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penalty will not be imposed if the

wholesale purchasing of fertilizers, cattle

If the cooperative has changed its

cooperative can show that the failure to

breeding, etc.).

address since it last filed a return, check

pay on time was due to reasonable

the box for “Address change.”

Item B—Employer

cause.

Note. If a change in address occurs after

Trust fund recovery penalty. This

the return is filed, use Form 8822,

Identification Number (EIN)

penalty may apply if certain excise,

Change of Address, to notify the IRS of

Enter the cooperative’s EIN. If the

income, social security, and Medicare

the new address.

cooperative does not have an EIN, it must

taxes that must be collected or withheld

apply for one on Form SS-4, Application

Income

are not collected or withheld, or these

for Employer Identification Number. If the

taxes are not paid to the IRS. These

Except as otherwise provided in the

cooperative has not received its EIN by

taxes are generally reported on Forms

Internal Revenue Code, gross income

the time the return is due, write “Applied

720, 941, 943, or 945 (see Other Forms,

includes all income from whatever source

for” in the space for the EIN. See Pub.

Returns, Schedules and Statements

derived. Gross income, however, does

583 for details.

That May Be Required on page 2). The

not include extraterritorial income that is

trust fund recovery penalty may be

qualifying foreign trade income. Use

Item C—Consolidated

imposed on all persons who are

Form 8873, Extraterritorial Income

determined by the IRS to have been

Return

Exclusion, to figure the exclusion. Include

responsible for collecting, accounting for,

the exclusion in the total for “Other

Cooperatives filing a consolidated return

and paying over these taxes, and who

Deductions” on line 26.

must attach Form 851 and other

acted willfully in not doing so. The penalty

supporting statements to the return. For

Line 1. Gross receipts or sales. Enter

is equal to the unpaid trust fund tax. See

details, see “Other Forms, Returns,

gross receipts or sales from all business

the instructions for Form 720, Pub. 15

Schedules and Statements That May Be

operations except items of income

(Circular E), Employer’s Tax Guide, or

Required,” on page 2. Do not check this

required to be reported on lines 4a

Pub. 51 (Circular A), Agricultural

box if the “Section 521” box is checked in

through 10. In general, advance

Employer’s Tax Guide, for details,

Item D.

payments are reported in the year of

including the definition of responsible

receipt. For how to report income from

persons.

Item D—Type of

long-term contracts, see section 460. For

Other penalties. Other penalties can be

special rules for reporting certain advance

Cooperative

imposed for negligence, substantial

payments for goods and long-term

understatement of tax, and fraud. See

Check the “Tax exempt” (section 521) box

contracts, see Regulations section

sections 6662 and 6663.

if the cooperative is a tax-exempt

1.451-5. For permissible methods for

farmers’, fruit growers’, or like

reporting certain advance payments for

association, organized and operated on a

services by an accrual method

Specific Instructions

cooperative basis and is described in

cooperative, see Rev. Proc. 71-21,

section 521.

1971-2 C.B. 549.

Period Covered

Installment sales. Generally, the

If the cooperative has submitted Form

installment method cannot be used for

1028, Application for Recognition of

File the 2002 return for calendar year

dealers dispositions of property. A “dealer

Exemption, but has not received a

2002 and fiscal years that begin in 2002

disposition” is: (a) any disposition of

determination letter from the IRS, check

and end in 2003. For a fiscal year return,

personal property by a person who

the “Tax exempt” (section 521) box, and

fill in the tax year space at the top of the

regularly sells or otherwise disposes of

write “Application Pending” at the top of

form.

personal property of the same type on the

page 1 of Form 990-C.

Note. The 2002 Form 990-C may also be

installment plan or (b) any disposition of

All other farmers’, etc., cooperatives

used if:

real property held for sale to customers in

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organized and operated as described

The cooperative has a tax year of less

the ordinary course of the taxpayer’s

under “Who Must File” on page 2 of the

than 12 months that begins and ends in

trade or business.

instructions should check the

2003 and

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These restrictions on using the

“Nonexempt” box.

The 2003 Form 990-C is not available

installment method do not apply to

at the time the cooperative is required to

Cooperatives organized and operated

dispositions of property used or produced

file its return.

for purposes other than those described

in a farming business or sales of

in section 521 should not file Form

The cooperative must show its 2003

timeshares and residential lots for which

990-C. See the instructions for Form

tax year on the 2002 Form 990-C and

the cooperative elects to pay interest

1120, U.S. Corporation Income Tax

take into account any tax law changes

under section 453(I)(3).

Return, for information about filing

that are effective for tax years beginning

For sales of timeshares and residential

requirements.

after December 31, 2002.

lots reported under the installment

method, the cooperative’s income tax is

Item E—Initial Return,

Address

increased by the interest payable under

Final Return, Name

Include the suite, room, or other unit

section 453(l)(3). To report this addition to

number after the street address. If a

tax, see the instructions for line 9,

Change, Address Change,

preaddressed label is used, include this

Schedule J.

information on the label.

or Amended Return

Enter on line 1 (and carry to line 3), the

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If the Post Office does not deliver mail

If this is the cooperative’s first return,

gross profit on collections from installment

to the street address and the cooperative

check the “Initial return” box.

sales for any of the following:

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has a P.O. box, show the box number.

If the cooperative ceases to exist, file

Dealer dispositions of property before

Form 990-C and check the “Final return”

March 1, 1986.

Item A—Business Activity

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box.

Dispositions of property used or

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With the Largest Total

If the cooperative changed its name

produced in the trade or business of

since it last filed a return, check the box

farming.

Receipts

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for “Name change.” Generally, a

Certain dispositions of timeshares and

Identify the business activity from which

cooperative also must have amended its

residential lots reported under the

the cooperative receives the largest total

articles of incorporation and filed the

installment method.

receipts (e.g., wholesale marketing of

amendment with the state in which it was

Attach a schedule showing the

meat, drying fruit, grain storage,

incorporated.

following information for the current and

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Instructions For Form 990-C - Farmers' Cooperative Association Income Tax Return - Internal Revenue Service - 2002 Page 6

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