Instructions For Form 1128 - Application To Adopt, Change, Or Retain A Tax Year - Internal Revenue Service - 2008
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8Department of the Treasury
Instructions for Form 1128
Internal Revenue Service
(Rev. January 2008)
Application To Adopt, Change, or Retain a Tax Year
•
Section references are to the Internal
Regulations section 1.964-1T(c)(5)
A corporation electing to be treated
Revenue Code unless otherwise noted.
for the definition of controlling
as an S corporation by filing Form
domestic shareholders of a CFC or
2553, Election by a Small Business
10/50 corporation.
Corporation, and requesting to
What’s New
change or retain its tax year.
If Form 1128 is filed on behalf of a
Individuals
CFC or 10/50 corporation, each
Trusts. A checkbox was added to
controlling domestic shareholder
Part I, line 1 for trusts. Certain types
Newly married individuals changing to
must attach to its tax return a copy of
of trusts are now permitted to use the
the tax year of the other spouse in
the form and all other domestic
automatic approval request
order to file a joint return (Regulations
shareholders must be provided a
procedures. Refer to Section B of
section 1.442-1(d) must be followed).
written notice of the election. See
Part II for the details.
Exempt Organizations
Temporary Regulations section
1.964-1T(c)(3) for details.
General Instructions
An organization exempt under
section 501(a) does not file Form
Exceptions
1128 unless the organization has
Purpose of Form
changed its tax year at any time
Do not file Form 1128 in the following
File Form 1128 to request a change
within a 10-calendar-year period, and
circumstances.
in tax year. Partnerships, S
the organization has had an annual
corporations, personal service
filing requirement during that 10-year
Corporations
corporations (PSCs), or trusts may be
period (see Rev. Proc. 85-58, 1985-2
•
A corporation adopting its first tax
required to file the form to adopt or
C.B. 740). This exception does not
year.
retain a certain tax year.
apply to organizations exempt from
•
A corporation required to change
tax under section 521, 526, 527, or
Who Must File
its tax year to file a consolidated
528; organizations described in
return with its new common parent
section 401(a); and organizations
Generally, all taxpayers must file
(see Regulations sections 1.442-1(c)
involved in a group change in tax
Form 1128 to adopt, change, or retain
and 1.1502-76(a)).
year for all its subordinate
a tax year. However, see Exceptions
•
A foreign sales corporation (FSC)
organizations.
below.
or an interest charge domestic
Trusts
The common parent of a
international sales corporation
•
consolidated group that files a
(IC-DISC) changing to the tax year of
A trust (other than a tax-exempt
consolidated return files one Form
the U.S. shareholder with the highest
trust, charitable trust, or a grantor
1128 for the consolidated group. In
percentage of voting power (see
trust under Rev. Rul. 90-55, 1990-2
addition, the common parent
section 441(h)). Also see Temporary
C.B. 161) that adopts the calendar
corporation must (a) indicate that the
Regulations section 1.921-1T(b)(4).
year as required by section 644.
•
Form 1128 is for the common parent
However, a FSC or IC-DISC must file
Certain revocable trusts electing to
corporation and all its subsidiaries
Form 1128 to change its tax year
be treated as part of an estate.
•
and (b) answer all relevant questions
concurrently, if a tax year change has
An employee plan or trust filing
on the application for each member of
been made by the U.S. shareholder.
Form 5308, Request for Change in
the consolidated group.
Plan/Trust Year, to change its plan or
Partnerships, S
trust year.
If a consolidated group filing a
Corporations, and Personal
consolidated return wants to change
When To File
its tax year by using Rev. Proc.
Service Corporations
2006-45, every member of the group
•
A newly formed partnership
Tax Year Adoption, Change,
must meet the revenue procedure
adopting a required tax year or a
requirements.
or Retention
52-53 week tax year with reference to
•
If a controlled foreign corporation
such required tax year.
To request a ruling to adopt,
•
(CFC) or 10/50 corporation
A partnership, S corporation, or
change, or retain a tax year, file Form
(noncontrolled section 902
PSC terminating its section 444
1128 by the due date (not including
corporation) does not have a U.S.
election (see Temporary Regulations
extensions) of the federal income tax
trade or business, then the CFC’s
section 1.444-1T(a)(5)).
return for the first effective year. Do
•
controlling domestic shareholder(s)
A newly formed partnership, an
not file earlier than the day following
must file Form 1128 on behalf of such
electing S corporation, or a newly
the end of the first effective year. In
foreign corporation to change its tax
formed PSC that elects under section
the case of a change in tax year, the
year (except as provided above with
444 a tax year other than the required
first effective year is the short period
respect to a controlling domestic
tax year by filing Form 8716, Election
required to effect the change.
•
shareholder that is a member of a
To Have a Tax Year Other Than a
To request automatic approval to
consolidated group). See Temporary
Required Tax Year.
change a tax year under Rev. Proc.
Cat. No. 61752V
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