Tax Type
Corporation Income Tax
Description
Net Operating Loss carryover; Combined return
Topic
Returns/Payments/Records
Date Issued
04-28-1993
April 28, 1993
Re: §58.1-1821 Application: Corporation Income Tax
Dear*************
This is in response to your letters of September 22, 1989 and April 2, 1992, requesting the Department to issue a ruling permitting the use of the net operating loss ("NOL") carryover of a member of a combined return affiliated group to offset the incomes of the other members of the group.
DETERMINATION
The ability of members of an affiliated group to use the NOL carryover of another member of the group has previously been addressed by this Department. In Public Document ("P.D.") 88-303 (October 31,1998), a copy of which is attached, I ruled that Virginia law permits the use of the NOL of one member of the group to offset the income of the other group members only in the year the NOL is incurred. Virginia law does not permit the use of an NOL carryover or carryback to offset the income of any other affiliate in any other taxable year
The policy articulated in P.D.88-303 has been incorporated into §6 of Virginia Regulation 630-3-442 adopted on March 10, 1993, a copy of which is also enclosed.
Accordingly, your request is denied.
Sincerely,
W. H. Forst
Tax Commissioner
OTP/6889L
Rulings of the Tax Commissioner