NOL-F85: Computation of Net Operating Loss – Fiduciary Return (Form 41) (2024)
Alabama · Alabama DOR · Used for tax years 2024
Alabama Form NOL-F85 computes an estate or trust’s allowable net operating loss for Form 41 and determines the amount that can be carried back or forward to another tax year. It also includes an election to forfeit the carryback and carry the loss forward only.
Who files this form
Form NOL-F85 is used to calculate a net operating loss for a fiduciary return (Form 41) and determine the amount that can be carried back or forward to another tax year. It also includes an ESBT NOL calculation.
If the result on line 17 is zero or positive, do not file this form. The form states that you do not have an allowable net operating loss.
What you'll need
Have these forms and details available to complete the calculation:
- Alabama Form 41, including the income amounts and fiduciary exemption referenced on NOL-F85.
- Schedule ESBT, if using the ESBT NOL calculation. The form specifically references Schedule ESBT, line 20.
- The estate or trust name as shown on Form 41, its Federal Employer Identification Number, and the loss year ending date.
- Nonbusiness deductions claimed on Form 41 or Schedule ESBT, including interest paid, taxes paid, losses on sales of nonbusiness assets, and other nonbusiness deductions.
- Nonbusiness income reported on Form 41 or Schedule ESBT, including dividends, interest, federal income tax refunds, estate or trust income, gains on sales of nonbusiness assets, and other nonbusiness income.
Common mistakes
- Completing Part III when carrying the loss back. The form expressly warns not to complete Part III if you are carrying the loss back.
- Including the income distribution deduction in the line 13 calculation. The form says this calculation cannot include the deduction on Form 41, page 1, line 2.
- Filing when line 17 is zero or positive. The form says to stop and not file because there is no allowable net operating loss.
Questions people ask
What does Form NOL-F85 calculate?
It calculates the amount of a net operating loss originating in a tax year and determines how much can be carried back or forward to another tax year.
How do I calculate excess nonbusiness deductions?
If total nonbusiness deductions on line 4 exceed total nonbusiness income on line 11, subtract line 11 from line 4. Enter the result on lines 12 and 15. If line 11 exceeds line 4, enter zero on both lines.
What happens if line 17 shows a negative amount?
You may elect to carry the loss forward. Otherwise, the form says it must be carried back two years, and any unused portion may then be carried forward to succeeding years.
How do I elect to give up the carryback?
Check the box in Part III to elect to forfeit the carryback and instead carry forward any allowable net operating loss for the taxable year. Do not complete Part III if you are carrying the loss back.