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expense deduction, reduced by any unused

instructions for Form 6252 for more

line 28, column (h), of Schedule E (Form

carryover of the deduction for this property.

information. Also see section 453A(c) for

1040).

This amount may be different than the

details on making the computation.

Code P. Unrelated business taxable

amount of section 179 expense you

Code K. Section 1260(b) information. The

income. The partnership will report any

deducted for the property if your interest in

partnership will report any information you

information you need to figure unrelated

the partnership has changed.

need to figure the interest due under section

business taxable income under section

8. If the disposition is due to a casualty

1260(b). If the partnership had gain from

512(a)(1) (but excluding any modifications

or theft, a statement providing the

certain constructive ownership transactions,

required by paragraphs (8) through (15) of

information you need to complete Form

your tax liability must be increased by the

section 512(b)) for a partner that is a

4684, Casualties and Thefts.

interest charge on any deferral of gain

tax-exempt organization.

9. If the sale was an installment sale

recognition under section 1260(b). Report

Note. A partner is required to notify the

made during the partnership’s tax year, any

the interest on Form 1040, line 62. Write

partnership of its tax-exempt status.

information you need to complete Form

“1260(b)” and the amount of the interest on

Code Q. Other information. The

6252, Installment Sale Income. The

the dotted line to the left of line 62. See

partnership will report:

partnership also must separately report your

section 1260(b) for details, including how to

1. Any information a publicly traded

share of all payments received for the

figure the interest.

partnership needs to determine whether it

property in the following tax years. See the

Code L. Interest allocable to production

meets the 90% qualifying income test of

instructions for Form 6252 for details.

expenditures. The partnership will report

section 7704(c)(2).

any information you need relating to interest

Code G. Recapture of section 179

Note. A partner is required to notify the

expense that you are required to capitalize

deduction. The partnership will report your

partnership of its status as a publicly traded

under section 263A for production

distributive share of any recapture of section

partnership.

expenditures. See Regulations sections

179 expense deduction if business use of

2. Any information or statements you

1.263A-8 through 1.263A-15 for more

any property for which the section 179

need to comply with the registration and

information.

expense deduction was passed through to

disclosure requirements under sections

Code M. CCF nonqualified withdrawals.

partners dropped to 50 percent or less. If

6111 and 6662(d)(2)(B)(ii) and the list

The partnership will report your nonqualified

business use of the property dropped to 50

keeping requirements of Regulations section

withdrawals by the partnership from a

percent or less, the partnership must

301.6112-1. See Form 8264 and Notice

capital construction fund (CCF). These

provide all the following information.

2004-80, 2004-50 I.R.B. 963 for more

withdrawals are taxed separately from your

1. Your distributive share of the

information.

other gross income at the highest marginal

depreciation allowed or allowable (not

3. Any information you need to complete

ordinary income or capital gains tax rate.

including the section 179 expense

a disclosure statement for reportable

Attach a statement to your federal income

deduction).

transactions in which the partnership

tax return to show your computation of both

2. Your distributive share of the section

participates. If the partnership participates in

the tax and interest for a nonqualified

179 expense deduction (if any) passed

a transaction that must be disclosed on

withdrawal. Include the tax and interest on

through for the property and the

Form 8886, Reportable Transaction

Form 1040, line 62. To the left of line 62,

partnership’s tax year(s) in which the

Disclosure Statement, both you and the

write the amount of tax and interest and

amount was passed through. Reduce this

partnership may be required to file Form

‘‘CCF.’’

amount by the portion, if any, of your

8886 for the transaction. The determination

Code N. Information needed to figure

unused (carryover) section 179 expense

of whether you are required to disclose a

depletion — oil and gas. This is your share

deduction for this property.

transaction of the partnership is based on

of gross income from the property, share of

the category(s) under which the transaction

Code H. Special basis adjustment. If you

production for the tax year, etc., needed to

qualifies for disclosure and is determined by

acquired an interest in an oil and gas

figure your depletion deduction for oil and

the partnership. See the instructions for

partnership, you are required to attach a

gas wells. The partnership should also

Form 8886 for details.

statement to your return for the year of the

allocate to you a share of the adjusted basis

4. Inversion gain. The partnership will

transfer that shows your computation of any

of each partnership oil or gas property. See

provide a statement showing the amounts of

section 743(b) basis adjustment and your

Pub. 535 for how to figure your depletion

each type of income or gain that is included

allocation of the basis adjustment to specific

deduction.

in inversion gain. The partnership has

properties. The partnership will provide the

Code O. Amortization of reforestation

included inversion gain in income elsewhere

information you need to prepare this

costs. The partnership will provide a

on Schedule K-1. Inversion gain is also

statement. See Regulations sections

statement identifying your share of the

reported under code Q because your

1.743(b)-1(k)(1)(ii) and (iii) for more

amortizable basis of reforestation

taxable income and alternative minimum

information.

expenditures paid or incurred before

taxable income cannot be less than the

Code I. Section 453(l)(3) information. The

October 23, 2004. The partnership will

inversion gain. Also, your inversion gain (a)

partnership will report any information you

separately report your share of the

is not taken into account in figuring the

need to figure the interest due under section

amortizable basis for reforestation

amount of net operating loss (NOL) for the

453(l)(3) with respect to the disposition of

expenditures for the current tax year and the

tax year or the amount of NOL that can be

certain timeshares and residential lots on

7 preceding tax years. Your amortizable

carried over to each tax year, (b) may limit

the installment method. If you are an

basis of reforestation expenditures for each

the amount of your credits, and (c) is treated

individual, report the interest on Form 1040,

tax year from all properties is limited to

as income from sources within the U.S. for

line 62. Write “453(l)(3)” and the amount of

$10,000 ($5,000 if married filing separately),

the foreign tax credit. See section 7874 for

the interest on the dotted line to the left of

including your distributive share of the

details.

line 62.

partnership’s expenditures and any qualified

5. Any other information you may need

reforestation expenditures you separately

Code J. Section 453A(c) information. The

to file your return not shown elsewhere on

paid or incurred. To figure your allowable

partnership will report any information you

Schedule K-1.

amortization, see section 194 and Pub. 535.

need to figure the interest due under section

The partnership should give you a

453A(c) with respect to certain installment

Follow the instructions for Form 8582 to

description and the amount of your share for

sales. If you are an individual, report the

report a deduction allocable to a passive

each of these items.

interest on Form 1040, line 62. Write

activity. If you materially participated in the

“453A(c)” and the amount of the interest on

reforestation activity, report the deduction on

the dotted line to the left of line 62. See the

-12-

Partner’s Instructions for Schedule K-1

Partner'S Instructions For Schedule K-1 (Form 1065) - Partner'S Share Of Income, Deductions, Credits, Etc. (For Partner'S Use Only) - 2004 Page 12

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