I 
116TH CONGRESS 
2D SESSION 
H. R. 6579 
To amend the Internal Revenue Code of 1986 to allow certain taxpayers 
a 2-year carryback of net operating losses and to restore and make 
permanent the limitation on excess business losses of non-corporate tax-
payers. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 21, 2020 
Mr. DOGGETT (for himself, Mr. RASKIN, Ms. DELAURO, Mr. COHEN, Mr. 
BEYER, Mr. BLUMENAUER, Mr. KHANNA, Mr. POCAN, Ms. SCHAKOWSKY, 
Mr. WELCH, Ms. WILD, Mr. DEFAZIO, Ms. JAYAPAL, and Ms. OMAR) in-
troduced the following bill; which was referred to the Committee on Ways 
and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to allow cer-
tain taxpayers a 2-year carryback of net operating losses 
and to restore and make permanent the limitation on 
excess business losses of non-corporate taxpayers. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
SECTION 1. LIMITATION ON EXCESS BUSINESS LOSSES OF 
NON-CORPORATE 
TAXPAYERS 
RESTORED 
AND MADE PERMANENT. 
(a) IN GENERAL.—Section 461(l)(1) of the Internal 
Revenue Code of 1986 is amended to read as follows: 
‘‘(1) LIMITATION.—In the case of taxable year 
of a taxpayer other than a corporation beginning 
after December 31, 2017— 
‘‘(A) subsection (j) (relating to limitation 
on excess farm losses of certain taxpayers) shall 
not apply, and 
‘‘(B) any excess business loss of the tax-
payer for the taxable year shall not be al-
lowed.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect as if included in section 
2304(a) of the Coronavirus Aid, Relief, and Economic Se-
curity Act. 
SEC. 
2. 
CERTAIN 
TAXPAYERS 
ALLOWED 
2-YEAR 
CARRYBACK OF NET OPERATING LOSSES 
ARISING IN 2020. 
(a) TWO-YEAR CARRYBACK OF LOSSES ARISING IN 
2020.— 
(1) IN GENERAL.—Section 172(b)(1)(D)(i) of 
the Internal Revenue Code of 1986 is amended— 
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
(A) by striking ‘‘beginning after December 
31, 2017’’ and inserting ‘‘beginning after De-
cember 31, 2019’’, and 
(B) by striking ‘‘5 taxable years’’ in sub-
clause (I) and inserting ‘‘2 taxable years’’. 
(2) CONFORMING AMENDMENTS.— 
(A) The heading for section 172(b)(1)(D) 
of such Code is amended by striking ‘‘2018, 
2019, AND’’. 
(B) Section 172(b)(1)(D) of such Code is 
amended by striking clause (iii) and by redesig-
nating clauses (iv) and (v) as clauses (iii) and 
(iv), respectively. 
(C) Section 172(b)(1)(D)(iv) of such Code, 
as so redesignated, is amended— 
(i) by striking subclause (II), and 
(ii) by striking ‘‘SPECIAL RULES’’ and 
all that follows through ‘‘If the 5-year 
carryback period’’ and inserting the fol-
lowing: ‘‘SPECIAL
RULE
FOR
ELECTION 
UNDER PARAGRAPH (3) TO EXCLUDE SEC-
TION 965 YEARS.—If the 2-year carryback 
period’’. 
(b) CARRYBACK ONLY ALLOWED FOR SMALL BUSI-
NESSES.— 
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
(1) IN GENERAL.—Section 172(b)(1)(D)(i) of 
such Code is amended by striking ‘‘net operating 
loss arising’’ and inserting ‘‘net operating loss of an 
eligible small business arising’’. 
(2) 
ELIGIBLE
SMALL
BUSINESS.—Section 
172(b)(1)(D) of such Code, as amended by the pre-
ceding provisions of this Act, is amended by adding 
at the end the following new clause: 
‘‘(v) ELIGIBLE
SMALL
BUSINESS.— 
For purposes of clause (i), the term ‘eligi-
ble small business’ means a corporation or 
partnership which meets the gross receipts 
test of section 448(c) (applied by sub-
stituting ‘$15,000,000’ for ‘$25,000,000’ 
each place it appears) for the taxable year 
in which the loss arose (or, in the case of 
a sole proprietorship, which would meet 
such test if such proprietorship were a cor-
poration).’’. 
(c) DISALLOWED FOR CERTAIN TAXPAYERS.—Sec-
tion 172(b)(1)(D) of such Code, as amended by the pre-
ceding provisions of this Act, is amended by adding at the 
end the following new clauses: 
‘‘(vi) CARRYBACK
DISALLOWED
FOR 
CERTAIN TAXPAYERS.—Clause (i) shall not 
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
issued’ means, with respect to any 
corporation, the aggregate value of 
stock issued by the corporation during 
all taxable years ending after Decem-
ber 31, 2017, in exchange for money 
or property other than stock in such 
corporation. 
‘‘(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. 
‘‘(viii) RELATED PERSON.—For pur-
poses of clause (vi), a person is a related 
person to a taxpayer if the related person 
bears a relationship to the taxpayer speci-
fied 
in 
section 
267(b) 
or 
section 
707(b)(1).’’. 
(d) ADVANCE CARRYBACK OF ESTIMATED NET OP-
ERATING LOSSES ARISING IN 2020.— 
(1) IN GENERAL.—In the case of a taxable year 
beginning after December 31, 2019, and before Jan-
uary 1, 2021, a taxpayer may file an application 
with the Secretary of the Treasury for an advance 
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
carryback adjustment of the tax for a prior taxable 
year that would be affected, by reason of the amend-
ments made by this section, by so much of any net 
operating loss estimated by the taxpayer to arise in 
the taxable year to which the application relates as 
does not exceed $100,000. 
(2) APPLICATION.—The application shall set 
forth in such detail and with such supporting data 
and explanation as the Secretary may require an es-
timate of the taxpayer’s net operating loss that will 
arise in such taxable year. 
(3) DUE DATE FOR APPLICATION.—An applica-
tion under this subsection may not be filed later 
than the due date for filing the return for the tax-
able year of the net operating loss from which the 
carryback results. 
(4) ALLOWANCE OF ADJUSTMENTS.—Not later 
than 30 days after the date on which an application 
for an advance carryback adjustment is filed under 
paragraph (1), the Secretary shall dispose of such 
application under rules similar to the rules of section 
6411 of the Internal Revenue Code of 1986. 
(5) REDUCTION OF NET OPERATING LOSS FOR 
APPLICATION YEAR.—The amount of any net oper-
ating loss (determined without regard to this para-
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
graph) of the taxpayer for any taxable year from 
which an advance carryback adjustment is made 
under this subsection shall be reduced (but not 
below zero) by the amount of estimated net oper-
ating loss taken into account in determining an ad-
vance carryback adjustment of the taxpayer under 
this subsection. 
(6) RECAPTURE.—The taxpayer’s tax imposed 
by chapter 1 for such taxable year shall be increased 
by the excess (if any) of— 
(A) the reduction in tax for all prior tax-
able years by reason of an advance carryback 
adjustment under this subsection, over 
(B) the reduction in tax for all prior tax-
able years by reason of a net operating loss fi-
nally arising in the taxable year to which the 
application under this section relates. 
(7) REFERENCES
TO
SECRETARY.—Any ref-
erence to the Secretary of the Treasury in this sub-
section shall be treated as including a reference to 
the Secretary’s delegate. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in the enact-
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS
ment of section 2302(b) of the Coronavirus Aid, Relief, 
and Economic Security Act. 
Æ 
VerDate Sep 11 2014 
18:41 Apr 24, 2020
Jkt 099200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6301
E:\BILLS\H6579.IH
H6579
pamtmann on DSKBC07HB2PROD with BILLS