Personal Income Tax Law: net operating loss.

The Personal Income Tax Law and the Corporation Tax Law, in modified conformity with federal income tax laws, allow various deductions in computing the income that is subject to the taxes imposed by those laws, including a deduction for a net operating loss, as specified. Existing law, the federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) , among other things, authorizes, with respect to a taxable year beginning on or after January 1, 2018, and before January 1, 2021, a net operating loss carryback to each of the 5 taxable years preceding the taxable year of that loss. This bill would, under both laws, conform to the provision of the CARES Act described above and would authorize a taxpayer to file a return for the first six months of a taxable year if that return includes a claim for a net operating loss carryback pursuant to that provision. The bill would also make legislative findings and declarations regarding the public purpose served by the bill. Existing law requires any bill authorizing a new tax expenditure to contain, among other things, specific goals, purposes, and objectives that the tax expenditure will achieve, detailed performance indicators, and data collection requirements. The bill also would include additional information required for any bill authorizing a new tax expenditure.