Tax Court allows split NOL election for Apache’s specified liability losses

Apache Corp. v. Commissioner, No. 25984-22, 165 T.C. No. 11 (U.S. Tax Court, Nov. 13, 2025).

The Tax Court holds that a consolidated group can waive the standard 2-year net operating loss (NOL) carryback under §172(b)(3) while still keeping the 10-year carryback for the portion of the NOL that is a specified liability loss (SLL) under §172(b)(1)(C) and §172(f).

This lets Apache carry SLLs back 10 years while carrying the rest of its 2016 and 20…