56: Net Operating Loss Schedule 2025 (2025)
Idaho · Idaho Tax Commission · Used for tax years 2025
Idaho Form 56 is the 2025 Net Operating Loss Schedule. It calculates Idaho net operating losses and absorption income for loss or absorption years from 2003 through 2025 using Idaho adjusted income, loss carryforwards or carrybacks, and specified adjustments.
Who files this form
Include Form 56, or your own schedule, with your return for any year you calculate an Idaho net operating loss (NOL). Include Form 56A for the NOL carryforward or carryback calculation, if applicable.
Idaho allows an NOL deduction for individuals, C corporations, trusts, and estates. S corporations and partnerships generally pass losses through to shareholders and partners instead of taking an NOL deduction themselves.
Special rules apply to affected business entities (ABEs). An ABE may carry its NOL forward to later years when it elects to be taxed as an ABE. If it does not make that election in a later year, the unused NOL flows through to its members.
What you'll need
Have the following available, as applicable:
- Your name as shown on the return and your Social Security number or EIN.
- Idaho returns for the loss or absorption years you are calculating, including the income and deduction amounts used on Form 56.
- Form 39R or Form 39NR for individual Idaho NOL deductions and Idaho capital gains deductions.
- Federal Schedule D for the net capital loss deduction claimed on the federal return.
- Federal Schedule A for casualty losses on Idaho property included in itemized deductions.
- Form 56A if you are calculating an Idaho NOL carryforward or carryback.
For tax year 2025, an individual's starting income amount comes from Form 40, line 11, for full-year residents, or Form 43, line 31, column b, for part-year residents and nonresidents.
How to file
Include Form 56, or your own schedule, with the return for any year you calculate an Idaho NOL. Also include Form 56A showing the carryforward or carryback calculation, if applicable.
The supplied text does not give a mailing address or e-filing directions.
Common mistakes
- Using the federal NOL without Idaho adjustments. Idaho calculates its NOL differently. You must add back the NOL claimed on your federal income tax return.
- Using the wrong signs. Enter amounts on lines 2 through 5 as positive numbers when those lines apply. Enter qualifying Idaho property casualty losses on line 6 as a negative number.
- Treating Ponzi scheme losses as casualty losses. These are theft losses, and you must add them back when determining the Idaho NOL.
- Completing lines that do not apply. Corporations skip lines 3 through 5. Corporations, trusts, estates, and ABEs leave line 6 blank.
- Using line 7 for an absorption year. For a year in which you use the NOL to offset income, skip line 7 and use line 8.
Questions people ask
What is an Idaho net operating loss?
An Idaho NOL occurs when Idaho taxable income is less than zero after the required modifications. Idaho calculates this differently from the federal NOL.
What is the difference between a loss year and an absorption year?
A loss year is the year you incurred the loss. An absorption year is a year you use the NOL to offset income.
Can I use my own schedule instead of Form 56?
Yes. The instructions allow you to include Form 56 or your own schedule with the return for any year you calculate an Idaho NOL.
What is Form 56A used for?
Form 56A is used to compute the Idaho NOL carryback or carryover. Include it with the return if applicable.