{"ok":true,"canonical_url":"https://dealroom.so/glossary/carryover-losses","api_url":"https://dealroom.so/api/public/glossary/carryover-losses","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"carryover-losses","term":"Carryover losses","group":"Reading the business","definition":"These are business operating losses from prior years that can be used to offset future taxable income, reducing the business's tax burden.","what_it_means":"While they can be a tax benefit, large carryover losses can signal past financial struggles. Understand their origin during due diligence. In an asset purchase, carryover losses typically stay with the seller, but in a stock purchase, they might transfer, which can be a tax advantage.","url":"https://dealroom.so/glossary/carryover-losses","official_sources":[],"related":[{"slug":"fiscal-years","term":"Fiscal years","url":"https://dealroom.so/glossary/fiscal-years"},{"slug":"tax-return","term":"Tax return","url":"https://dealroom.so/glossary/tax-return"},{"slug":"due-diligence","term":"Due diligence","url":"https://dealroom.so/glossary/due-diligence"}],"related_questions":[{"question":"What if my personal tax returns show inconsistent income or losses from other ventures?","url":"https://dealroom.so/sba-7a/questions/what-if-my-personal-tax-returns-show-inconsistent-income-or-losses-from-other-ventures"},{"question":"Can the SBA 7(a) loan include funds to cover initial operating losses post-acquisition?","url":"https://dealroom.so/sba-7a/questions/can-the-sba-7-a-loan-include-funds-to-cover-initial-operating-losses-post-acquisition"},{"question":"Can an SBA 7(a) loan include funds for a cash reserve to cover initial operating losses?","url":"https://dealroom.so/sba-7a/questions/can-an-sba-7-a-loan-include-funds-for-a-cash-reserve-to-cover-initial-operating-losses"},{"question":"What if an applicant has a prior business failure that resulted in personal losses but not bankruptcy?","url":"https://dealroom.so/for-lenders/questions/what-if-an-applicant-has-a-prior-business-failure-that-resulted-in-personal-losses-but-not"},{"question":"What if the acquired business has a history of losses but strong projected growth under new ownership?","url":"https://dealroom.so/sba-7a/questions/what-if-the-acquired-business-has-a-history-of-losses-but-strong-projected-growth-under-ne"},{"question":"If my previous business failed, resulting in personal losses, will this kill my SBA 7(a) loan chances?","url":"https://dealroom.so/for-lenders/questions/if-my-previous-business-failed-resulting-in-personal-losses-will-this-kill-my-sba-7-a-loan"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Carryover losses","url":"https://dealroom.so/glossary/carryover-losses","source_type":"DealRoom Data"}}