NOL and State tax deduction

[Gretel]

I need some help if I am thinking straight. I am familiar with the NOL but not in all details when it comes to adjustments to itemized deductions. Here are sample figures to keep it simple:

NOL carryforward 200,000
NOL used this year 20,000
itemized deductions 25,000
state taxes incl for this year 1,000 as was for prior year

I think I either need to show the prior year state tax refund as income or I need to adjust the NOL carryforward by this amount, otherwise client would double dip at the end.

Since software automatically puts tax refund as zero, I need to adjust NOL carryforward, right?

[Gretel]

I also meant to say that the state tax deduction equals the amount of refund received.

[Gretel]

Here I go again in my lone search (have a big smile on my face).

The only thing that really makes sense is to report the refund as fully taxable, which will offset part of the NOL. So this is what I will do.

[Jesse]

I can only bump you............

I'm so tired and brain dead and I'm sooooooooooo looking forward to tomorrow coming and going!

[S T]

Wish I could help also

But like Jesse I am also brain dead and on automatic pilot, for payment vouchers being emailed and faxed, and then the no balance/refund extensions on Wednesday.

Sandy

[Gretel]

Thank you Jesse and Sandy for your kind posts despite everything else. I don't really expect anyone to jump in just hoped someone would know of top of her/his head. But what can grow on top of a dead brain anyway.

Take good care of yourselves.