CARES Windfall for the Wealthiest Repeal Act

To amend the Internal Revenue Code of 1986 to impose a limitation on excess business losses of non-corporate taxpayers and to modify the carryback of net operating losses for certain taxable years. 1. Short title This Act may be cited as the CARES Windfall for the Wealthiest Repeal Act 2. Limitation on excess business losses of non-corporate taxpayers restored and made permanent (a) In general Section 461(l)(1) (1) Limitation In the case of a taxpayer other than a corporation, any excess business loss of the taxpayer shall not be allowed. . (b) Farming losses Section 461 of such Code is amended by striking subsection (j). (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2017. 3. Certain taxpayers allowed carryback of net operating losses arising in 2019 2020 (a) Carryback of losses arising in 2019 2020 (1) In general Section 172(b)(1)(D)(i) (i) In general In the case of any net operating loss arising in a taxable year beginning after December 31, 2018, and before January 1, 2021, and to which subparagraphs (B) and (C)(i) do not apply, such loss shall be a net operating loss carryback to each taxable year preceding the taxable year of such loss, but not to any taxable year beginning before January 1, 2018. . (2) Conforming amendments (A) The heading for section 172(b)(1)(D) of such Code is amended by striking 2018, 2019, and 2019 and (B) Section 172(b)(1)(D) of such Code is amended by striking clause (iii) and by redesignating clauses (iv) and (v) as clauses (iii) and (iv), respectively. (C) Section 172(b)(1)(D)(iii) of such Code, as so redesignated, is amended by striking (i)(I) (i) (D) Section 172(b)(1)(D)(iv) of such Code, as so redesignated, is amended— (i) by striking If the 5-year carryback period under clause (i)(I) If the carryback period under clause (i) (ii) by striking 2018 or (b) Disallowed for certain taxpayers Section 172(b)(1)(D) of such Code, as amended by the preceding provisions of this Act, is amended by adding at the end the following new clauses: (v) Carryback disallowed for certain taxpayers Clause (i) shall not apply with respect to any loss arising in a taxable year in which— (I) the taxpayer (or any related person) is not allowed a deduction under this chapter for the taxable year by reason of section 162(m) or section 280G, or (II) the taxpayer (or any related person) is a specified corporation for the taxable year. (vi) Specified corporation For purposes of clause (v)— (I) In general The term specified corporation (II) Applicable stock issued The term applicable stock issued (III) Certain preferred stock disregarded For purposes of subclause (I), stock described in section 1504(a)(4), and distributions (including redemptions) with respect to such stock, shall be disregarded. (vii) Related person For purposes of clause (v), a person is a related person to a taxpayer if the related person bears a relationship to the taxpayer specified in section 267(b) or section 707(b)(1). . (c) Effective date The amendments made by this section shall take effect as if included in the enactment of section 2303(b) of the Coronavirus Aid, Relief, and Economic Security Act.

Summary: CARES Windfall for the Wealthiest Repeal Act This bill restores and makes permanent the limitation on excess businesses losses of noncorporate taxpayers. It also allows taxpayers a carryback of their net operating losses arising in 2019 and 2020.