Financial Investing

As you might imagine, there have been a number of businesses operating at a loss during 2009. The general rule with business losses is that you can carry them back two years and apply them to income to gain a tax refund. The new tax break allows the loss to be carried back between three and six years. Yes, back to when times were good and a few of us where actually making something called a “profit” instead of sweating our bills. Ah, the good old days! The magic provision is a part of The Worker, Homeownership and Business Assistance Act. It was signed into law on November 1, 2009 by President Obama.

At this point, you might be having a sense of deja vu. Wasn’t this tax break issued a year or two ago? Don’t worry. You are not going crazy. Nearly the same exact tax break was issued as part of the Stimulus act that was issued last February. The difference has to do with a cap.

The Stimulus provision was restricted to businesses with less than $15 million in revenues each year. The new provision in The Worker, Homeownership and Business Assistance Act gets rid of the $15 million dollar cap and makes the tax break available to all businesses.

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