Limitation on excess business losses of noncorporate taxpayers

(a) Rule made permanent Section 461(l)(1) is amended by striking and before January 1, 2029, each place it appears. (b) Certain net operating loss carryover taken into account Section 461(l)(3) is amended— (1) by inserting (except as provided in subparagraph (B)) after section 172, (2) by redesignating subparagraphs (B) and (C) as subparagraphs (C) and (D), respectively, and (3) by inserting after subparagraph (A) the following new subparagraph: (B) Certain net operating loss carryover taken into account (i) In general For purposes of subparagraph (A)(i), the aggregate deductions of the taxpayer shall be increased by so much of the net operating loss carried to the taxable year as is attributable to the treatment of a specified loss as a net operating loss under paragraph (2). (ii) Specified loss For purposes of this subparagraph, the term specified loss means a loss which is disallowed under paragraph (1) for a taxable year beginning after December 31, 2024.. (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2025.