Taxpayers are allowed to carryback a net operating loss to the two previous tax years. Any remaining amount of net operating loss can be carried forward for up to fifteen years following the loss year.
Taxpayers are allowed to forego the carryback period, and the taxpayer has a choice of two methods for making the election. The election can be made on Alabama Form NOL-85 (Part III), or the election can be made by carrying the loss forward on a timely-filed return for the year subsequent to the loss year.
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