Effect of Net operating Losses

For firms which have huge net operating losses carried forward there is tremendous potential for savings in the first few years, till they generate positive earnings.
Till the time there is Non operating losses accumulated with the firm, the firm would not be paying any tax, as the profits start flowing in, first the NOL will be covered and after than any taxable income that remains would be taxed. The tax rate would be calculated on the taxrate*taxable income/Total Income. Therefore the tax rate can build up over a period of time to 35% in the end