Instructions For Form 1120-Sf - 2006
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1
2
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4Instructions for
Department of the Treasury
Internal Revenue Service
Form 1120-SF
(Rev. February 2006)
(Use with the November 2003 revision of Form 1120-SF)
U.S. Income Tax Return for Settlement Funds
Section references are to the Internal Revenue Code unless otherwise noted.
“Paid Preparer’s Use Only” section of the
When To File
How To Get Forms and
fund’s return. It does not apply to the firm, if
Generally, a fund must file its income tax return
any, shown in that section.
Publications
by the 15th day of the 3rd month after the end
If the “Yes” box is checked, the fund is
Internet. You can access the IRS website 24
of its tax year.
authorizing the IRS to call the paid preparer to
hours a day, 7 days a week, at to:
If the due date falls on a Saturday, Sunday,
answer any questions that may arise during the
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Order IRS products online;
or legal holiday, the fund may file on the next
processing of its return. The fund is also
•
Download forms, instructions, and
business day.
authorizing the paid preparer to:
•
publications;
Give the IRS any information that is missing
Private delivery services. Funds can use
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Research your tax questions online;
from the return,
certain private delivery services designated by
•
•
Search publications online by topic or
Call the IRS for information about the
the IRS to meet the “timely mailing as timely
keyword; and
processing of the return or the status of any
filing/paying” rule for tax returns and payments.
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related refund or payment(s), and
Sign up to receive local and national tax
These private delivery services include only the
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Respond to certain IRS notices that the fund
news by email.
following.
•
has shared with the preparer about math
DHL Express (DHL): DHL Same Day
CD-ROM. You can order Publication 1796,
errors, offsets, and return preparation. The
Service, DHL Next Day 10:30 am, DHL Next
IRS Tax Products CD-ROM, and obtain:
notices will not be sent to the preparer.
Day 12:00 pm, DHL Next Day 3:00 pm, and
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A CD that is released twice so you have the
DHL 2nd Day Service.
The fund is not authorizing the paid
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latest products. The first release ships in late
Federal Express (FedEx): FedEx Priority
preparer to receive any refund check, bind the
December and the final release ships in late
Overnight, FedEx Standard Overnight, FedEx
fund to anything (including any additional tax
February;
2Day, FedEx International Priority, and FedEx
liability), or otherwise represent the fund before
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Current year forms, instructions, and
International First.
the IRS.
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publications;
United Parcel Service (UPS): UPS Next Day
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The authorization will automatically end no
Prior year forms, instructions, and
Air, UPS Next Day Air Saver, UPS 2nd Day
later than the due date (excluding extensions)
publications;
Air, UPS 2nd Day Air A.M., UPS Worldwide
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for filing the funds’s tax return for the following
Tax Map: an electronic research tool and
Express Plus, and UPS Worldwide Express.
year. If the fund wants to expand the paid
finding aid;
The private delivery service can tell you
preparer’s authorization or revoke the
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Tax law frequently asked questions (FAQs);
how to get written proof of the mailing date.
authorization before it ends, see Publication
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Tax Topics from the IRS telephone response
947, Practice Before the IRS and Power of
Private delivery services cannot deliver
system;
!
Attorney.
•
items to P.O. boxes. You must use the
Fill-in print and save features for most tax
U.S. Postal Service to mail any items to
CAUTION
forms;
Assembling the Return
an IRS P.O. box address.
•
Internal Revenue Bulletins; and
Attach schedules in alphabetical order and
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Extension of time to file. File Form 7004,
Toll-free and email technical support.
other forms in numerical order after Form
Application for Automatic 6-Month Extension of
1120-SF.
Time To File Certain Business Income Tax,
Buy the CD-ROM from the National
Information, and other Returns, to request a
Technical Information Service (NTIS) at
Complete every applicable entry space on
6-month extension of time to file. Generally, file
/cdorders for $25 (no handling fee)
Form 1120-SF. Do not write “See Attached”
Form 7004 by the regular due date of the
or call 1-877-CDFORMS (1-877-233-6767) toll
instead of completing the entry spaces. If more
return.
free to buy the CD-ROM for $25 (plus a $5
space is needed on the forms or schedules,
handling fee).
attach separate sheets using the same size
Who Must Sign
and format as the printed forms. If there are
By phone and in person. You can order
supporting statements and attachments,
The return must be signed and dated by the
forms and publications by calling
arrange them in the same order as the
administrator of the fund.
1-800-TAX-FORM (1-800-829-3676). You can
schedules or forms they support and attach
If an employee of the fund completes Form
also get most forms and publications at your
them last. Show the totals on the printed forms.
1120-SF, the paid preparer’s space should
local IRS office.
Enter the fund’s name and employer
remain blank. Anyone who prepares Form
identification number (EIN) on each supporting
1120-SF but does not charge the fund should
statement or attachment.
not complete that section. Generally, anyone
General Instructions
who is paid to prepare the return must sign it
Depository Method of Tax
and fill in the “Paid Preparer’s Use Only” area.
Payment
The paid preparer must complete the
Purpose of Form
required preparer information and:
The fund must pay any tax due in full no later
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Use Form 1120-SF, U.S. Income Tax Return
Sign the return in the space provided for the
than the 15th day of the 3rd month after the
for Settlement Funds, to report transfers
preparer’s signature.
end of the tax year. The two methods of
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received, income earned, deductions claimed,
Give a copy of the return to the
depositing taxes are discussed below.
distributions made, and to figure the income
administrator.
tax liability of a designated or qualified
Electronic Deposit Requirement
Paid Preparer Authorization
settlement fund.
The fund must make electronic deposits of all
If the fund wants to allow the IRS to discuss its
depository taxes (such as employment tax,
Who Must File
tax return with the paid preparer who signed it,
excise tax, and fund income tax) after
All section 468B designated and qualified
check the “Yes” box in the signature area of
December 31 of the calendar year following
settlement funds must file an annual income
the return. This authorization applies only to
any calendar year in which the fund deposited
tax return on Form 1120-SF.
the individual whose signature appears in the
more than $200,000 of such taxes. Once the
Cat. No. 14988X
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