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2013

Department of the Treasury

Internal Revenue Service

Instructions for Form 8804-W

(WORKSHEET)

Installment Payments of Section 1446 Tax for Partnerships

Underpayment of

Lines 1 through 6—Current

Section references are to the Internal Revenue

Code unless otherwise noted.

Estimated Section 1446

Year Safe Harbor

Future Developments

Tax

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

For the latest information about

determine the foreign partner's allocable

A partnership that does not make

developments related to Form 8804-W,

share of ECTI, see Effectively Connected

estimated section 1446 tax payments

and its instructions, such as legislation

Taxable Income in the Instructions for

when due may be subject to an

Forms 8804, 8805, and 8813. Enter on

enacted after they were published, go to

underpayment penalty for the period of

lines 1i, 1m, and 1q the specified types of

underpayment. See Schedule A (Form

ECTI if such partner would be entitled to

8804) for details.

What's New

use a preferential rate on such income or

How To Make Estimated

gain (see Regulations section 1.1446-3(a)

For tax years beginning after December

(2)). For tiered partnerships see

Section 1446 Tax

31, 2012, the American Taxpayer Relief

Regulations section 1.1446-5.

Act of 2012, increased the maximum tax

Payments

A partner may be entitled to use a

rate for individuals to 39.6%, and the

A partnership that is required to make an

preferential rate on the following types of

maximum tax rate on capital gains to 20%.

installment payment of section 1446 tax

income or gain.

Therefore, under Regulations section

must file Form 8813, Partnership

1.1446-3(a)(2), the Form 8804-W has

1. Line 1i—See section 1(h)(4) and

Withholding Tax Payment Voucher

been modified to reflect the highest tax

the instructions for line 18, Schedule D

(Section 1446). Furthermore, the

rates for these two types of income. As a

(Form 1040), for more information

partnership is generally required to notify

result, substantial changes have been

regarding 28% rate gain.

each foreign partner of the section 1446

made to the 2013 Form 8804-W.

2. Line 1m—See section 1(h)(6) and

tax paid on the partner's behalf within 10

the instructions for line 19, Schedule D

General Instructions

days of the installment payment due date.

(Form 1040), for more information

See Regulations section 1.1446-3(d) and

regarding unrecaptured section 1250 gain.

the Instructions for Forms 8804, 8805, and

Purpose of Form

3. Line 1q—Adjusted net capital gain

8813 for more information.

is net capital gain, as defined in section

Partnerships that have effectively

Refiguring Estimated

1222(11), reduced (but not below zero) by

connected taxable income (ECTI)

the sum of (a) unrecaptured section 1250

Section 1446 Tax

allocable to foreign partners can use the

gain and (b) 28% rate gain, plus qualified

Form 8804-W (WORKSHEET) to

If, after the partnership figures and makes

dividend income. See section 1(h)(3).

determine the proper estimated section

an installment payment of estimated

1446 tax payments.

If the partnership has net ordinary loss,

section 1446 tax, it finds that its section

net short-term capital loss, or net 28% rate

1446 tax liability for the year will be more

Who Must Make Estimated

loss, each net loss should be netted

or less than originally estimated, it may

Section 1446 Tax

against the appropriate categories of

have to refigure its required installments. If

income and gain to determine the

Payments

earlier installments were underpaid, the

amounts of income and gain to be entered

partnership may owe a penalty for

Partnerships generally must make

on lines 1i, 1m, and 1q, respectively. See

underpayment of estimated tax. An

installment payments of estimated section

section 1(h) and Notice 97-59, 1997-45

immediate catch-up payment should be

1446 tax if they expect the aggregate tax

I.R.B. 7, for rules for netting gains and

made to reduce the amount of any penalty

on the ECTI that is allocable to all foreign

losses.

resulting from the underpayment of any

partners to be $500 or more.

earlier installments, whether caused by a

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

change in estimate, failure to make a

reduction amounts for state and local

When To Make Estimated

payment, or a mistake.

taxes under Regulations section

Section 1446 Tax

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

Payments

Specific Instructions

State and Local Taxes in the Instructions

for Forms 8804, 8805, and 8813 for

The installments are due by the 15th day

additional information. The netting rules

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

Part I—Determination of

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

partnership's tax year. If any date falls on

Installment Payments

be considered in determining the category

a Saturday, Sunday, or legal holiday, the

of income the reduction amounts offset.

installment is due on the next regular

Complete Form 8804-W for each

business day.

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

installment payment of section 1446 tax

reduction amounts resulting from certified

based on the information available at the

partner-level items received from foreign

time of the installment payment.

partners using Form 8804-C. See

Certification of Deductions and Losses in

Feb 22, 2013

Cat. No. 51675X

Instructions For Form 8804-W (Worksheet) - Installment Payments Of Section 1446 Tax For Partnerships - 2013

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