Section 382 Limits on NOL Usage Following an Ownership Change

Navigating Restrictions on Loss Carryforwards to Maximize Tax Benefits

Recording of a 110-minute CPE/CLE webinar with Q&A

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Conducted on Wednesday, September 21, 2011

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Course Materials

This teleconference will provide accounting advisors with a review of the impactful terms of Sect. 382 and associated guidance. The panel will explore its application to frequently seen situations by corporations of all sizes struggling with limits on usage of NOLs following a change in ownership.


Beyond pure tax consequences, Sect. 382 limits on using federal net operating losses after a change in ownership exert significant influence over corporate M&A financing in terms of NOL values. Sect. 382 generally restricts companies from fully utilizing NOLs that pre-date an ownership change.

Calculating limits on NOLs under the federal formula, and assessing the impact, can be complicated. The Treasury Department's assertion of authority in this area with post-TARP guidance adds another layer of complexity.

Protecting NOL carryforward rights after an ownership change can be vital for both established corporations and development-stage companies. Advisors must stay well-versed on the implications of Sect. 382, associated notices and letter rulings, and provisions on built-in gains and losses.

Listen as our panel of veteran federal tax advisors helps bring you up to date on Sect. 382 policy, both in the material terms of the Code section and guidance and in the associated NOL scenarios with which advisors and corporate taxpayers are confronted.



  1. Review of Sect. 382 and administrative guidance
    1. Material terms of section itself
    2. IRS Notice 2010-50 and owner shifts of loss corporations with more than one class of stock
    3. Notice 2009-38 on instruments acquired by Treasury under EESA and TARP
    4. Notice 2008-76 on acquisitions under Housing and Economic Recovery Act of 2008
    5. Notice 2008-100 on instruments acquired by Treasury under Emergency Economic Stabilization Act of 2008
    6. Notice 2008-83 on application of Sect. 382(h) to banks
    7. Notice 2003-65 on built-in gains and losses under Sect. 382(h)
    8. Various IRS letter rulings, e.g. 201106001 and 201039013.
  2. Commonly faced NOL situations for companies
    1. Equity rollforward and loss companies
    2. Value fluctuations
    3. NUBIGs and NUBILs
    4. Consolidated return issues for new and departing members
    5. Cash issuance exceptions
    6. Bankruptcy issues


The panel will address these and other challenges that often arise with Sect. 382:

  • Calculating recognized built-in gains (NUBIGs) and built-in losses (NUBILs).
  • Ownership testing given fluctuations in stock value.
  • Potential equity rollforward problems for the buyer of a loss company.

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.


Jeffrey Kelson
Jeffrey Kelson

Partner-In-Charge, Domestic Tax

He has 25 years of corporate tax experience, with particular expertise in NOL studies. His work also extends into tax...  |  Read More

Todd Reinstein
Todd Reinstein

Tax Partner
Pepper Hamilton

His primary specialty is federal corporate tax law consulting, in areas ranging from structuring of taxable and exempt...  |  Read More

Robert Liquerman
Robert Liquerman

He is attached to the Corporate Tax Group in the firm's Washington National Tax Practice, and specializes in...  |  Read More

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