Instructions For Form 8804-W - 2009 printable pdf download

2 0 09

Department of the Treasury

Internal Revenue Service

Instructions for Form

8804-W

income and gain to determine the

Section references are to the Internal

How To Make Estimated

amounts of income and gain to be

Revenue Code unless otherwise noted.

Section 1446 Tax

entered on lines 1e, 1i, and 1m,

respectively. See section 1(h) and Notice

Payments

97-59, 1997-45 I.R.B. 7, for rules for

What’s New

A partnership that is required to make an

netting gains and losses.

•

installment payment of section 1446 tax

Final regulations were issued under

Lines 1b, 1f, 1j, and 1n. Enter the

must file Form 8813, Partnership

section 1.1446-6. These final regulations

reduction amounts for state and local

Withholding Tax Payment Voucher

address special rules to reduce a

taxes under Regulations section

(Section 1446). Furthermore, the

partnership’s section 1446 tax with

1.1446-6(c)(1)(iii). See Reductions for

partnership is generally required to notify

respect to a foreign partner’s allocable

State and Local Taxes in the Instructions

each foreign partner of the section 1446

for Forms 8804, 8805, and 8813 for

share of effectively connected taxable

tax paid on the partner’s behalf within 10

additional information. The netting rules

income.

days of the installment payment due date.

•

under section 1(h) and Notice 97-59 must

See Regulations section 1.1446-3(d) and

Effective July 29, 2008, Form 8804-C,

be considered in determining the category

the Instructions for Forms 8804, 8805,

Certificate of Partner-Level Items to

of income the reduction amounts offset.

and 8813 for more information.

Reduce Section 1446 Withholding, is the

Lines 1c, 1g, 1k, and 1o. Enter the

sole method for foreign partners to certify

Refiguring Estimated

reduction amounts resulting from certified

partner-level items.

•

partner-level items received from foreign

Section 1446 Tax

The instructions for lines 1, 22, and 32

partners using Form 8804-C. See

have been modified to reflect the

If, after the partnership figures and makes

Certification of Deductions and Losses in

reduction for state and local taxes

an installment payment of estimated

the Instructions for Forms 8804, 8805,

permitted under Regulations section

section 1446 tax, it finds that its section

and 8813 for additional information. The

1.1446-6(c)(1)(iii).

1446 tax liability for the year will be more

netting rules under section 1(h) and

or less than originally estimated, it may

Notice 97-59 must be considered in

have to refigure its required installments.

General Instructions

determining the category of income the

If earlier installments were underpaid, the

reduction amounts offset.

partnership may owe a penalty for

Line 6. Add lines 2 through 5.

underpayment of estimated tax. An

Who Must Make Estimated

immediate catch-up payment should be

Alternative tax for foreign corporate

Section 1446 Tax

made to reduce the amount of any

partners with qualified timber gain. In

penalty resulting from the underpayment

the case of a foreign corporate partner, if

Payments

of any earlier installments, whether

taxable income expected for the year (line

Partnerships generally must make

caused by a change in estimate, failure to

1a) includes both a net capital gain and

installment payments of estimated section

make a payment, or a mistake.

qualified timber gain, an alternative

1446 tax if they expect the aggregate tax

maximum 15% capital gains tax may

on the effectively connected taxable

apply to the qualified timber gain. For this

income (ECTI) that is allocable to all

Specific Instructions

purpose, a qualified timber gain means

foreign partners to be $500 or more.

the net gains described in sections 631(a)

and (b), determined by taking into

Part I—Determination of

When To Make Estimated

account only trees held more than 15

years. Only qualified timber gains for the

Installment Payments

Section 1446 Tax

period that begins after May 22, 2008,

Complete Form 8804-W for each

and before May 23, 2009, are eligible for

Payments

installment payment of section 1446 tax

the alternative tax.

based on the information available at the

The installments are due by the 15th day

With respect to a foreign corporate

time of the installment payment.

of the 4th, 6th, 9th, and 12th months of

partner with both a net capital gain and a

the partnership’s tax year. If any date falls

Lines 1 through 6—Current

qualified timber gain, enter on line 6 the

on a Saturday, Sunday, or legal holiday,

Year Safe Harbor

smaller of the alternative tax or the

the installment is due on the next regular

amount on line 2. Use Form 1120-W, Part

Lines 1a, 1e, 1i, and 1m. To determine

business day.

II to compute the alternative tax. For

the foreign partner’s allocable share of

these purposes, the following

ECTI, see Effectively Connected Taxable

modifications must be made to Form

Income in the Instructions for Forms

Underpayment of

1120-W, Part II:

8804, 8805, and 8813. With respect to

•

On lines 30, 32, and 35, substitute “the

Estimated Section 1446

lines 1e, 1i, and 1m, enter the specified

amount shown on Form 8804-W, line 1d”

types of ECTI if such partner would be

Tax

for “Part I, line 1.”

entitled to use a preferential rate on such

•

On line 33, enter the product of line 32

A partnership that does not make

income or gain (see Regulations section

times 35%.

1.1446-3(a)(2)).

estimated section 1446 tax payments

when due may be subject to an

If the partnership has net ordinary loss,

As mentioned above, the Form

underpayment penalty for the period of

net short-term capital loss, or net 28%

1120-W, Part II, line 37 result (computed

underpayment. See Schedule A (Form

rate loss, each net loss should be netted

with the modifications noted above) is

8804) for details.

against the appropriate categories of

compared to Form 8804-W, line 2, and

Cat. No. 51675X

Instructions For Form 8804-W - 2009

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