Was I correct to say that?

[AccTaxMan]

A single taxpayer only has about $2,000 of working income (form W-2) in 2011. He has a rental property with about $15,000 rental income. But after he deducts all the expenses like mortgage interest, property tax, depreciation, etc, he has a huge rental loss. So his total income is negative.

I told him based on his situation, whether he files the tax return before the due date or not does not really matter. It is because there is no tax due anyway. He has left my office. But I am second guessing myself now. Was my advice to him definitely correct?

[appelman]

NOL election

It sounds like he may have a pretty good NOL. The election to forgo the carryback and only carry it forward must be made by the extended filing date. Otherwise, he has to carry it back 2 years first.

[AccTaxMan]

It sounds like he may have a pretty good NOL. The election to forgo the carryback and only carry it forward must be made by the extended filing date. Otherwise, he has to carry it back 2 years first.

You made an excellent point. I have never considered the NOL. Thank you.