Instructions For Form 1118 - (Rev. December 2009) (Page 10 of 13) in pdf

1.861-9T(g)(3), 1.861-12T(g)(2), and

columns (a)(i) and (a)(ii), respectively,

deductions). See Regulations sections

1.861-12T(h)(2) for the rules for

that attract specifically allocable interest

1.861-8 and 1.861-14 and Temporary

characterizing the assets.

deductions.

Regulations sections 1.861-8T and

1.861-14T.

Columns (b)(iii) and (b)(iv)

Lines 3a through 3d. To figure the

amount of interest deductions to

Line 1a. Enter the total interest

Line 1a. Enter the total other deductions.

apportion to each statutory grouping,

deductions for the members of the

Examples include: stewardship expenses;

divide the assets apportioned to the

corporation’s affiliated group. These

legal and accounting expenses; and other

grouping by the total assets apportioned

include any expense that is currently

expenses related to certain supportive

and multiply the result by the interest

deductible under section 163 (including

functions such as overhead, general and

deductions to be apportioned.

original issue discount), and interest

administrative, advertising, and

equivalents. See Temporary Regulations

marketing. Deductions for charitable

Example 1. To figure the amount to

section 1.861-9T for the definition of

contributions made on or after July 28,

enter on line 3a, column (b)(iii): (a) divide

interest equivalents and a list of the

2004, generally are definitely related and

the amount entered on line 3a, column

sections that disallow or suspend interest

allocable to all gross income and

(a)(i), by the amount on line 2, column

deductions or require the capitalization of

apportioned solely to domestic source

(a)(i); and (b) multiply the result by the

interest deductions.

income.

amount on line 2, column (b)(iii).

Line 1b. Enter the interest deductions

associated with the assets on line 1b of

Lines 3a through 3d. Enter the

Example 2. To figure the amount to

columns (a)(i) and (a)(ii), respectively,

enter on line 3b, column (b)(iv): (a) divide

amounts apportioned to each statutory

that attract specifically allocable interest

the amount on line 3b, column (a)(ii) by

grouping.

deductions under Temporary Regulations

the amount on line 2, column (a)(ii); and

section 1.861-10T(e).

(b) multiply the result by the amount on

Note. These interest deductions will be

line 2, column (b)(iv).

Schedules I, J, and K

divided among the statutory groupings

and will appear as a definitely allocable

Column (c)

See the separate instructions for

deduction in Schedule A, column 9(d).

Schedule I, Schedule J, and Schedule K

Complete this column to apportion all

to see if the corporation must file these

Line 1c. Enter the interest deductions

other deductions not definitely allocable

schedules.

associated with the assets on line 1c of

(other than interest deductions and R&D

Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United

States. You are required to give us the information. We need it to ensure that you are complying with these laws and to allow us to

figure and collect the right amount of tax.

You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the

form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their

contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are

confidential, as required by section 6103.

The time needed to complete and file this form and related schedules will vary depending on individual circumstances. The

estimated average times are:

Learning about the law

Preparing and sending

Form

Recordkeeping

or the form

the form to the IRS

1118

71 hr., 16 min.

17 hr., 44 min.

20 hr., 53 min.

Sch. I (Form 1118)

9 hr., 19 min.

1 hr.

1 hr., 11 min.

Sch. J (Form 1118)

22 hr., 43 min.

1 hr., 23 min.

1 hr., 49 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form and related

schedules simpler, we would be happy to hear from you. See the instructions for the tax return with which this form is filed.

-10-

Instructions For Form 1118 - (Rev. December 2009) Page 10

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