Beazer Homes USA has become the latest builder with worries that stock transactions among its largest shareholders has endangered its chances of snagging tax refunds for net operating losses.

The builder delayed releasing its Sept. 30 year-end financial results until Dec. 2, in order to give accountants time to review the company's stock transactions to determine if its ownership changed under a complicated and difficult-to-interpret-and-apply IRS provision. If the ownership has changed, the company could lose some or all of its anticipated tax refunds related to claiming current losses against past years' gains.

As defined under IRS Code section 382, a company's ownership has changed if 50% of the owners of 5% or more of its stock have changed over a period of time.

"We have got to get it right, and it's going to take us a little longer," said Leslie Kratcoski, Beazer's vice president of investor relations and corporate communications. "It's a very complicated calculation."

How much is at stake for the company? "We just don't know," she said.

Standard Pacific is another company that is expecting to lose an anticipated tax refund due to a change of ownership. Its provision was triggered when MatlinPatterson provided the company with a much-needed cash infusion. That case, which is being reviewed by the IRS, was much more clear-cut since it only involved one transaction.

The worry of other home builders is that they could have a change of ownership under tax law and not even be aware of it or have any control over it. That's why Hovnanian Enterprises, in an attempt to protect its net operating loss benefits, put in place a shareholder rights plan in August that would dilute its stock if an individual or entity buys more than 4.9% of its stock.

At the time, Hovnanian's CFO Larry Sorsby called the change in ownership provision "Draconian" and said Hovnanian began to research the issue while it was considering issuing equity.

And it's an issue likely to come up for any builder considering issuing equity to recapitalize its balance sheet.

In August, Steve Freidman, national director of home building services for Ernst & Young, said practical application of section 382 is difficult. "It has lots of nuances that are very complicated," he said.

In addition to dealing with the question of whether its ownership has changed in IRS's eyes, Beazer's preliminary results show the Atlanta-based builder has some significant other challenges.

Closings for the quarter ended Sept. 20 were down 38.2% over the same quarter last year. New-home orders were up 10.3% year-over-year to 1,083, but Beazer's buyers continued to cancel at a higher rate than that experienced by other builders, spiking over to 45.7%. However that's a big improvement from last year's 68.1% cancellation rate when false rumors of bankruptcy were circulating.

Beazer's cash balance was improved to $584.3 million compared to $314.2 million at the end of its third quarter and $453.2 million at the end of September in '07.