Current through Register No. 13, March 27, 2025
(a) Section 172 of
the IRC for purposes of calculating the amount of any net operating loss
deduction allowed under RSA 77-A:4II, XI, shall be followed, except:
(1) The carryback of loss required by IRC
section 172 (b)(1) is not required for New Hampshire's purposes; and
(2) The amount is limited as provided in (c),
(d), and (e), below.
(b)
Net operating losses may be carried forward for 10 years following the loss
year.
(c) Business organizations,
subject to RSA
77-A:3, regarding the apportionment of income
shall apportion any net operating loss carried forward using the formula
provided in RSA
77-A:3 and Rev 304.
(d) Combined groups with more than one member
subject to RSA 77-A shall:
(1) Calculate
separate apportionment percentages for each business organization as follows:
a. The denominators used to calculate these
percentages shall be the sales, payroll, and property denominators of the
combined group for tax periods ending before December 31, 2022, and shall be
the sales denominator of the combined group for tax periods ending on or after
December 31, 2022; and
b. The
numerators shall be the New Hampshire sales, payroll, and property of each
respective business organization subject to RSA 77-A for tax periods ending
before December 31, 2022, and shall be the sales numerators of each respective
business organization subject to RSA 77-A for tax periods ending on or after
December 31, 2022;
(2)
Treat each business organization's apportioned share of the combined loss
amount as a tax attribute which remains with that business
organization;
(3) Total the
apportioned loss carry forward amounts of each business organization in the
combined group possessing such tax attributes; and
(4) Apply the result in (3) above as a
deduction from the gross business profits of the combined group after
apportionment under RSA 77-A:3 in the taxable period
in which the deduction is to be used.
(e) The net operating loss carry forward
calculated in either (a), (c), or (d) above, shall be limited as provided in
RSA 77-A:4II, (a), (b), (c), (d), and (e), XI for each business
organization.
(f) The resulting net
operating loss shall be applied to the gross business profits after
apportionment under RSA 77-A:3.
(g) Business organizations availing
themselves of the net operating loss deduction shall:
(1) Maintain detailed records that confirm
each step in the calculation of the:
b. Net operating
loss carry forward; and
c. Net
operating loss deduction amounts; and
(2) Retain the federal and state tax returns
and the detailed records relating to a net operating loss for all taxable
periods to which the net operating loss relates.
(h) During a department audit of a taxable
period where a New Hampshire net operating loss deduction is taken on a return,
within the statute of limitations, the business organization shall:
(1) Provide the department with all state and
federal tax returns and detailed records with an impact on the proper
calculation of the deduction taken by the business organization;
(2) Not receive a refund for a prior year
overpayment nor be assessed additional tax liability for prior year
deficiencies resulting from an inquiry that reveals adjustments to prior
taxable period net operating loss calculations would be appropriate in the
liability of the business organization in any of the prior taxable periods
outside the statute of limitations;
(3) Deduct the appropriate New Hampshire net
operating loss deduction in the audit years as if the extra-statutory year
adjustments had been made; and
(4)
Adjust the carry forward amount in the years subsequent to the audit
year.
#2012, eff 5-5-82; amd by #2403, eff 6-27-83; ss by #2722,
eff 5-23-84; ss by #4192, eff 12-23-86; ss by 5355, eff 3-16-92; ss by #5490,
eff 10-19-92; ss and moved by #6853, eff 9-23-98 (from
Rev
303.04); rpld and ss by #8709, eff <br> 8-25-06;
amd by #10233, eff 11-21-12
