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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 2006. 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 2006. The amounts in this column should be

reported on the forms normally used. See Reporting Allowed Credits on Tax Return on page 10.

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

credit that can then be applied against tax is

You are not required to provide the

Recordkeeping . . . . . . . . .

26 hr., 18 min.

reduced by the amount of the basis

information requested on a form that is

Learning about the law or

adjustment.

subject to the Paperwork Reduction Act

the form . . . . . . . . . . . . . .

5 hr., 15 min.

unless the form displays a valid OMB control

No basis adjustment can be elected on a

number. Books or records relating to a form

Preparing and sending the

partial disposition of the corporation’s

or its instructions must be retained as long

form to the IRS . . . . . . . . . .

5 hr., 55 min.

interest in a passive activity or if the

as their contents may become material in

disposition is not fully taxable. The amount

If you have comments concerning the

the administration of any Internal Revenue

of any unallowed credit, however, remains

accuracy of these time estimates or

law. Generally, tax returns and return

available to offset the tax attributable to net

suggestions for making this form simpler, we

information are confidential, as required by

passive and net active income.

would be happy to hear from you. See the

section 6103.

instructions for the tax return with which this

Paperwork Reduction Act Notice. We ask

The time needed to complete and file this

form is filed.

for the information on this form to carry out

form will vary depending on individual

the Internal Revenue laws of the United

circumstances. The estimated average time

States. You are required to give us the

is:

information. We need it to ensure that you

are complying with these laws and to allow

us to figure and collect the right amount of

tax.

-11-

Instructions For Form 8810 - Corporate Passive Activity Loss And Credit Limitations - 2006 Page 11

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