Final answer:
A 2019 Net Operating Loss (NOL) cannot be deducted in determining a corporation's 2020 NOL. The Tax Cuts and Jobs Act of 2017 changed the rules, disallowing carrybacks but allowing NOLs to be carried forward indefinitely, subject to an 80% of taxable income limitation.
Step-by-step explanation:
In determining a corporation's Net Operating Loss (NOL) for 2020, a 2019 NOL may not be deducted. According to the Tax Cuts and Jobs Act of 2017, which was active for the 2019 tax year, NOLs from years beginning after December 31, 2017, are no longer permitted to be carried back to previous tax years, but can be carried forward indefinitely. However, the NOL carryforward can only offset up to 80% of taxable income in those future years.
For tax years beginning before January 1, 2018, NOLs could have been carried back up to two years and forward up to 20 years. Therefore, if looking at a 2019 NOL under the laws effective in 2020, the correct answer to the question is option c. The NOLs could not be applied retroactively to reduce taxable income in previously filed returns.