Pennsylvania net operating loss cap deduction increases enacted in 2017 are now effective.
The net loss cap is now 35% of taxable income in 2017 and 40% of taxable income in 2018 and after.
The change takes effect after the PA Department of Revenue published a notification that all or a part of the net loss deduction has been deemed unconstitutional as a result of a decision by the Pennsylvania Supreme Court. The court issued a decision in October 2017 that found the flat $3 million net loss deduction carryover provision unconstitutional.
If you have any questions or if you would like more information, contact Fred Schutz at (856) 722-5300 ext. 201 or Dave Gill at ext. 210.