NOL Impact On M&A

This question tests whether you understand how tax attributes flow through an M&A deal and how they can change the value created by the transaction. A candidate should be able to explain the two main ways target NOLs can matter, including how they may be used by the buyer to shelter future taxable income and how tax law can limit the annual benefit. It also checks awareness of the rules that apply when NOLs are used against taxable income in a sale context, since interviewers want to see that you can connect tax mechanics to deal valuation and accretion or dilution analysis.