A Corporation Generates a $200,000 Net Operating Loss in 2018

question 1253

Multiple Choice

A corporation generates a $200,000 net operating loss in 2018. In 2019 its taxable income from 2019 activities is $220,000. The corporation will be allowed an NOL deduction of

• A) $220,000.
• B) $176,000.
• C) $160,000.
• D) $200,000.

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Definitions:

Annuity Cost

The initial investment or premium required to purchase an annuity, which in return provides periodic payments for a specified period or for life.

Pretax Return

The financial return on an investment before any taxes are deducted.

Taxable Investor

An individual or entity that is subject to taxes on investment income and capital gains, affecting investment choices and strategies to minimize tax liabilities.

After-tax Return

The profit realized from an investment after all applicable taxes have been subtracted, representing the actual benefit to the investor.