AN OCTOBER 31 DEADLINE is looming.
The US economic stimulus bill last March opened the door for companies that will report net operating losses on their tax returns for last year — or that can generate such losses this year — to get refund checks from the US Treasury for taxes they paid as far back as 1996. In the past, losses could only be carried back two years.
The IRS said in late May that companies that have already elected to forego any carryback of losses — before realizing that a longer carryback is allowed — or that chose earlier to take advantage only of a two-year carryback — can still change their minds. However, they must act by October 31. The IRS announcement is Revenue Procedure 2002-40.