Overview
On June 9, 2022, Law360 quoted Eric Solomon in a piece titled "Keeping NOL Safe Harbor Could Aid Troubled Startups." The piece discusses the importance of allowing businesses to use their net operating losses after an ownership change under section 382. In 2019 the IRS issued proposed regulations that would eliminate a 2003 taxpayer-favorable rule enhancing the ability to use net operating losses as a result of income after an ownership change arising from "wasting assets."
Solomon explains that "[The 338 approach is] very beneficial to help troubled companies rehabilitate themselves, the use of those NOLs against future profits…Yes, it results in a lower tax bill, but a lower tax bill helps companies that have had losses before. When they turn the corner, it provides more support for them."
The full article can be read at Law360 Tax Authority.