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24416 Form 1 Net Operating Loss NOL Computation and

24416 Form 1 Net Operating Loss NOL Computation and

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hello and welcome to this session this is Professor forehead in which we will discuss net operating loss for short nol so what is net operating loss simply put net operating loss is when the taxpayer annual business deduction we know it as business expenses or business deduction are greater than the annual business income simply put we have negative income negative income is the same thing as a loss therefore what we have is an operating loss and this net operating loss is Created from a trade or a business and Casualty losses those are the items that generally create net operating loss and ol now why do we have this nol what is the benefit of it what is the importance of it let me show you an example with two taxpayers to show you why Congress has this Rule net operating law let's assume two taxpayer Adam and Avi their single taxpayer they started their business in year one and they reported the following income for Adam Adam reported in year one taxable income of twenty thousand and

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