The net operating loss deduction has been getting a lot of attention after it was revealed that Donald Trump took a $916 million loss on his 1995 income-tax return.
If that's the case, America has a lot of tax geniuses.
"I see some people on both sides in politics portraying [net operating losses] as some kind of obscure genius tax strategy. In reality, it's an ordinary feature of the tax code that every tax professional knows about," said Alan Cole, an economist with the Center for Federal Tax Policy at the Tax Foundation.
To be sure, the size of Trump's write-off is huge. His net operating loss, known in tax circles as NOL, in 1995 was more than 9,000 times the average amount claimed that year.
"Put it this way: Trump's alleged loss of $916 million would be 1.9 percent of the entire NOL value of the entire country," Cole said.
More than 1.2 million taxpayers filed for an NOL deduction in 2014, the most recent tax year where statistics from the Internal Revenue Service are available. The average deduction was $163,292 (see chart below).