November 12, 2019

Contact: Cassie Ann Hodges

Phone: 202-864-5923

WASHINGTON, DC – The National Venture Capital Association (NVCA) today sent a comment letter to the Department of the Treasury and the Internal Revenue Service (IRS) raising concerns about how a proposed rule change regarding the calculation of net operating loss (NOLs) limitations would harm startups and U.S. innovation.

The proposed rule change would reverse course on previously issued guidance that has worked well to smooth the tax implications of startups’ multi-year business cycles, and instead, impose rules that would hinder the ability of companies to match startup losses from R&D and similar activities with the future income generated by those activities, thereby depressing startup valuations and impeding new business formation and investment in innovation.

“At a time when the Department of the Treasury is focused on bolstering U.S. innovation, we are concerned that this proposed rule change will frustrate these efforts and unnecessarily reduce incentives to invest in entrepreneurship by reducing the valuations of innovative startups,” said Bobby Franklin, President and CEO of NVCA. “The proposed change to the calculation of NOLs will discourage the deployment of needed capital to promising startup businesses and critical U.S. technologies in the middle of a global innovation race.”

In addition to NVCA’s comments, NVCA also partnered with the Angel Capital Association (ACA), AdvaMed, and BIO on a separate letter arguing against the proposed NOL rule change.

Read NVCA’s Letter here.

Read the coalition letter here.


The National Venture Capital Association (NVCA) empowers the next generation of American companies that will fuel the economy of tomorrow. As the voice of the US venture capital and startup community, NVCA advocates for public policy that supports the American entrepreneurial ecosystem. Serving the venture community as the preeminent trade association, NVCA arms the venture community for success, serving as the leading resource for venture capital data, practical education, peer-led initiatives, and networking. For more information about NVCA, please visit