What do I do with tax returns aleady filed in early March, 2020 that had NOL’s carried forward without an election to carryforward? Client does not wish to carryback but we didn’t make an election to carryforward because it wasn’t required prior to change made March 20th, 2020. Are we okay to just leave it be?
You are required to make the election to forego the carryback on the first income tax return filed for your client that is due after March 27, 2020. So, if you have a calendar year business, you will make the election to forego the carryback of the 2018 and 2019 NOLs on their 2020 return.