Tax Type
Corporation Income Tax
Description
Reorganizations; Survival of net operating loss deduction
Topic
Computation of Income
Date Issued
04-21-1997
April 21, 1997
Re: Request for Ruling: Corporate Income Tax
Dear**************
This will respond to your letter of February 19, 1997, requesting a ruling on net operating loss deductions for Virginia corporation income tax purposes. Specifically, you request whether a NOLD of a merged corporation that filed a separate Virginia return may be used against income of the survivor of the merger (the "Parent") which had not previously filed a Virginia return.
RULING
The ability of a "Parent" corporation as survivor of a statutory merger to succeed to certain tax attributes of a merged corporation under Internal Revenue Code (IRC) 381 (a) has previously been addressed by the department. In Public Document (P.D.) 96-38 (4-5-96), copy attached, I ruled that a taxpayer may use the separate company net operating loss deductions of the merged companies for Virginia tax purposes. Therefore, to the extent that such carryforwards are allowable for federal income tax purposes if separate federal returns had been filed, they would be allowable for Virginia income tax purposes.
If you have any questions regarding this ruling, please contact **** at ********.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/12205P
Rulings of the Tax Commissioner