Klaus Fedfelt | Getty Images
The coronavirus has marginalized thousands of businesses, but there may be a glimmer of hope for businesses struggling with cash.
Businesses affected by the pandemic and lockdowns in the community now need money. One of the best ways to do this is to take advantage of very favorable rule changes in the treatment of net operating losses in the CARES Act.
A company suffers NOL when its tax deductions exceed its income in a given year. In general, taxpayers can lower their taxes by using that loss to offset income in a future year.
The CARES Act goes one step further and allows abused businesses to convert this year’s red ink into a tax refund on previous years’ income.