Re: 2009 Worker Act: Five Year Net Operating Loss Carryback

Dear Client:

The expanded net operating loss carryback period for small businesses as provided by the American Recovery
and Reinvestment Act of 2009 (2009 Recovery Act), has been modified by the Worker, Homeownership, and
Business Assistance Act of 2009 (2009 Worker Act). The 2009 Worker Act now allows businesses of all sizes
to carryback net operating losses (NOL) to more than two and less than six years. In addition, the provision has
been extended to NOLs for 2008 or 2009.

In general, NOLs can be carried back two years and forward 20 years. The carryback and carryover periods
are determined by the law applicable to the year in which the NOL arises, rather than any of the years to which
it is carried back or forward. An NOL that is not utilized within its statutory timeframe expires without providing
any tax benefit.

Under the 2009 Worker Act, the election to carryback an NOL from two years to any number of years greater
than two and less than six (i.e. three, four, or five years) is expanded for businesses of all sizes with an NOL for
a tax year ending after December 31, 2007, and beginning before January 1, 2010. However, the amount of the
NOL which may be carried back to the fifth year preceding the tax year of the loss cannot exceed 50 percent of
the taxpayer's taxable income for the carryback year.

Although the provision extends to 2008 and 2009, the election for the expanded NOL carryback period can only
be made with respect to one loss year, unless the election is made by an eligible small business. Eligible small
businesses may make an election for two loss years.

Fortunately, taxpayers who have filed their returns and have made an election before enactment of the 2009
Worker Act are allowed time to revoke a prior election and timely file a new election.

Because you sustained an NOL, these provisions may present an opportunity for an immediate refund of prior
year taxes paid. Please call us at your earliest convenience to discuss your eligibility and determine the benefit of
an NOL carryback.

Sincerely yours,