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From: dgh@sun.uucp (David Hough)
Newsgroups: net.taxes
Subject: Re: Income Averaging
Message-ID: <2001@sun.uucp>
Date: Wed, 20-Feb-85 22:15:21 EST
Article-I.D.: sun.2001
Posted: Wed Feb 20 22:15:21 1985
Date-Received: Thu, 21-Feb-85 08:50:21 EST
References: <2410@hplabsc.UUCP>
Reply-To: dgh@sun.UUCP (David Hough)
Organization: Sun Microsystems, Inc.
Lines: 19
Summary: 

In article <2410@hplabsc.UUCP> johnson@hplabsc.UUCP (Mark Scott Johnson) writes:
>
>There is provision in the tax code for companies to average losses
>against previous gains, but to the best of my knowledge there is no
>equivalent provision for individuals.
>-- 
>Mark Scott Johnson

Net operating losses may be carried back three years by individuals as
well as corporations, but the rules are quite complex.   Most individuals
do not have a net operating loss unless they have an extremely unprofitable
business loss on schedule C or or E or F.  It's not a matter of averaging 
at all, merely using this year's loss to reduce previous years' taxable income.

There is an IRS publication on net operating losses which explains the
calculation in detail.

David Hough