noun \ ˈlȯs \
Updated on: 13 Oct 2017

Definition of loss

1 :destruction, ruin
  • to save the world from utter loss
  • —John Milton
2 a :the act of losing possession :deprivation
  • loss of sight
b :the harm or privation resulting from loss or separation
  • bore up bravely under the loss of both parents
c :an instance of losing
  • His death was a loss to all who knew him.
3 :a person or thing or an amount that is lost: such as
a losses plural :killed, wounded, or captured soldiers
  • His regiment suffered terrible losses.
b :the power diminution of a circuit (see 1circuit 4a) or circuit element corresponding to conversion of electrical energy into heat by resistance (see 1resistance 4a)
4 a :failure to gain, win, obtain, or utilize
  • loss of a game
b :an amount by which the cost of something exceeds its selling price
  • The railroad claimed to be operating at a loss.
5 :decrease in amount, magnitude, or degree
  • a loss in altitude
6 :the amount of an insured's financial detriment by death or damage that the insurer is liable for
at a loss
1 :uncertain as to how to proceed
  • was at a loss to explain the discrepancy
2 :unable to produce what is needed
  • at a loss for words
for a loss
:into a state of distress
  • events had thrown him for a loss

Examples of loss in a Sentence

  1. The storm caused widespread loss of electricity.

  2. The company's losses for the year were higher than expected.

  3. A careless error resulted in the loss of the game.

  4. The team suffered a 3–2 loss in the last game.

  5. The team has an equal number of wins and losses.

  6. the party's losses in the recent election

Recent Examples of loss from the Web

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'loss.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Origin and Etymology of loss

Middle English los, probably back-formation from lost, past participle of losen to lose

Financial Definition of LOSS

capital loss

What It Is

A capital loss is a decrease in the value of an investment. It is the difference between the sale price and the purchase price (the basis) of an asset.

How It Works

The formula for capital loss is:

Purchase Price - Sale Price = Capital Loss

Note that this formula assumes the purchase price is higher than the sale price. If an investor sells an asset for more than he or she paid, this is called a capital gain.

Let's assume you purchase 100 shares of XYZ Company for $5 per share. After three months, the share price decreases to $1. This means the value of the investment has decreased from $500 to $100, for a capital loss of $400.

Why It Matters

Capital losses are generally tax deductible, but only when they are realized. That is, they only become deductible when the asset is actually sold (unless the stock is legally deemed worthless). Until that point, any losses are considered unrealized and are not deductible. The IRS considers nearly every asset owned by individuals and companies as capital assets and thus subject to capital gains taxes and capital loss deductions.

Taxpayers report capital losses on IRS Schedule D. An investor's capital losses will sometimes offset all or a portion of his or her capital gains, lowering the investor's tax bill. There is a limit to how much the investor can offset (generally $3,000), but remaining losses can typically be carried over to future tax years. To prevent trading for the sole purpose of tax avoidance, the wash sale rule prevents investors from deducting capital losses on a security if they purchased a "substantially identical security" within thirty days before or after the sale.

Many analysts claim that the deductibility of capital losses encourages tax-loss selling during November and December of each year, which in turn fuels the "January effect," which is a tendency for the market to rise during that month. Analysts believe this is the case because the wash sale rule requires investors who sell stock for tax-losses in November and December to wait at least thirty days to repurchase those shares.

net operating loss

What It Is

A net operating loss (NOL) is a negative profit for tax purposes. It usually occurs when a company's tax deductions exceed its taxable, making the company unprofitable.

How It Works

Net operating losses can be used to reduce future tax payments. For example, let's assume Company XYZ has taxable income of $1,000,000 and tax deductions of $1,300,000. Its net operating loss is $1,000,000 - $1,300,000 = - $300,000.

Company XYZ will probably not have to pay taxes that year (because it didn't have any taxable income). But let's assume that next year, Company XYZ makes a lot more money and records $500,000 of taxable income.

If Company XYZ is taxed at a corporate tax rate of 40%, it would need to pay $500,000 x 40% = $200,000 in taxes. But because it incurred an NOL last year, it can apply that NOL to this year's tax bill, reducing it significantly (or even to $0, depending on the jurisdiction Company XYZ is in). Company XYZ could also carry the NOL "back" and apply it against taxable income in preceding years.

Why It Matters

NOLs are important because they create future tax relief for companies. The general idea is that when a firm makes money, it pays taxes; when it doesn't make money, it can get some relief. As a result, NOLs in and of themselves are valuable assets. In fact, sometimes companies purchase other companies solely for their NOLs.

The laws on applying NOLs vary by state, but usually an NOL from the last two or three years can be applied up to 20 years in the future, at which point it will expire. There are rules and exceptions for almost any circumstance, so it's best to check with the IRS or a qualified tax accountant when calculating and applying NOLs.

LOSS Defined for English Language Learners



Definition of loss for English Language Learners

  • : failure to keep or to continue to have something

  • : the experience of having something taken from you or destroyed

  • : money that is spent and that is more than the amount earned or received

LOSS Defined for Kids


noun \ ˈlȯs \

Definition of loss for Students

1 :the act or fact of losing something
  • a loss of courage
2 :harm or distress that comes from losing something or someone
  • We all felt the loss when he left.
3 :something that is lost
  • weight loss
4 :failure to win
  • It was the team's first loss.
at a loss
:unsure of how to proceed

Law Dictionary



legal Definition of loss

1 :physical, emotional, or especially economic harm or damage sustained: as
a :decrease in value, capital, or amount — compare gain
b :an amount by which the cost of something (as goods or services) exceeds the selling price — compare profit
c :something unintentionally destroyed or placed beyond recovery
d :the amount of an insured's financial detriment due to the occurrence of a stipulated event (as death, injury, destruction, or damage) in such a manner as to create liability in the insurer under the terms of the policy
Note: As a general rule, economic losses are deductible from adjusted gross income under section 165 of the Internal Revenue Code. There are, however, numerous exceptions and limitations.
actual loss
:the identifiable and calculable monetary detriment that is suffered or will be suffered as a result of an act or event
actual total loss
:a loss in marine insurance in which the property (as a vessel or cargo) cannot be repaired or recovered — compare constructive total loss in this entry
capital loss
:the amount by which the book value of a capital asset exceeds the amount realized from the sale or exchange of the asset
casualty loss
:loss of property as a result of a fire, storm, shipwreck, or other catastrophic event
consequential loss
:a loss that arises as an indirect result of an act or event called also indirect loss; compare direct loss in this entry
constructive total loss
:a loss in marine insurance in which the cost of repairing or recovering a ship or its cargo would be more than the ship or cargo is worth — compare actual total loss in this entry
direct loss
:a loss arising directly from an act or event — compare consequential loss in this entry
indirect loss
:consequential loss in this entry
net operating loss
:the amount by which the expenses of operating a business exceed the income derived from it — see also carryback, carryover
ordinary loss
:a loss from the sale or exchange of any asset that is not a capital asset
partial loss
:a loss arising from damage to property that does not render it a total loss
total loss
:a loss arising from damage to property that is so substantial as to make the property valueless to an insured
2 :the act or fact of suffering physical, emotional, or especially economic harm or detriment

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