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In the case of a Net Operating Loss (NOL) situation for a corporation filing Form 1120, line 37 is where you would enter the NOL deduction.

Here's how it works: If your corporation has a net operating loss (NOL) for the year, you can use this loss to offset income in other years. You first carry back the loss to the two preceding years, applying it against taxable income, which can result in a tax refund for those years. If any part of the NOL remains, you can carry it forward for up to 20 years to offset future taxable income.

So, on line 37 of Form 1120, you would enter the amount of the NOL that you're using to offset the current year's income. If the NOL is greater than your taxable income for the current year (before considering the NOL deduction), you would enter the amount of your taxable income on line 37. This effectively reduces your taxable income for the current year to zero. The remaining NOL can be carried forward to future years.

Remember, the rules for NOLs can be complex, and there are certain modifications and limitations, so it's important to calculate the NOL and its carryover correctly.