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Publicly Traded

8810. Instead, use the following rules to

corporation has a distilled spirits credit from

figure and report income, gains, deductions,

each of two passive activities. Enter each

Partnerships (PTPs)

and losses from passive activities held

distilled spirits credit on separate lines in

through each PTP that the corporation

column (a) of Worksheet 5. A corporation

A PTP is a partnership whose interests are

owned an interest in during the tax year.

has a distilled spirits credit and a disabled

traded on an established securities market

access credit from the same passive

or are readily tradable on a secondary

1. Combine any current year income,

activity. Enter the distilled spirits credit and

market (or its substantial equivalent).

gains, deductions, and losses, and prior

the disabled access credit on separate lines

year unallowed losses to see if there is an

An established securities market includes

in column (a) of Worksheet 5.

overall gain or loss. Include only the same

any national securities exchange and any

types of income and losses that would be

Form 5884, Work Opportunity Credit.

local exchange registered under the

included in figuring net income or loss from

Enter the credits from line 5 of Form 5884 in

Securities Exchange Act of 1934 or

a non-PTP passive activity (see Passive

column (a) of Worksheet 5. If the credits are

exempted from registration because of the

Activity Income and Deductions on page 4).

from more than one activity, separate the

limited volume of transactions. It also

credits by activity before making entries in

includes any over-the-counter market.

2. If there is an overall gain, the net gain

the worksheet.

portion (total income in excess of total

A secondary market generally exists

deductions and losses) is nonpassive

where a person stands ready to make a

Form 6478, Alcohol and Cellulosic

income. Report the income, deductions, and

market in the interest. An interest is treated

Biofuel Fuels Credit. Enter the credits

losses on the forms and schedules normally

as readily tradable if the interest is regularly

from line 10 of Form 6478 in column (a) of

used.

quoted by persons, such as brokers or

Worksheet 5. If the credits are from more

dealers, who are making a market in the

than one activity, separate the credits by

3. If there is an overall loss (other than in a

interest.

activity before making entries in the

year in which the corporation disposed of its

worksheet.

The substantial equivalent of a

entire interest in the PTP), the deductions

secondary market exists where there is no

and losses are allowed to the extent of the

Form 8586, Low-Income Housing Credit.

identifiable market maker, but holders of

income, and the excess deductions and

Enter the credits from line 13 of Form 8586

interests have a readily available, regular,

losses are carried forward for use in a future

in column (a) of Worksheet 5. If the credits

and ongoing opportunity to sell or exchange

year when there is income to offset them.

are from more than one activity, separate

interests through a public means of

Report the income and the loss allowed to

the credits by activity before making entries

obtaining or providing information on offers

the extent of income on the form or

in the worksheet.

to buy, sell, or exchange interests. Similarly,

schedule normally used.

Form 8835, Renewable Electricity,

the substantial equivalent of a secondary

Refined Coal, and Indian Coal Production

Part II. 2010 Passive

market exists where prospective buyers and

Credit. Enter the credits from line 31 of

sellers have the opportunity to buy, sell, or

Activity Credits

Form 8835 in column (a) of Worksheet 5. If

exchange interests in a timeframe and with

the credits are from more than one activity,

the regularity and continuity that the

Use Part II of Form 8810 to figure the

separate the credits by activity before

existence of a market maker would provide.

amount of credits allowed from passive

making entries in the worksheet.

activities for the current year and the

Special Instructions for PTPs

Form 8844, Empowerment Zone and

amount that is unallowed and carried

Renewal Community Employment Credit.

Section 469(k) provides that the PAL

forward.

Enter the credits from line 5 of Form 8844 in

limitations must be applied separately to

items from each PTP.

Worksheet 5

column (a) of Worksheet 5. If the credits are

from more than one activity, separate the

Losses from passive activities the

Use Worksheet 5 below to figure the

credits by activity before making entries in

corporation holds through a PTP generally

amounts to enter on lines 5a and 5b of Form

the worksheet.

can be used only to offset income or gain

8810.

from passive activities of the same PTP.

Form 8846, Credit for Employer Social

Column (a). Convert any current year

Any unallowed loss from a PTP passive

Security and Medicare Taxes Paid on

qualified expenditures into credits before

activity is carried forward and allowed in a

Certain Employee Tips. Enter the credits

beginning Worksheet 5. Use the following

tax year when the corporation has passive

from line 7 of Form 8846 in column (a) of

forms.

income from the same PTP or when the

Worksheet 5. If the credits are from more

corporation disposes of its entire interest in

than one activity, separate the credits by

Form 3468, Investment Credit. Enter the

that PTP.

activity before making entries in the

credits from line 15 of Form 3468 in column

worksheet.

(a) of Worksheet 5. Separate the credits by

Income from passive activities the

activity and by type before making entries in

corporation holds through a PTP cannot be

Form 8900, Qualified Railroad Track

the worksheet.

used to offset losses from passive activities

Maintenance Credit. Enter the credits

the corporation holds through another PTP

Form 3800, General Business Credit.

from line 8 of Form 8900 in column (a) of

or losses from any other passive activities.

Enter the credits from line 3 of Form 3800 in

Worksheet 5. If the credits are from more

PAL rules for partners in PTPs. Do not

column (a) of Worksheet 5. Separate the

than one activity, separate the credits by

include any income, gains, deductions, or

credits by activity and by type before making

activity before making entries in the

losses from PTP passive activities on Form

entries in the worksheet. For example, a

worksheet.

Worksheet 5—For Form 8810, Lines 5a and 5b

(b) Prior Year

(a) Current Year

Name of Activity

From Form

Unallowed Credits

(Add Columns (a)

Credits (Line 5a)

(Line 5b)

and (b))

Totals. Enter on lines 5a and 5b of Form 8810 . . . . . . . . . . . . . . . .

-10-

Instructions for Form 8810 (2010)

Instructions For Form 8810 - Corporate Passive Activity Loss And Credit Limitations - 2010 Page 10

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