Loss group
(c) Loss group(1) Defined. A loss group is a consolidated group that (i) Is entitled to use a net operating loss carryover to the taxable year that did not arise (and is not treated under 1.1502-21(c) as arising) in a SRLY; (ii) Has a consolidated net operating loss for the taxable year in which a testing date of the common parent occurs (determined by treating the common parent as a loss corporation); or (iii) Has a net unrealized built-in loss (determined under paragraph (g) of this section by treating the date on which the determination is made as though it were a change date). (2) Coordination with rule that ends separate tracking. A consolidated group may be a loss group because a member's losses that arose in (or are treated as arising in) a SRLY are treated as described in paragraph (c)(1)(i) of this section. See 1.1502-96(a). (3) Example. The following example illustrates the principles of this paragraph (c):