Instructions For Form 1120-Pc - 2009 (Page 12 of 21) in pdf

Limitation on deduction. The total

$5,000. Special rules apply to the

requirement applies even if the

amount claimed cannot be more than

contribution of certain property. See the

corporation does not claim a deduction for

10% of taxable income (line 37, Schedule

Instructions for Form 8283.

the current tax year. There are penalties

A) computed without regard to the

for failure to file these forms on time and

Qualified conservation contributions.

following.

for overstating the pension plan

Special rules apply to qualified

•

Any deduction for contributions.

deduction. See sections 6652(e) and

conservation contributions, including

•

The deduction for dividends received.

6662(f).

contributions of certain easements on

•

The domestic production activities

buildings located in a registered historic

Form 5500, Annual Return/Report of

deduction under section 199.

district. See Section 170(h) and Pub. 526,

Employee Benefit Plan. File this form for

•

Any net operating loss (NOL) carryback

Charitable Contributions.

a plan that is not a one-participant plan

to the tax year under section 172.

(see below).

•

Other special rules. The corporation

Any capital loss carryback to the tax

Form 5500-EZ, Annual Return of

must reduce its deduction for

year under section 1212(a)(1).

One-Participant (Owners and Their

contributions of certain capital gain

Carryover. Charitable contributions

Spouses) Retirement Plan. File this form

property. See sections 170(e)(1) and

over the 10% limitation cannot be

for a plan that only covers the owner (or

170(e)(5).

deducted for the tax year but may be

the owner and his or her spouse) but only

A larger deduction is allowed for

carried over to the next 5 tax years.

if the owner (or the owner and his or her

certain contributions of:

•

spouse) owns the entire business.

Special rules apply if the corporation

Inventory and other property to certain

has an NOL carryover to the tax year. In

Line 25. Employee benefit programs.

organizations for use in the care of the ill,

figuring the charitable contributions

Enter contributions to employee benefit

needy, or infants (see section 170(e)(3)),

deduction for the current tax year, the

programs not claimed elsewhere on the

including contributions of “apparently

10% limit is applied using taxable income

return (for example, insurance, health and

wholesome food” (see section

after taking into account any deduction for

welfare programs, etc.) that are not an

170(e)(3)(C)), and contributions of

the NOL.

incidental part of a pension, profit-sharing,

qualified book inventory to public schools

etc., plan included on line 24.

(see section 170(e)(3)(D));

To figure the amount of any remaining

•

Scientific equipment used for research

Line 27. Additional deduction. Enter

NOL carryover to later years, taxable

to institutions of higher learning or to

on line 27 the total from Form 8816, Part

income must be modified (see section

certain scientific research organizations

II, line 5.

172(b)). To the extent that contributions

(other than by personal holding

are used to reduce taxable income for this

Any insurance company taking the

companies and service organizations

purpose and increase an NOL carryover,

additional deduction must:

(section 170(e)(4)); and

•

a contributions carryover is not allowed.

Make special estimated tax payments

•

Computer technology and equipment

See section 170(d)(2)(B).

equal to the tax benefit from the

for educational purposes (section

deduction and

Cash contributions. For contributions

170(e)(6)).

•

Establish and maintain a Special Loss

of cash, check, or other monetary gifts

For more information on charitable

Discount Account. See section 847 and

(regardless of the amount), the

contributions, including substantiation and

Form 8816 for more information.

corporation must maintain a bank record,

recordkeeping requirements, see section

or a receipt, letter, or other written

Line 29. Dividends to policyholders.

170 and the related regulations and Pub.

communication from the donee

Enter the total dividends and similar

526. For other special rules that apply to

organization indicating the name of the

distributions paid or declared to

corporations, see Pub. 542.

organization, the date of the contribution,

policyholders, as policyholders, except in

and the amount of the contribution.

Line 22. Depreciation. Include on line

the case of a mutual fire insurance

22 depreciation and the cost of certain

company exclusively issuing perpetual

Contributions of $250 or more.

property that the corporation elected to

policies. Whether dividends have been

Generally, no deduction is allowed for any

expense under section 179. See Form

paid or declared should be determined

contribution of $250 or more unless the

4562 and the Instructions for Form 4562.

according to the method of accounting

corporation gets a written

employed by the insurance company.

acknowledgment from the donee

Line 23. Depletion. See sections 613

organization that shows the amount of

and 613A for percentage depletion rates

Dividends and similar distributions

cash contributed, describes any property

applicable to natural deposits. Also, see

include amounts returned or credited to

contributed, and, either gives a

section 291 for the limitation on the

policyholders on cancellation or expiration

description and a good faith estimate of

depletion deduction for iron ore and coal

of policies issued by a mutual fire or flood

the value of any goods or services

(including lignite).

insurance company:

provided in return for the contribution or

1. Where the premium deposits for

Attach Form T (Timber), Forest

states that no goods or services were

the policy are the same (regardless of the

Activities Schedule, if a deduction for

provided in return for the contribution. The

length of the policy) and

depletion of timber is taken.

acknowledgment must be obtained by the

2. The unabsorbed portion of the

Foreign intangible drilling costs and

due date (including extensions) of the

premium deposits not required for losses,

foreign exploration and development

corporation’s return, or, if earlier, the date

expenses, or establishment of reserves is

costs must either be added to the

the return is filed. Do not attach the

returned or credited to the policyholder on

corporation’s basis for cost depletion

acknowledgment to the tax return, but

cancellation or expiration of the policy.

purposes or be deducted ratably over a

keep it with the corporation’s records.

10-year period. See sections 263(i), 616,

In the case of a qualified group

Contributions of property other than

and 617.

self-insurers fund, the fund’s deduction for

cash. If a corporation contributes

See Pub. 535 for more information on

policyholder dividends is allowed no

property other than cash and claims over

depletion.

earlier than the date the state regulatory

a $500 deduction for the property, it must,

authority determines the amount of the

generally, attach a schedule to the return

Line 24. Pension, profit-sharing, etc.,

policyholder dividend that may be paid.

describing the kind of property contributed

plans. Enter the deduction for

See section 6076 of the Technical and

and the method used to determine its fair

contributions to qualified pension,

Miscellaneous Revenue Act of 1988.

market value (FMV). Generally, attach

profit-sharing, or other funded deferred

Form 8283, Noncash Charitable

compensation plans. Employers who

Line 30. Mutual interinsurers or

Contributions, to the return for

maintain such a plan generally must file

reciprocal underwriters — increase in

contributions of property (other than

one of the forms listed below, even if the

subscriber accounts. A mutual

money) if the total claimed deduction for

plan is not a qualified plan under the

insurance company that is an interinsurer

all property contributed was more than

Internal Revenue Code. The filing

or reciprocal underwriter may deduct the

-12-

Instructions for Form 1120-PC (2009)

Instructions For Form 1120-Pc - 2009 Page 12

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