Net Operating Losses (NOL) for Businesses

A net operating loss occurs when a taxpayer has allowable deductions that exceed taxable income for a given tax year. This negative taxable income may be applied or carried over to reduce tax liability in other years.

Note: The Minnesota Tax Bill signed into law on April 8, 2024, retroactively changed the effective date to reduce the Corporate Net Operating Loss deduction limitation. If you filed your 2023 Corporate Franchise Tax Return before this law change, you may need to file an amended return to claim the additional NOL deduction.

• For tax years beginning after December 31, 2017, and before January 1, 2024, the NOL deduction is limited to 80% of the corporation's taxable income.
• For tax years beginning after December 31, 2023, the NOL deduction is limited to 70% of the corporation's taxable income.

For more information, see Minnesota Statute 290.095  and Schedule NOL.