral letter is signed by 120 Democratic members of Congress. It should be noted that Senator Whitehouse and Representative Doggett serve on the Finance and Ways and Means Committees respectively.
In response, a trade association letter is being sent to the Hill opposing any changes to the CARES Act NOL carryback provisions. RILA has signed the letter, which is expected to have at least 70 signatories.
To learn more about this provision and RILA's advocacy efforts, please contact Dave Koenig.
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