All cooperatives must use new federal income tax form 1120-C.
The new form must be used by cooperatives for tax years ending on or after Dec. 31, 2006. So, cooperatives on a calendar year tax year will be using Form 1120-C to report their 2006 income.
Cooperatives with total assets of $10 million or more will need to attach Schedule M-3 to their Form 1120-C. Schedule M-3 asks questions about the taxpayer's financial statements and reconciles any differences between book income and reported income for tax purposes.
By the time this magazine is mailed, IRS will likely have released both the final version of Form 1120-C and the Instructions. Cooperatives that have not already done so are encouraged to meet with their tax preparer to discuss Form 1120-C and any related electronic filing requirements so the transition to the new form does not disrupt other operations or lead to avoidable disputes with the IRS.
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|Date:||Nov 1, 2006|
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