Instructions For Form 1120-Pc - 2001 (Page 9 of 20) in pdf

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owe a tax. See Form 8611, Recapture of

must be made on or before the due date

The annualized income or adjusted

Low-Income Housing Credit.

(without regard to extensions) of this tax

seasonal installment method is used or

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return. See Form 8816 and section 847(2)

The corporation is a large corporation

Other. Additional taxes and interest

for additional information.

computing its first required installment

amounts may be included in the total

based on the prior year’s tax. See the

entered on line 12. Check the box for

Tax Benefit Rule. Section 847(8)

Instructions for Form 2220 for the

“Other” if the corporation includes any of

requires that if a corporation carries back

definition of a large corporation.

the taxes and interest discussed below.

net operating losses or capital losses that

If you attach Form 2220, be sure to

See How to report below, for details on

arise in years after a year in which a

check the box on line 15, and enter the

reporting these amounts on an attached

section 847 deduction was claimed, then

amount of any penalty on that line.

schedule.

the corporation must recompute the tax

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Recapture of qualified electric vehicle

benefit attributable to the previously

Line 18. Direct deposit of tax refund of

(QEV) credit. The corporation must

claimed section 847 deduction taking into

$1 million or more. If the corporation

recapture part of the QEV credit claimed

account the loss carrybacks. Tax benefits

wants its refund of $1 million or more

in a prior year, if, within 3 years of the

also include those derived from filing a

directly deposited into its checking or

date the vehicle was placed in service, it

consolidated return with another

savings account at any U.S. bank or other

ceases to qualify for the credit. See

insurance company (without regard to

financial institution instead of having a

Regulations section 1.30-1 for details on

section 1503(c)).

check sent to the corporation, complete

how to figure the recapture.

Form 8302 and attach it to the

Therefore, if the recomputation

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Recapture of Indian employment credit.

corporation’s tax return.

changes the amount of the section 847

Generally, if an employer terminates the

tax benefit, then the taxpayer must

employment of a qualified employee less

provide a computation schedule and

than 1 year after the date of initial

Schedule A—Taxable

attach it to Form 8816.

employment, any Indian employment

Income

Line 14h. Credit by reciprocal for tax

credit allowed for a prior tax year because

paid by attorney-in-fact under section

of wages paid or incurred to that

Gross income. Under section 832, gross

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

employee must be recaptured. For

amounts of underwriting and investment

an attorney-in-fact as a result of income

details, see Form 8845 and section 45A.

income should be computed on the basis

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received by the attorney-in-fact from the

Interest on deferred tax attributable to

of the underwriting and investment exhibit

reciprocal during the tax year. For more

certain nondealer installment obligations

of the NAIC annual statement to the

information, see section 835, the related

(section 453A(c)).

extent not inconsistent with the Internal

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regulations, and the instructions for line 5

Interest due on deferred gain (section

Revenue Code and its Regulations.

on page 7.

1260(b)).

Gross income, however, does not include

Line 14i. Other credits and payments.

How to report. If the corporation

extraterritorial income that is qualifying

Enter the amount of any other credits the

checked the “Other” box, attach a

foreign trade income. Use Form 8873,

corporation may take and/or payments

schedule showing the computation of

Extraterritorial Income Exclusion, to figure

made. Write to the left of the entry space,

each item included in the total for line 12,

the exclusion. Report it as explained in

an explanation of the entry.

and identify the applicable Code section

the Instructions for Form 8873.

and the type of tax or interest.

Backup withholding. If the corporation

Note. In computing the amounts for lines

had income tax withheld from any

Line 13. Total Tax

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

payments it received because, for

rents received during the year, add

Include any deferred tax on the

example, it failed to give the payer its

interest, dividends, or rents due and

termination of a section 1294 election

correct EIN, include the amount withheld

accrued at the end of the tax year, and

applicable to shareholders in a qualified

in the total for line 14i. This type of

deduct interest, dividends, or rents due

electing fund in the amount entered on

withholding is called “Backup

and accrued at the end of the preceding

line 13. See Form 8621, Part V and How

Withholding.” Show the amount withheld

tax year. For rules regarding the accrual

to report below.

in the blank space in the right hand

of dividends, see Regulations section

Subtract any deferred tax on the

column between lines 13 and 14j, and

1.301-1(b).

corporation’s share of undistributed

write “Backup Withholding.”

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

earnings of a qualified electing fund (see

Line 14j. Total payments. Add the

Enter the gross amount of interest

Form 8621, Part II).

amounts on lines 14f through 14i and

income, including all tax-exempt interest.

How to report. Attach a schedule

enter the total on line 14j.

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

showing the computation of each item

Line 15. Estimated tax penalty. A

excludes interest on state or local bonds

included in, or subtracted from, the total

corporation that does not make estimated

from gross income.

for line 13. On the dotted line next to line

tax payments when due may be subject

13, specify (a) the applicable Code

This exclusion does not apply to any:

to an underpayment penalty for the period

section, (b) the type of tax, and (c) enter

of underpayment. Generally, a

1. Private activity bond which is not a

the amount of tax.

corporation is subject to the penalty if its

qualified bond as defined by section 141;

Line 14b. Prior year(s) special

tax liability is $500 or more and it did not

2. Arbitrage bond as defined by

estimated tax payments to be applied.

timely pay the smaller of:

section 148; or

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The amount entered on line 14b must

Its tax liability for 2001, or

3. Bonds not meeting the

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agree with the amount(s) from Form

Its prior year’s tax.

requirements of section 149 (regarding

8816, Part III, line 11. See Form 8816 and

See section 6655 for details and

the registration of tax-exempt bonds).

section 847(2) for additional information.

exceptions, including special rules for

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

large corporations.

Line 14c. Estimated tax payments.

Amortization of premium. Enter on line

Enter any estimated tax payments the

Use Form 2220, Underpayment of

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

corporation made for the tax year. Do not

Estimated Tax by Corporations, to see if

bond premium, including amortization on

include any amount being applied on line

the corporation owes a penalty and to

tax-exempt bonds. Enter on line 3b,

14d.

figure the amount of the penalty.

column (b), the amortization of bond

Line 14d. Special estimated tax

Generally, the corporation does not have

premium on tax-exempt bonds only.

payments. If the deduction under section

to file this form because the IRS can

847 is claimed on Schedule A, line 27,

figure the amount of any penalty and bill

Note. Insurance companies electing to

special estimated tax payments must be

the corporation for it. However, even if the

amortize discount for tax purposes must

made in an amount equal to the tax

corporation does not owe the penalty,

reduce the amortization of premium by

benefit of the deduction. These payments

complete and attach Form 2220 if:

any amortization of discount.

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Instructions For Form 1120-Pc - 2001 Page 9

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