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Daily Tax Report: State

Arkansas Appeals Office Finds Taxpayer Precluded From Claiming Net Operating Loss Deduction, Sustains Assessment

Dec. 2, 2019, 10:43 PM

The Arkansas Office of Hearings and Appeals (OHA) Nov. 27 sustained the Department of Finance and Administration’s (DFA) individual income tax assessment, finding Taxpayer was precluded from claiming a net operating loss (NOL) deduction. Taxpayer, a businessman, claimed a NOL carryover deduction based on a judgment debt. After five years, Taxpayer took out a loan to satisfy the judgment debt and continued to claim NOL. The DFA issued a notice of proposed assessment, determining Taxpayer couldn’t claim an additional NOL based on the loan principal payments. The OHA found: 1) Taxpayer had already claimed the maximum 5 years carryover NOL...

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