The Worker, Homeownership and Business Assistance Act, signed into law in early November 2009, gives a valuable tax break to businesses that have incurred net operating losses in 2009. Under the general rule, a business owner is permitted to carry back a NOL for two years and deduct it against taxable income for those two years. The new November 2009 provision extends the time period and allows business owners to carry back a NOL for three, four and even five years. Given the current credit crunch and the tough economic climate, this new provision creates a valuable tax break for many business owners.

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