Instructions For Form 8845 - Indian Employment Credit

2017

Department of the Treasury

Internal Revenue Service

Instructions for Form 8845

Indian Employment Credit

Section references are to the Internal Revenue Code

2017. When any form, worksheet, or instruction refers to

unless otherwise noted.

these lines, treat the amounts on these lines as zero.

Line 5

Future Developments

Enter total Indian employment credits from:

For the latest information about developments related to

Schedule K-1 (Form 1065), Partner's Share of Income,

Form 8845 and its instructions, such as legislation

Deductions, Credits, etc., box 15 (code P);

enacted after they were published, go to

IRS.gov/

Schedule K-1 (Form 1120S), Shareholder's Share of

Form8845.

Income, Deductions, Credits, etc., box 13 (code P);

What’s New

Schedule K-1 (Form 1041), Beneficiary's Share of

Income, Deductions, Credits, etc., box 13 (code L); and

The Indian employment credit has expired for qualified

Form 1099-PATR, Taxable Distributions Received

wages and health care costs paid or incurred in tax years

From Cooperatives, box 10, or other notice of credit

beginning after 2016.

allocation.

At the time these instructions went to print, the

total qualified wages and qualified employee

Partnerships and S corporations report the above

health insurance costs paid or incurred during

credits on line 5. Also, estates and trusts that can allocate

CAUTION

calendar year 2017, formerly claimed on Line 1 and Line 2

the source credit to beneficiaries and cooperatives that

have expired. You can’t claim a credit on Line 1 and

can allocate the credit to patrons, report the above credits

Line 2 for qualified wages and qualified employee health

on line 5. All other filers report the above credits directly

insurance during calendar year 2017. Line 1 and Line 2

on Form 3800, Part III, line 1g, and don’t file Form 8845.

are now shown as “Reserved for future use” in case

Line 7

Congress extends the credit for 2017. To find out if

legislation extended the credit so you can claim Indian

Cooperatives. A cooperative described in section

employment credit paid or incurred on your 2017 return,

1381(a) must allocate to its patrons the credit in excess of

go to IRS.gov/Extenders.

its tax liability limit. Therefore, to figure the unused amount

of the credit allocated to patrons, the cooperative must

General Instructions

first figure its tax liability. While any excess is allocated to

patrons, any credit recapture applies as if the cooperative

Purpose of Form

had claimed the entire credit.

If the cooperative is subject to the passive activity rules,

Partnerships and S corporations must file this form to

include on line 5 any Indian employment credit from

claim the credit. All others are generally not required to

passive activities disallowed for prior years and carried

complete or file this form if their only source for this credit

forward to this year. Complete Form 8810, Corporate

is a partnership, S corporation, estate, trust, or

Passive Activity Loss and Credit Limitations, to determine

cooperative. Instead, they can report this credit directly on

the allowed credit that can be allocated to patrons. For

Form 3800, General Business Credit. The following

details, see the Instructions for Form 8810.

exceptions apply.

You are an estate or trust and the source credit can be

Estates and trusts. Allocate the Indian employment

allocated to beneficiaries. For more details, see the

credit on line 6 between the estate or trust and the

instructions for Form 1041, Schedule K-1, box 13, code L.

beneficiaries in the same proportion as income was

You are a cooperative and the source credit can or

allocated and enter the beneficiaries' share on line 7.

must be allocated to patrons. For more details, see the

If the estate or trust is subject to the passive activity

instructions for Form 1120-C, Schedule J, line 5c.

rules, include on line 5 any Indian employment credit from

passive activities disallowed for prior years and carried

Specific Instructions

forward to this year. Complete Form 8582-CR, Passive

Activity Credit Limitations, to determine the allowed credit

Lines 1 Through 4

that must be allocated between the estate or trust and the

beneficiaries. For details, see the Instructions for Form

These lines are now shown as “Reserved for future use” in

8582-CR.

case Congress extends the Indian employment credit for

Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the

United States. You are required to give us the 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.

Jan 17, 2018

Cat. No. 66389C

Instructions For Form 8845 - Indian Employment Credit - 2017

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