Replies to post #1935 on Green Energy Management (fka GRMS)

[bbcoachrjs]

Net Operating Loss Carryforward

I have read in posts that CWDW has a $44 million NOL that another company can use. However, by reading the 10Q this morning, it states that the $44 miilion NOL has already been used and that there is only a NOL of $2.5 million available:

NOTE C - INCOME TAXES


The Sale was a taxable transaction to the Company for United States federal income tax purposes and accordingly the Company recognized a gain in its federal income tax return for the year ended December 31, 2006. Net operating loss carryforwards of approximately $44,000,000 were used to fully offset the gain reported in the federal income tax return filed for the year ended December 31, 2006. In addition, a tax liability of approximately $894,000 resulting from the application of the federal Alternative Minimum Tax (“AMT”) rules was computed and was fully paid during the first quarter of 2007.


Unexpired net operating loss carryforwards of approximately $2,500,000 at December 31, 2008 remain available to offset any future upward adjustments to the gain from the Asset Sales or adjustments to unaudited open tax years resulting from Internal Revenue Service audit adjustments. The Company does not believe that there will be any additional material amount of taxes payable as a result of the Sale and it believes that it has sufficient usable net operating loss carryforwards to offset substantially all of any income or gain recognized for “regular” federal income tax purposes resulting from a subsequent review and adjustment by the Internal Revenue Service. However, there can be no assurance that the Internal Revenue Service or relevant state tax authorities will ultimately assent to the Company’s tax treatment of the asset sale or the availability of net operating loss carryforwards to fully offset the gains from the transaction or subsequent income adjustments. To the extent the Internal Revenue Service or any relevant state tax authorities ultimately prevail in re-characterizing the tax treatment of the asset sale or the net operating loss carryforwards, there may be adverse tax consequences to the Company and its stockholders, including that the Company could owe income taxes on up to the entire purchase price and that its common stockholders would be required to return any distributions they have received.


Am I missing something?