This bill introduces a temporary cap of $1 million on the use of net operating loss deductions for taxpayers, excluding public utilities, under the corporation business tax for privilege periods ending on or after July 31, 2026, but before July 31, 2030. For taxpayers with shorter privilege periods, this limit will be prorated based on the number of months covered. Additionally, for privilege periods ending on or after July 31, 2030, taxpayers who have unused net operating loss deductions due to the imposed limitations will be allowed to carry over these deductions for up to six additional privilege periods, with the stipulation that the deduction cannot reduce the taxpayer's allocated entire net income by more than 75 percent.

Furthermore, the bill states that no interest or penalties will be assessed for underpayment of estimated tax installments due between December 31, 2025, and January 1, 2027, if the underpayment is a result of the limitations set forth in the bill. The provisions of this act will take effect immediately and apply to any privilege period ending on or after July 31, 2026.