Fillable Form 8404 - Interest Charge On Disc-Related Deferred Tax Liability

Form 8404 (2017)

Page

Line 3. Enter the net amount of all section

Line 8. The base period T-bill rate is defined

name in item E, and report the combined

income on line 2.

995(f)(2) adjustments to taxable income. See

in section 995(f)(4). The base period T-bill rate

Special Computation Rules, earlier, for details

is compounded daily based on the number of

Item D—Tax year. Enter in item D the

on the income (loss) and expense

days in the shareholder’s tax year to

calendar year or the beginning and ending

adjustments to be made. If more than one

determine the base period T-bill rate factor.

dates of the tax year shown on your tax return

adjustment is involved, attach a statement

for which the interest charge is figured.

The base period T-bill rate factor for 2017 is

listing each item and show the computation of

0.010151036 for a 365-day tax year. Enter the

Special Computation Rules

the net amount.

appropriate factor on line 8 of Form 8404. See

Lines 5 and 6. “Tax liability” on lines 5 and 6

Rev. Rul. 2017-23, which will be published in

Carrybacks. The determination of the

(with and without the deferred DISC income)

Internal Revenue Bulletin 2017-49, for a short

shareholder’s DISC-related deferred tax

means the amount of tax imposed on the

tax year or a 52–53 week tax year.

liability on lines 1 through 7 shall be made

IC-DISC shareholder for the tax year by

without taking into account any net operating

chapter 1 of the Internal Revenue Code (other

Privacy Act and Paperwork Reduction Act

loss (NOL), capital loss carryback, or credit

than taxes listed below) reduced by credits

carryback to the tax year.

Notice. We ask for the information on this

allowable against such tax (other than credits

form to carry out the Internal Revenue laws of

Carryovers. The determination of the

listed below).

the United States. We need it to figure and

shareholder’s tax liability (line 5) for the tax

collect the right amount of tax. Section 995(f)

See Special Computation Rules, earlier, for

year is made by disregarding any loss,

requires taxpayers to pay over to the IRS

rules for carrybacks and carryovers. These

deduction, or credit to the extent that such

interest on DISC-Related Deferred Tax

rules may affect the line 5 computation.

loss, deduction, or credit may be carried

Liability. This form is used to determine the

(either back or forward) by the shareholder to

The following taxes aren’t taken into

amount of tax that you owe. Sections 6001

any other tax year.

account.

and 6011 require you to provide the

Note: If the tax year is the last tax year to

• Alternative minimum tax.

requested information if the tax applies to

which the amount of carryforward (of loss,

you. Section 6109 requires you to provide

• Any other provisions described in section

deduction, or credit) may be carried, the line 3

your identifying number. Routine uses of this

26(b)(2) (relating to certain other taxes treated

adjustments and line 5 tax shall be figured

information include disclosing it to the

as not imposed by chapter 1).

with regard to the full amount of such

Department of Justice for civil and criminal

The following credits aren’t taken into

carryforward.

litigation and to other federal agencies, as

account.

For example, a shareholder had an NOL

provided by law. We may disclose the

• Section 31 (taxes withheld on wages).

carryover to 2018 of $12,000; $10,000 income

information to cities, states, the District of

to which $10,000 of the NOL can be applied;

Columbia, and U.S. Commonwealths or

• Section 32 (earned income credit).

$2,000 allowable NOL carryover to 2019; and

possessions to administer their tax laws. We

• Section 34 (fuels credit).

$5,000 deferred DISC income for 2018. In this

may also disclose this information to other

For 2017, a Form 1040 filer or a Form 1120

case, for purposes of figuring line 5, the

countries under a tax treaty, to federal and

filer using the above rules will generally figure

allowed NOL is $10,000. Note: If 2018 were

state agencies to enforce federal nontax

their line 6 tax liability using the following

the last tax year to which the $12,000 NOL

criminal laws, or to federal law enforcement

items shown on the following lines of those

could be carried, the full $12,000 NOL would

and intelligence agencies to combat terrorism.

forms. All other filers should use the

be allowed for purposes of figuring line 5 tax

If you don’t provide this information or provide

corresponding lines of other income tax

liability. The additional $2,000 loss would be

incomplete or fraudulent information, you may

returns. If you haven’t yet filed your return,

entered on line 3.

be subject to penalties.

estimate the line 6 tax liability based on all

Other adjustments. In figuring line 3

You aren’t required to provide the

information available to you.

adjustments, take into account any income

information requested on a form that is

2017

and expense adjustments that don’t result in

subject to the Paperwork Reduction Act

Form 1120

Form 1040

amounts that may be carried back or forward

unless the form displays a valid OMB control

Line

to other tax years. For example, in the case of

number. Books or records relating to a form

Tax less nonrefundable

an IC-DISC shareholder who is an individual,

or its instructions must be retained as long as

credits

7, Sch. J

the amount of medical expenses allowable as

their contents may become material in the

Plus: (1) Recapture taxes

a deduction under section 213 must be

administration of any Internal Revenue law.

redetermined for purposes of line 3

Generally, tax returns and return information

(2) Prior year minimum

adjustments. However, the amount allowable

are confidential, as required by section 6103.

tax credit .

54b

5d, Sch. J

as a charitable deduction under section 170

Less: (1) Alternative minimum

The time needed to complete and file this

isn’t redetermined because this adjustment

tax .

3, Sch. J

form will vary depending on individual

could result in a carryback or carryover.

(2) Additional child tax

circumstances. The estimated burden for

credit .

See Proposed Regulations section

business taxpayers filing this form is

1.995(f)-1(d) for other details regarding these

(3) American

approved under OMB control number

opportunity credit .

and other special computation rules.

1545-0123.

(4) Premium tax credit

If you have comments concerning the

Line-by-Line Instructions

(Form 8962)

accuracy of these time estimates or

(5) Credit for tax paid

suggestions for making this form simpler, we

Line 1. Enter on line 1 the taxable income or

on undistributed

would be happy to hear from you. You can

loss from your federal income tax return for

capital gains (Form

send us comments from

your tax year that ends with or includes the

2439) .

73a

19a, Sch. J

Or you can

IC-DISC’s tax year end. If you haven’t yet filed

(6) Health insurance

write to the Internal Revenue Service, Tax

your tax return, estimate your income or loss

credit for eligible

Forms and Publications, 1111 Constitution

based on all information available to you. See

recipients (Form

Ave. NW, IR-6526, Washington, DC 20224.

Amended Form 8404, earlier.

8885) .

73c

Don’t send the form to this office. Instead,

Line 2. Enter the deferred DISC income from

*Caution: Only use the portion of Form 1040,

see Where to file, earlier.

line 10, Part III of Schedule K (Form

line 63, or Form 1120, Schedule J, line 10,

1120-IC-DISC), for the IC-DISC tax year that

attributable to recapture of credits allowable

ends with or within your tax year.

against taxes treated as imposed under

chapter 1 (for example, recapture of

investment tax and low-income housing

credits). See section 26(b)(2) for a list of

recapture taxes to exclude.

Form 8404 - Interest Charge On Disc-Related Deferred Tax Liability - 2017 Page 2

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