Looking for a Form 8810 Templates? Download it for free!

Form 8941, Credit for Small Employer

and closely held corporations with net

Computation for Line 7

Health Insurance Premiums. Enter the

passive income.

Part I. Tax Attributable to Net Passive

credits from line 17 of Form 8941 in column

Computation for Line 7, Part II. This part

Income

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

is used by closely held corporations that

more than one activity, separate the credits

have net active income. See the line 2

A. Income tax before credits from Form

by activity before making entries in the

instructions on page 8 for the definition of

1120 (Schedule J, line 2) . . . . . . . . . .

worksheet.

net active income. If the corporation has

B. Taxable income from Form 1120

both net passive income and net active

Column (b). In figuring this year’s passive

C. Net passive income. See

income, complete Part I and Part II and

activity credit, the corporation must take into

instructions for line C above . . .

D. Subtract line C from line B. If zero

enter the amount from line Q on line 7 of

account any credits from passive activities

or less, enter -0- here and on line

Form 8810.

disallowed for prior years and carried

E . . . . . . . . . . . . . . . . . . . .

forward to this year adjusted, if required, for

Note. When using taxable income in the

E. Tax attributable to line D. Figure the tax

items such as recaptured credits (see

computation for line 7, it is not necessary to

on the line D amount as if it were the

Regulations section 1.469-3(f)). Enter in

refigure items based on taxable income,

corporation’s only taxable income . . . . .

column (b) of Worksheet 5 the prior year

F. Tax attributable to net passive income.

such as the contributions deduction,

unallowed credits from column (c) of

Subtract line E from line A. Closely held

dividends-received deduction, and the net

Worksheet 6 in the 2009 Form 8810

corporations that do not have net active

operating loss deduction.

income and personal service corporations

instructions (adjusted if required).

Use the applicable tax rates in section 11

enter the amount here and on line 7 of

For rules about prior year unallowed

when figuring the tax attributable amounts.

Form 8810 . . . . . . . . . . . . . . . . . . .

credits from former passive activities, see

Also, see how to figure tax in the

Part II. Tax Attributable to Net Active

section 469(f).

instructions for the tax return filed.

Income

Line C. Enter the net income, if any, from

Line 7

line 1d of Form 8810. If the corporation has

G. Enter amount from line E if Part I is

If any of the following apply, enter -0- on line

completed. Otherwise, enter income tax

an overall loss from the entire disposition of

7 and do not complete Part I or Part II of the

before credits from Form 1120 (Schedule

a passive activity, the amount to enter on

Computation for Line 7 below.

J, line 2) . . . . . . . . . . . . . . . . . . . .

line C is the net income from line 1d

•

The corporation is a personal service

H. Taxable income from Form 1120

reduced by the overall loss, but not below

I. Net active income . . . . . . . . .

corporation with a loss or zero on line 1d of

zero. If the result is zero, skip the rest of the

J. Net passive income or loss. See

Form 8810.

Part I computation.

instructions for line J above . . .

•

The corporation is a personal service

K. Combine lines I and J. If less than

Line J. If the corporation has net passive

corporation with net passive income on line

zero, enter as a negative amount

income, enter the amount from line C on this

1d of Form 8810 and the corporation has an

L. Subtract line K from line H. If zero

line. If the corporation has a net loss from

overall loss from the entire disposition of a

or less, enter -0- here and on line

line 1d of Form 8810, enter that amount on

passive activity that is equal to or greater

M . . . . . . . . . . . . . . . . . . .

line J as a negative amount.

than the net income on line 1d.

M. Tax attributable to line L. Figure the tax

•

on the line L amount as if it were the

The corporation is a closely held

corporation’s only taxable income . . . . .

corporation with a loss or zero on line 1d of

N. Subtract line M from line G. If zero or

Form 8810 and that amount is equal to or

less, enter -0- here and on line P . . . . .

greater than the net active income on line 2

O. Enter the corporation’s nonpassive

of Form 8810.

credits without regard to the tax liability

•

The corporation is a closely held

limitations . . . . . . . . . . . . . . . . . . .

corporation with net income on line 3 of

P. Tax attributable to net active income.

Form 8810, and the corporation has an

Subtract line O from line N . . . . . . . . .

Q. Tax attributable to net passive income

overall loss from an entire disposition that is

and net active income. Add lines F and

equal to or greater than the net income on

P. Enter the result here and on line 7 of

line 3.

Form 8810 . . . . . . . . . . . . . . . . . . .

Computation for Line 7, Part I. This part

is used by personal service corporations

Worksheet 6

Use Worksheet 6 to allocate the allowed and unallowed credits for each activity.

Column (a). Enter the total credits from column (c) of Worksheet 5.

Column (b). Divide each of the credits in column (a) by the total of all credits in column (a). The total of the ratios should equal 1.00.

Column (c). Multiply line 8 of Form 8810 by the ratios in column (b) and enter the results in column (c). These are the unallowed

credits for 2010. Keep a record of these amounts, so the credits can be carried to the next year.

Column (d). Subtract column (c) from column (a). These are the allowed credits for 2010. The amounts in this column should be

reported on the forms normally used. See Reporting Allowed Credits on Tax Return on page 12.

Worksheet 6 — Allowed and Unallowed Credits

Form To Be

Name of Activity

(a) Credits

(b) Ratio

(d) Allowed Credits

Reported On

Credits

Totals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1.00

-11-

Instructions for Form 8810 (2010)

Instructions For Form 8810 - Corporate Passive Activity Loss And Credit Limitations - 2010 Page 11

Related Articles

Related forms

Related Categories