Instructions For Form 1120-Pc - 2008 (Page 8 of 20) in pdf

Line 14d. Special estimated tax

the instructions for these forms, and Rev.

3. Bonds not meeting the

payments. If the deduction under

Proc. 2008-65, 2008-44 I.R.B. 1082, and

requirements of section 149 (regarding

section 847 is claimed on Schedule A,

Rev. Proc. 2009-16, 2009-6 I.R.B. 449.

the registration of tax-exempt bonds).

line 27, special estimated tax payments

Line 14k. Total payments. Add the

Lines 3a and 3b, column (b).

must be made in an amount equal to the

amounts on lines 14f through 14j and

Amortization of premium. Enter on

tax benefit of the deduction. These

enter the total on line 14k.

line 3a, column (b), the total amortization

payments must be made on or before the

of bond premium, including amortization

Line 15. Estimated tax penalty. If Form

due date (without regard to extensions) of

on tax-exempt bonds. Enter on line 3b,

2220 is attached, check the box on line

this tax return. See Form 8816 and

column (b), the amortization of bond

15 and enter the amount of any penalty

section 847(2) for additional information.

premium on tax-exempt bonds only.

on this line.

Tax benefit rule. Section 847(8)

Note. Insurance companies electing to

Line 18. Electronic deposit of tax

requires that if a corporation carries back

amortize discount for tax purposes must

refund of $1 million or more. If the

net operating losses or capital losses that

reduce the amortization of premium by

corporation is due a refund of $1 million

arise in years after a year in which a

any amortization of discount.

or more and wants it electronically

section 847 deduction was claimed, then

deposited into its checking or savings

the corporation must recompute the tax

Line 4. Gross rents. Enter gross rents,

account at any U.S. bank or other

benefit attributable to the previously

computed as indicated under the

financial institution instead of having a

claimed section 847 deduction taking into

instructions for Gross income, above.

check sent to the corporation, complete

account the loss carrybacks. Tax benefits

Deduct expenses, such as repairs,

Form 8302 and attach it to the

also include those derived from filing a

interest, taxes, and depreciation, on the

corporation’s tax return.

consolidated return with another

proper lines for deductions.

insurance company (without regard to

Line 6. Capital gain net income. Every

section 1503(c)).

sale or exchange of a capital asset must

Schedule A—Taxable

be reported in detail on Schedule D (Form

Therefore, if the recomputation

1120), Capital Gains and Losses, even if

changes the amount of the section 847

Income

there is no gain or loss.

tax benefit, then the taxpayer must

Gross income. Under section 832,

provide a computation schedule and

Generally, losses from sales or

gross amounts of underwriting and

attach it to Form 8816.

exchanges of capital assets are only

investment income should be computed

allowed to the extent of gains. However,

Line 14e. Overpaid estimated tax. If

on the basis of the Statement of Income

corporations taxed under section 831 may

the corporation overpaid estimated tax, it

of the NAIC annual statement to the

claim losses from capital assets sold or

may be able to get a quick refund by filing

extent not inconsistent with the Internal

exchanged to get funds to meet abnormal

Form 4466. The overpayment must be at

Revenue Code and its Regulations.

insurance losses and to pay dividends

least 10% of the corporation’s expected

and similar distributions to policyholders.

Income from qualifying shipping

income tax liability and at least $500. File

Do not include those types of losses here,

activities. Gross income does not

Form 4466 after the end of the

but instead, report them on Schedule G.

include income from qualifying shipping

corporation’s tax year, and no later than

activities if the corporation makes an

the 15th day of the third month after the

The net capital loss for these

election under section 1354 to be taxed

end of the tax year. Form 4466 must be

corporations is the amount by which

on its notional shipping income (as

filed before the corporation files its tax

losses for the year from sales or

defined in section 1353) at the highest

return.

exchanges of capital assets exceed the

corporate tax rate (35%). If the election is

gains from these sales or exchanges plus

Line 14h. Credit by reciprocal for tax

made, the corporation generally may not

the smaller of:

paid by attorney-in-fact under section

claim any loss, deduction, or credit with

835(d). Enter the amount of tax paid by

1. Taxable income (computed without

respect to qualifying shipping activities. A

an attorney-in-fact as a result of income

gains or losses from sales or exchanges

corporation making this election also may

received by the attorney-in-fact from the

of capital assets); or

elect to defer gain on the disposition of a

reciprocal during the tax year. For more

2. Losses from the sale or exchange

qualifying vessel.

information, see section 835, the related

of capital assets sold or exchanged to

regulations, and the instructions for line 5

Use Form 8902, Alternative Tax on

obtain funds to meet abnormal insurance

losses and to provide for the payment of

on page 6.

Qualifying Shipping Activities, to figure

dividends and similar distributions to

the tax. Include the alternative tax on line

Line 14i. Other credits and payments.

policyholders.

12, page 1 of the Form 1120-PC.

Enter the amount of any other credits the

corporation may take and/or payments

Note. In computing the amounts for lines

Subject to the limitations in section

made. Write an explanation of the entry to

2, 3, and 4, take all interest, dividends, or

1212(a), a net capital loss can be carried

the left of the entry space.

rents received during the year, add

back 3 years and forward 5 years as a

interest, dividends, or rents due and

Backup withholding. If the corporation

short-term capital loss.

accrued at the end of the tax year, and

had federal income tax withheld from any

Line 8. Certain mutual fire or flood

deduct interest, dividends, or rents due

payments it received because, for

insurance company premiums. A

and accrued at the end of the preceding

example, it failed to give the payer its

mutual fire or flood insurance company

tax year. For rules regarding the accrual

correct EIN, include the amount withheld

whose principal business is the issuance

of dividends, see Regulations section

in the total for line 14i. Write the amount

of policies (1) for which the premium

1.301-1(b).

withheld and the words “Backup

deposits are the same (regardless of the

Withholding” on the dotted line to the left

Line 3a, column (a). Gross interest.

length of the term the policies are written

of the entry space for line 14i.

Enter the gross amount of interest

for) and (2) under which the unabsorbed

income, including all tax-exempt interest.

Line 14j. Refundable Credits from

portion of such premium deposits not

Forms 3800 and 8827. The corporation

required for losses, expenses, or

Line 3b, column (a). Section 103(a)

can elect to claim certain unused

establishment of reserves is returned or

excludes interest on state or local bonds

research and minimum tax credits instead

credited to the policyholder on

from gross income.

of claiming any additional first-year

cancellation or expiration of the policy,

This exclusion does not apply to any:

special depreciation allowance for eligible

must include in income an amount equal

qualified property. If the corporation

1. Private activity bond which is not a

to 2% of the premiums earned on

makes the election, enter on line 14j the

qualified bond as defined by section 141;

insurance contracts during the tax year

amounts from line 19c of Form 3800 and

2. Arbitrage bond as defined by

with respect to such policies after

line 8c of Form 8827, if applicable. See

section 148; or

deduction of premium deposits returned

-8-

Instructions for Form 1120-PC

Instructions For Form 1120-Pc - 2008 Page 8

Related Articles

Related forms

Related Categories