Instructions For Schedule A (Form 8804) - 2010 printable pdf download

2010

Department of the Treasury

Internal Revenue Service

Instructions for Schedule A

(Form 8804)

“prior tax year” includes the amended

both of these methods to figure its

Section references are to the Internal

Form 8804, but only if the amended Form

required installments. The annualized

Revenue Code unless otherwise noted.

8804 is filed before the applicable

income installment or adjusted seasonal

General Instructions

installment due date.

installment may be less than the required

installment under the current year safe

The penalty is figured separately for

Purpose of Form

harbor (increased by any reduction

each installment due date. Therefore, the

recaptured under section 6655(e)(1)(B))

partnership may owe a penalty for an

Partnerships that have effectively

for one or more due dates. Using one or

earlier due date even if it paid enough tax

connected taxable income (ECTI)

both of these methods may reduce or

later to make up the underpayment. This

allocable to foreign partners use

eliminate the penalty for those due dates.

is true even if the partnership is due a

Schedule A (Form 8804) to determine:

refund when its return is filed. However,

Use Parts IV through VI on pages 2

•

Whether they are subject to the penalty

the partnership may be able to reduce or

through 4 of Schedule A (Form 8804) to

for underpayment of estimated tax and, if

eliminate the penalty by using the

figure one or more required installments.

so,

annualized income installment method or

If Parts IV through VI are used for any

•

The amount of the underpayment

the adjusted seasonal installment

payment due date, those Parts must be

penalty.

method. See the instructions for Parts IV

used for all subsequent payment due

Who Must File

and V for details.

dates. To arrive at the amount of each

required installment, Part VI uses the

Generally, the partnership does not have

Exception to the Penalty

smallest of:

to file this schedule because the IRS will

•

The adjusted seasonal installment (if

A partnership will not have to pay a

figure the amount of the penalty and

applicable),

penalty if the tax shown on line 5e of its

notify the partnership of any amount due.

•

The annualized income installment (if

2010 Form 8804 is less than $500.

However, even if the partnership does not

applicable), or

owe a penalty, complete and attach this

•

How To Use Schedule A

The current year safe harbor

schedule to the partnership’s Form 8804

(increased by any reduction recaptured

if the Part II, line 1 amount on page 1 is

Complete this schedule as follows:

under section 6655(e)(1)(B)).

$500 or more and either of the following

•

Check one or both of the boxes in Part

Follow the steps below to determine

applies:

I that apply. If the partnership checks a

which parts of the form have to be

1. The adjusted seasonal installment

box in Part I, attach Schedule A (Form

completed:

method is used.

8804) to Form 8804. Be sure to check the

•

If the partnership is using only the

2. The annualized income installment

box on Form 8804, line 8.

adjusted seasonal installment method,

•

method is used.

If Part II, line 1 is $500 or more,

check the applicable box in Part I and

complete the rest of page 1 to determine

complete Parts IV and VI of Schedule A

the underpayment for any of the

Who Must Pay the

(Form 8804).

installment due dates.

•

If the partnership is using only the

Underpayment Penalty

•

If there is an underpayment on line 12

annualized income installment method,

(column (a), (b), (c), or (d)), go to Part VII

Generally, a partnership is subject to the

check the applicable box in Part I and

to figure the penalty.

penalty if it did not timely pay in

complete Parts V and VI of Schedule A

•

Complete Parts IV through VI as

installments at least the smaller of:

(Form 8804).

appropriate if the partnership uses the

•

If the partnership is using both

1. The tax shown on line 5e of its

adjusted seasonal installment method

methods, check both of the boxes in Part

2010 Form 8804 or

and/or the annualized income installment

I and complete all three parts (Parts IV

2. The total section 1446 tax that

method.

through VI) of Schedule A (Form 8804).

would have been due for 2009, without

regard to reductions for certified foreign

Part II. Current Year and

partner-level items, on the ECTI allocable

Specific Instructions

Prior Year Safe Harbors

to foreign partners for 2009, provided that

(1) this amount is at least 50% of the sum

Line 2 (prior year safe harbor). Enter

of the amounts shown on lines 4d, 4h, 4l,

Part I. Reasons for Filing

the total section 1446 tax that would have

and 4p of its 2010 Form 8804 and (2) the

Adjusted seasonal installment method

been due for 2009, without regard to

tax year was for a full 12 months. See the

and/or annualized income installment

reductions for certified foreign

instructions for line 2 below for more

method. If the partnership’s income

partner-level items on the ECTI allocable

details.

to foreign partners for 2009.

varied during the year because, for

In these instructions, “Form 8804”

example, it operated its business on a

The partnership may generally use the

generally refers to the partnership’s

seasonal basis, it may be able to lower or

prior year safe harbor only if it paid the

original Form 8804. However, an

eliminate the amount of one or more

required amount using that method for

amended Form 8804 is considered the

required installments by using the

each of its installment payments of

original Form 8804 if the amended Form

adjusted seasonal installment method

section 1446 tax during the tax year.

8804 is filed by the due date (including

and/or the annualized income installment

However, see Regulations section

extensions) of the original Form 8804.

method.

1.1446-3(b)(3)(ii) for an exception. Also,

Example. A ski shop, which receives

see the Note below. In addition, the

Also, for purposes of determining a

required installment, if an amended Form

most of its income during the winter

partnership may only use the prior year

safe harbor if all of the following apply:

8804 is filed for the prior tax year, then

months, may benefit from using one or

Cat. No. 36325U

Instructions For Schedule A (Form 8804) - 2010

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