Nol Carryback Rules For 2025 Tax Year. We will need to wait for guidance from sacramento and the ftb to determine whether california will allow taxpayers to claim the loss in 2024 or allow a carryback of a loss incurred. In general, prior to the tcja, an nol could be carried back up to two tax years and forward up to 20 tax years to offset taxable income.

A net operating loss (nol) or tax loss carryforward is a tax provision that allows firms to carry forward losses from prior years to offset future profits, and, therefore, lower future income taxes. Under current rules, this limitation applies to the aggregate of all your business losses and is capped at $524,000 for married taxpayers filing jointly and $262,000 for single.