Looking for a Tax Form 8960 Templates? Download it for free!

pass-through entity's election doesn’t

1.1411-10(g) to apply the rules in section

corporation that’s a nonpassive activity

apply to any stock of the CFC or QEF that

1.1411-10(g).

(other than a trade or business of trading

you personally hold or subsequently

in financial instruments or commodities),

Special Rule for Traders in

acquire. If the entity doesn’t make the

see

Line 7—Other Modifications to

election, you may make the election for

Investment

Income, later, for a possible

Financial Instruments or

the stock of the CFC or QEF owned

adjustment to net investment income.

Commodities

through the entity.

Gains and losses from your trade or

Line 2—Ordinary Dividends

Timing of election. Your election applies

business of trading in financial instruments

to the tax year for which it’s made and

Enter the amount of ordinary dividends

or commodities aren’t subject to

later tax years, and applies to all interests

received. Include the following amount

self-employment taxes. However, interest

in the CFC or QEF that you later acquire.

from your return:

expense and other investment expenses

You can’t revoke the election. In general,

Form 1040, line 9a;

are deducted by a trader on Schedule C

the election must be made no later than

Form 1041, line 2a;

(Form 1040), Profit or Loss From

the first tax year beginning after 2013, in

Form 1041-QFT, line 2a;

Business, if the expenses are from the

which you include an amount in income for

Form 1040NR, ordinary dividends

trading business. A special rule may apply

regular income tax purposes under

received for period of U.S. residency

to a trader in financial instruments or

section 951(a) or 1293(a) for the stock of

shown on attached statement.

commodities to reduce net investment

the CFC or QEF, and are subject to NIIT or

income. The trader's interest and other

would be subject to NIIT if you made the

See

Special computational rules for

investment expenses, to the extent the

election for the stock of the CFC or QEF.

qualified funeral trusts (QFTs)

and

expenses aren’t used to reduce the

The election may be made for a tax year

Dual-status

individual, earlier.

trader's self-employment income, may be

beginning before 2014. The election can

deductible for NIIT.

Adjustments to dividends. If line 2

be made on an original or an amended

includes dividends from employer

return, provided that the tax year for which

Specific Instructions

securities held in an employee stock

the election is made, and all tax years

ownership plan (ESOP) that are

affected by the election, aren’t closed by

deductible under section 404(k) or Alaska

the period of limitations on assessment

Part I—Investment Income

Permanent Fund Dividends, include those

under section 6501. For more information,

amounts as negative modifications on

see Regulations section 1.1411-10(g).

Elections for Investment

line 7. See

Line 7—Other Modifications to

Income

Example. If in 2017, a single individual

Investment

Income, later.

acquires stock in a QEF, has a QEF

If you’re making the section 6013(g) or

inclusion of $5,000, and has MAGI of

6013(h) election (see

Election To File

Line 3—Annuities

$150,000, the individual wouldn’t have to

Jointly With Nonresident

make a section 1.1411-10(g) election for

Enter the gross income from all annuities,

Spouse—Section 6013(g) or

6013(h),

2017 because section 1411 isn’t

except annuities paid from the following:

earlier), check the corresponding

applicable. If in 2018, the individual has

Section 401 - Qualified pension,

checkbox.

profit-sharing, and stock bonus plans;

MAGI in excess of $200,000, and the

If you’re making or have made a

individual would like to take QEF

Section 403(a) - Qualified annuity plans

section 1.1411-10(g) election (see

inclusions into account for purposes of

purchased by an employer for an

Regulations Section 1.1411-10(g)

section 1411 in the same manner and in

employee;

Election, earlier), check the corresponding

Section 403(b) - Annuities purchased

the same tax year as those amounts are

checkbox and attach a statement to your

by public schools or Section 501(c)(3)

taken into account for IRC chapter 1

return as described earlier under

Content

purposes, the individual must make the

tax-exempt organizations;

requirements of

election.

section 1.1411-10(g) election for 2018 in

Section 408 - Individual Retirement

the time and manner described in

Accounts (IRAs) or Annuities;

Section 408A - Roth IRAs;

Regulations section 1.1411-10(g).

Line 1—Taxable Interest

Section 457(b) - Deferred

Content requirements of election. If

Enter the amount of taxable interest

compensation plans of a state and local

you’re making or made the election in a

received. Include the following amount

government and tax-exempt organization;

prior year, you must check the checkbox

from your return:

and

for “Regulations section 1.1411-10(g)

Form 1040, line 8a;

Amounts paid in consideration for

election” on the Form 8960 filed with your

Form 1041, line 1;

services (for example, distributions from a

original or amended return. In addition,

Form 1041-QFT, line 1a;

foreign retirement plan that are paid in the

you must attach a statement to your return

Form 1040NR, taxable interest received

form of an annuity and include investment

which includes the following:

for period of U.S. residency shown on

income that was earned by the retirement

Your name and SSN (individuals) or

attached statement.

plan).

EIN (estates and trusts).

See

Special computational rules for

The following information for each CFC

How your annuities are reported to

qualified funeral trusts (QFTs)

and

you. Net investment income from

or QEF for which an election is made:

Dual-status

individual, earlier.

annuities is reported to a recipient on

1. The name of the CFC or QEF, and

Form 1099-R, Distributions From

Adjustments to interest. Interest

2. Either the EIN of the CFC or QEF,

Pensions, Annuities, Retirement or

income earned in the ordinary course of

or, if the CFC or QEF doesn’t have an EIN,

Profit-Sharing Plans, IRAs, Insurance

your non-section 1411 trade or business is

the reference ID number of the CFC or

Contracts, etc. However, the amount

excluded from net investment income. If

QEF.

reported on Form 1099-R may also

this type of interest income is included in

In addition, list separately each CFC or

include annuity payments from retirement

line 1, use line 7 to adjust your net

QEF for which an election is being made

plans that are exempt from NIIT. Amounts

investment income.

for the first time with this return and

subject to NIIT should be identified with

include on the statement a declaration that

If line 1 includes self-charged interest

code “D” in box 7. If code “D” is shown in

you elect under Regulations section

income received from a partnership or S

Instructions for Form 8960 (2017)

-5-

Instructions For Form 8960 - Net Investment Income Tax - Individuals, Estates, And Trusts - 2017 Page 5

Related Articles

Related forms

Related Categories