`  == Contradict ==  I believe the following two paragraphs contradict each other.  I'm not sure which one is right.. —  :Additionally, many shell companies carry forward what is known as a tax-loss. This means that a loss incurred in previous years can be applied to income in future years. This shelters future income from income taxes. Since most active public companies become dormant public companies after a string of losses, or at least one large one, it is more likely that a shell company will offer this tax shelter.  :It is highly unusual to preserve any benefit from the tax loss carry forward in a shell company. The tsx regs. normally reduce the loss carry forward by the percentage of the change in control. In a well structured reverse merger the private company should end up with 95% or more of the stock after the mergr, thus reducing the tax loss carry forward by this amount for greater.  == Normally, U.S. tax law dramatically reduces the available of a loss carryforward if a change in control has occurred.  I believe that when a ``ownership change``(as defined in IRC Section 382(g)) is deemed to have occurred, Section 382 of the Internal Revenue Code reduces the availability of a loss carryforward to an amount equal to the product of the value of the old loss corporation and the applicable federal long-term tax-exempt rate.   :::That's not true.  You can apply tax losses to different items on the balance sheet.  Tax loss carry-forward is one of the great benefits of a RTO.  :::: In this case, the contradiction remains, because the article is saying that it is highly unusual to preserve the tax benefit. Can anyone clarify this point?    `