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A taxpayer with a farming loss maybe   elect to waive the carryback period for a net...

A taxpayer with a farming loss maybe   elect to waive the carryback period for a net operating loss (NOL) by:

a Attaching a statement to the reuturn for the carryforward year.

b Filing an amendment for the NOL year return.

c Filing an amendment claiming the election for the carryback year.

d Attaching a statement to the tax return for the loss year, filed on or before the due date, including extensions.

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Answer #1

The correct answer for the question is Option D - Attaching a statement to the tax return for the loss year, filed on or before the due date, including extensions. The IRS offers the flexibility of waiving of the carryback period for a net operating loss by allowing the taxpayer by attaching a statement to the tax return for the loss year, that is filed on or before the due date and including any timing extensions as given by the IRS. If this statement is not filed, generally carrybacks are not accepted.

Option A is incorrect. This option is for a carryforward period and not the Carryback period.

Option B and Option C are incorrect as Amendments are not enough in the taxpayer being able to detect the farming loss by making use of the Carryback feature of the IRS.

Please let me know if you have any questions via comments and all the best :) !

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