Scenario 10

When there is a negative Federal Taxable Income (Pre-NOL), the NOL Allowance Rate and the Base NOL Allowance do not affect the NOL Reclass. This occurs because the negative Taxable Income is considered a loss and is added to the NOL Balance Sheet.

If the NOL Reclass is added to the Federal Taxable Income (Pre-NOL), the Federal Taxable Income (Post-NOL) is 0.

-52,000 <TI Pre-NOL> + 52,000 <NOL Reclass> = 0 <TI Post-NOL>

NOL Ending Balance

(Beginning Bal + Deferred Only + Balance Sheet Only) + (NOL Reclass) = NOL End Bal

(10,000 <BBal> + 0<DO> + 0 <Bal O>) + (52,000 <NOL Reclass>)  = 62,000 <EB>

Note: To access the report, select the Reporting area, Dataset, and Report Level.  Then, in the navigator select Tax Provision and click Run.  View Detail.  On the report, select the View Detail hyperlink.