NRF to Senate: Approve tax-refund amendment
Washington, D.C. The National Retail Federation on Tuesday asked the Senate to approve an amendment that would bring struggling retailers and other businesses billions of dollars by lengthening the period during which they can carry back current losses to claim a tax refund from previous years when they made a profit.
“For retailers struggling in the current recession, NOL (net operating loss) carryback provides an important source of capital to finance ongoing operations and retain employees,” NRF senior VP for government relations Steve Pfister said.
“Because retail sales have fallen so dramatically over the past year and access to capital has been so limited, retailers are experiencing severe challenges in finding the cash they need to operate their businesses as the economy moves toward recovery.”
Pfister’s comments came in a letter to leadership and members of the Senate, which is expected to consider legislation extending unemployment insurance benefits this week.
Carryback is normally limited to two years, but economic stimulus legislation signed into law in February expanded the period to five years for companies with up to $15 billion in annual gross receipts. Larger businesses are still restricted to two years.
Details are still being worked out, but the amendment is expected to expand the five-year period to include all businesses that suffer a loss regardless of size, and to give companies the choice of using the carryback for losses from either 2008 or 2009 rather than just 2008 as provided in the stimulus bill.