Instructions For Form 990-C - Farmers' Cooperative Association Income Tax Return - Internal Revenue Service - 2005 Page 12

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no later than the 15th day of the third
have to file this form because the IRS
Line 30. Taxable Income
month after the end of the tax year.
can figure the amount of any penalty
Certain cooperatives may need to file
Form 4466 must be filed before the
and bill the cooperative for it. However,
Form 8817. If so, taxable income
cooperative files its tax return.
even if the cooperative does not owe
reported on line 30 may not exceed the
the penalty, complete and attach Form
combined taxable income shown on
Line 32f. Credit from
2220 if:
line 30, Form 8817. Attach Form 8817
Refiguring Tax
The annualized income or adjusted
to Form 990-C.
seasonal installment method is used, or
If the cooperative would pay less total
The cooperative is a large
Patronage source losses cannot
tax by claiming the deduction for the
!
corporation computing its first required
be used to offset nonpatronage
redemption of nonqualified written
installment based on the prior year’s
income. See Form 8817.
CAUTION
notices of allocation or nonqualified
tax. (See the Instructions for Form 2220
per-unit retain certificates in the issue
Minimum taxable income. The
for the definition of a large corporation.)
year versus the current tax year,
cooperative’s taxable income cannot be
If Form 2220 is attached, check the
refigure the tax for the years the
less than the largest of the following
box on line 33, and enter the amount of
nonqualified written notices or
amounts.
any penalty on this line.
certificates were originally issued
The amount of nondeductible CFC
(deducting them in the issue year), then
dividends under section 965. This
Line 36. Direct Deposit of
enter the amount of the reduction in the
amount is equal to the difference
Refund
issue years’ taxes on this line. Attach a
between columns (a) and (c) of Form
schedule showing how the credit was
If the cooperative has a refund of $1
990-C, Schedule C, line 11.
figured. This credit is treated as a
million or more and wants it directly
The inversion gain of the cooperative
payment, and any amount that is more
deposited into its checking or savings
for the tax year, if the cooperative is an
than the tax on line 31 will be refunded.
account at any U.S. bank or other
expatriated entity or a partner in an
financial institution instead of having a
expatriated entity. For details, see
Line 32g. Credits
check sent to the cooperative, complete
section 7874.
Form 8302 and attach it to the
Credit for federal tax on fuels. Enter
Net operating loss. If line 30 (figured
cooperative’s tax return.
any credit from Form 4136, Credit for
without regard to the minimum taxable
Federal Tax Paid on Fuels. Attach
income rule stated above) is zero or
Form 4136 to Form 990-C.
less, the cooperative can have an NOL
Schedule A
that can be carried back or forward as a
Credit for tax on ozone-depleting
deduction to other tax years. Generally,
chemicals. Include on line 32g any
Cost of Goods Sold
a cooperative first carries an NOL back
credit the cooperative is claiming under
2 tax years. However, the cooperative
section 4682(g)(2) for tax on
Generally, inventories are required at
can elect to waive the carryback period
ozone-depleting chemicals. Enter
the beginning and end of each tax year
and instead carry the NOL forward to
“ODC” next to the entry space.
if the production, purchase, or sale of
future tax years. To make the election,
merchandise is an income-producing
Line 32h. Total Payments
see the instructions for Schedule N,
factor. See Regulations section
item 19.
Add the amounts on lines 32d through
1.471-1.
32g and enter the total on line 32h.
See Form 1139 for details, including
However, if the cooperative is a
other elections that may be available,
qualifying taxpayer, or a qualifying
Backup withholding. If the
which must be made no later than 6
small business taxpayer (defined
cooperative had federal income tax
months after the due date (excluding
below), it can adopt or change its
withheld from any payments it received,
extensions) of the cooperative’s return.
accounting method to account for
because, for example, it failed to give
inventoriable items in the same manner
the payer its correct EIN, include the
Line 32b. Estimated Tax
as materials and supplies that are not
amount withheld in the total for line
Payments
incidental (unless its business is a tax
32h. Enter the amount withheld and the
shelter as defined in section 448(d)(3)).
words “Backup withholding” in the blank
Enter any estimated tax payments the
space above line 32h.
cooperative made for the tax year.
A “qualifying taxpayer” is a taxpayer
that, for each prior tax year ending after
Beneficiaries of trusts. If the
Line 33. Estimated Tax
December 16, 1998, has average
cooperative is the beneficiary of a trust,
Penalty
annual gross receipts of $1 million or
and the trust makes a section 643(g)
less for the 3-tax-year period ending
election to credit its estimated tax
A cooperative that does not make
with that prior tax year.
estimated tax payments when due may
payments to its beneficiaries, include
be subject to an underpayment penalty
the cooperative’s share of the payment
A “qualifying small business
in the total for line 32b. Enter “T” and
for the period of underpayment.
taxpayer” is a taxpayer (a) that, for
the amount of the payment in the blank
Generally, a cooperative is subject to
each prior tax year ending on or after
the penalty if its tax liability is $500 or
space below line 31.
December 31, 2000, has average
more and it did not timely pay the
annual gross receipts of $10 million or
Line 32c. Overpaid Estimated
smaller of:
less for the 3-tax-year period ending
Tax
Its tax liability for 2005, or
with that prior tax year and (b) whose
Its prior year’s tax.
principal business activity is not an
If the cooperative overpaid estimated
See section 6655 for details and
ineligible activity.
tax, it may be able to get a quick refund
exceptions including special rules for
by filing Form 4466, Corporation
Under this accounting method,
large cooperatives.
Application for Quick Refund of
inventory costs for raw materials
Overpayment of Estimated Tax. The
Use Form 2220, Underpayment of
purchased for use in producing finished
overpayment must be at least 10% of
Estimated Tax by Corporations, to see
goods, and merchandise purchased for
the expected income tax liability and be
if the cooperative owes a penalty and to
resale, are deductible in the year the
at least $500. File Form 4466 after the
figure the amount of the penalty.
finished goods or merchandise are sold
end of the cooperative’s tax year, and
Generally, the cooperative does not
(but not before the year the cooperative
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