1120-C U.S. Income Tax Return for Cooperative Associations

Form

1120-C

Number, street, and room or suite no. (If a P.O. box, see instructions.)

C Check if:
(1) Farmers’ tax exempt
cooperative
(2) Nonexempt
cooperative

Tax and Payments

Deductions (See instructions for limitations on deductions.)

Income

Initial return

City or town, state, and ZIP code

(2)

Final return

(3)

Name change

(4)

Address change

c Bal

©

1a
2
3
4
5
6
7
8
9
10

Gross receipts or sales
b Less returns and allowances
Cost of goods sold (Schedule A, line 9)
Gross profit. Subtract line 2 from line 1c
Dividends (Schedule C, line 19)
Interest
Gross rents and royalties
Capital gain net income (attach Schedule D (Form 1120))
Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797)
Other income (see instructions—attach schedule)
Total income. Add lines 3 through 9

11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

Compensation of officers (Schedule E, line 4)
Salaries and wages (less employment credits)
Bad debts
Rents
Taxes and licenses
Interest
Charitable contributions
Depreciation not claimed in Schedule A or elsewhere on return (attach Form 4562)
Advertising
Pension, profit-sharing, etc., plans
Employee benefit programs
Domestic production activities deduction (attach Form 8903)
Other deductions (attach schedule)
Total deductions. Add lines 11 through 23
Taxable income before section 1382, NOL, and special deductions. Subtract line 24 from line 10
Less: a Deductions and adjustments under section 1382
26a
(Schedule H, line 5)
26b
b Net operating loss deduction (see instructions)
c Special deductions (Schedule C, line 20)
26c

27
28
29a
b
c
e
f
g
h
30
31
32
33

Taxable income. Subtract line 26d from line 25 (see instructions)
Total tax (Schedule J, line 9)
2005 overpayment credited to 2006 29a
29b
2006 estimated tax payments
) d Bal © 29d
2006 refund applied for on Form 4466 29c (
29e
Tax deposited with Form 7004
29f
Credits: (1) Form 2439
(2) Form 4136
29g
Credit for federal telephone excise tax paid (attach Form 8913)
29h
Section 1383 credit (see instructions)
©
Estimated tax penalty (see instructions). Check if Form 2220 is attached
Amount owed. If line 29i is smaller than the total of lines 28 and 30, enter amount owed
Overpayment. If line 29i is larger than the total of lines 28 and 30, enter amount overpaid
Refunded ©
Enter amount of line 32 you want: Credited to 2007 estimated tax ©

Sign
Here

2006

B Employer identification number

D Check if:

(1)

OMB No. 1545-2052

, 2007

Name

A Check if:
1 Consolidated return
(attach Form 851)
2 Schedule M-3 (Form
1120) required
(attach Sch. M-3)
3 Form 1120 filed in
previous tax year

Please type or print

Department of the Treasury
Internal Revenue Service

U.S. Income Tax Return for Cooperative Associations
For calendar year 2006 or tax year beginning
, 2006, ending
© See separate Instructions.

©

©

(5)

Amended return

1c
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25

26d
27
28

29i
30
31
32
33

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true,
correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

©

Paid
Preparer’s
Use Only

Signature of officer
Preparer’s
signature

©

Firm’s name (or
yours if self-employed),
address, and ZIP code

Date

©

May the IRS discuss this return with
the preparer shown below (see
instructions)?
Yes
No

Title
Date

©

For Privacy Act and Paperwork Reduction Act Notice, see separate instructions.

Preparer’s SSN or PTIN

Check if
self-employed
EIN
Phone no.
Cat. No. 47554F

(

)
Form

1120-C

(2006)

Form 1120-C (2006)

Schedule A
1
2
3
4
a
b
5
6a
b
7
8
9
10 a

b
c
d
e
f

1
Inventory at beginning of year
2
Purchases
3
Cost of labor
Per-unit retain allocations paid in:
4a
Qualified per-unit retain certificates
4b
Money or other property (except nonqualified per-unit certificates)
5
Nonqualified per-unit retain certificates redeemed this year
6a
Additional section 263A costs (attach schedule)
6b
Other costs (attach schedule)
7
Total. Add lines 1 through 6b
8
Inventory at end of year
9
Cost of goods sold. Subtract line 8 from line 7. Enter here and on line 2, page 1
Check all methods used for valuing closing inventory:
(i)
Cost as described in Regulations section 1.471-3
Lower of cost or market as described in Regulations section 1.471-4
(ii)
(iii)
Other (Specify method used and attach explanation) ©
Check if there was a writedown of subnormal goods as described in Regulations section 1.471-2(c)
Check if the LIFO inventory method was adopted this tax year for any goods (if checked, attach Form 970)
If the LIFO inventory method was used for this tax year, enter percentage (or amounts) of
10d
closing inventory computed under LIFO
If property is produced or acquired for resale, do the rules of section 263A apply to the cooperative?
Was there any change in determining quantities, cost, or valuations between opening and closing inventory?
If “Yes,” attach explanation.

Schedule C
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19

20

Page

2

Cost of Goods Sold (see instructions)

Dividends and Special Deductions
(see instructions)

Dividends from less-than-20%-owned domestic corporations (other
than debt-financed stock)
Dividends from 20%-or-more-owned domestic corporations (other
than debt-financed stock)
Dividends on debt-financed stock of domestic and foreign
corporations
Dividends on certain preferred stock of less-than-20%-owned public
utilities
Dividends on certain preferred stock of 20%-or-more-owned public
utilities
Dividends from less-than-20%-owned foreign corporations and
certain FSCs
Dividends from 20%-or-more-owned foreign corporations and certain
FSCs
Dividends from wholly owned foreign subsidiaries
Total. Add lines 1 through 8. See instructions for limitation
Dividends from domestic corporations received by a small business investment
company operating under the Small Business Investment Act of 1958
Dividends from affiliated group members
Dividends from certain FSCs
Dividends from foreign corporations not included on lines 3, 6, 7, 8,
11, or 12
Income from controlled foreign corporations under subpart F (attach
Form(s) 5471)
Foreign dividend gross-up
IC-DISC and former DISC dividends not included on lines 1, 2, or 3
Other dividends
Deduction for dividends paid on certain preferred stock of public utilities
Total dividends. Add lines 1 through 17. Enter here and on line 4,
©
page 1

(a) Dividends
received

©
©

Yes
Yes

No
No

(c) Deduction
((a) 3 (b))

(b) %

70
80
See
instructions

Total special deductions. Add lines 9, 10, 11, 12, and 18. Enter here and on line 26c, page 1

42
48
70
80
100

100
100
100

©
Form

1120-C

(2006)

Form 1120-C (2006)

Schedule E

Page

(a) Name of officer

(b) Social security number

(c) Percent of Percent of association’s
stock owned
time devoted
to business (d) Common (e) Preferred

1

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

2

Total compensation of officers

2

3

Compensation of officers claimed on Schedule A and elsewhere on return

3

4

Subtract line 3 from line 2. Enter the result here and on line 11, page 1

4

Schedule G

(f) Amount of
compensation

Allocation of Patronage and Nonpatronage Income and Deductions. Before completing,
see Question 14 of Schedule K.
(a) Patronage

1
2
3
4
5
6a
b
c
7

Gross receipts or sales
Cost of goods sold
Gross profit. Subtract line 2 from line 1
Other income
Total income. Add lines 3 and 4
Domestic production activities deduction (attach Form 8903)
Other deductions
Total deductions (add lines 6a and 6b)
Taxable income before section 1382, NOL, and special deductions.
Subtract line 6c from line 5
8 Deductions and adjustments under section 1382
9a Net operating loss deduction (attach schedule)
b Special deductions (see instructions)
10 Taxable income. Subtract the total of lines 8, 9a, and 9b from line 7
11 Unused patronage loss (see instructions)
12 Unused nonpatronage loss (see instructions)

Schedule H
1
2
3

(b) Nonpatronage

1
2
3
4
5
6a
6b
6c
7
8
9a
9b
10
11
12

Deductions and Adjustments Under Section 1382 (see instructions)

Dividends paid on capital stock (section 521 cooperatives only)

1
2

Nonpatronage income allocated to patrons (section 521 cooperatives only)
Patronage dividends:
a Money

3a

b Qualified written notices of allocation

3b

c Other property (except nonqualified written notices of allocation)
d Money or other property (except written notices of allocation) in redemption of nonqualified
written notices of allocation
4 Domestic production activities deduction allocated to patrons
5

3

Compensation of Officers (See instructions for line 11, page 1.)
Complete Schedule E only if total receipts (line 1a, plus lines 4 through 9, of page 1) are $500,000 or more.

Total. Combine lines 1 through 4. Enter here and on line 26a, page 1

3c
3d
4

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5
Form

1120-C

(2006)

Form 1120-C (2006)

Schedule J
1
2
3
4
5a
b
c
d
6
7
8

9

Page

Check if the cooperative is a member of a controlled group (attach Schedule O
©
(Form 1120))
Income tax (see instructions)
Alternative minimum tax (attach Form 4626)
Add lines 2 and 3
5a
Foreign tax credit (attach Form 1118)
5b
Qualified electric vehicle credit (attach Form 8834)
Form 3800
General business credit. Check applicable box(es):
5c
Form 6478
Form 8835, Section B
Form 8844
5d
Credit for prior year minimum tax (attach Form 8827)
Total credits. Add lines 5a through 5d
Subtract line 6 from line 4
Other taxes. Check if from:
Form 4255
Form 8611
Other (attach schedule)
Form 8902
Total tax. Add lines 7 and 8. Enter here and on line 28, page 1

Schedule K

9
Yes No

8

See the instructions and enter the:
Business activity code no. ©
Business activity ©
Product or service ©

3

Enter the date of incorporation

4

At the end of the tax year, did the cooperative own,
directly or indirectly, 50% or more of the voting
stock of a domestic corporation? (For rules of
attribution, see section 267(c).)
If “Yes,” attach a schedule showing: (a) name and
employer identification number (EIN), (b) percentage
owned, and (c) taxable income or (loss) before NOL
and special deductions of such corporation for the
tax year ending with or within your tax year.

7

6
7
8

Yes No

2
a
b
c

6

2
3
4

Other Information (see instructions)

1 Check accounting method:
a
Cash
b
Accrual
c
Other (specify) ©

5

4

Tax Computation (see instructions)

©

Is the cooperative a subsidiary in an affiliated group
or a parent-subsidiary controlled group?
If “Yes,” enter name and EIN of the parent
corporation ©
At the end of the tax year, did any individual,
partnership, corporation, estate, or trust own,
directly or indirectly, 50% or more of the
cooperative’s voting stock? (For rules of attribution,
see section 267(c).)
If “Yes,” attach a schedule showing name and
identifying number. (Do not include any information
already entered in 5 above.) Enter percentage
owned ©
Enter the cooperative’s total assets (see
instructions) © $

At any time during the tax year, did one foreign
person own, directly or indirectly, at least 25% of
(a) the total voting power of all classes of stock of
the cooperative entitled to vote or (b) the total value
of all classes of stock of the cooperative?
If “Yes,” enter: (a) Percentage owned ©
and (b) Owner’s country ©

c The cooperative may have to file Form 5472, Information
Return of a 25% Foreign-Owned U.S. Corporation or a
Foreign Corporation Engaged in a U.S. Trade or Business.
Enter number of Forms 5472 attached ©
9 Check this box if the cooperative issued publicly offered
©
debt instruments with original issue discount
If checked, the cooperative may have to file Form
8281, Information Return for Publicly Offered Original
Issue Discount Instruments.
10

Enter the amount of tax-exempt income received or
accrued during the tax year (for example, interest or
extraterritorial income) © $
11 Enter the number of patrons at the end of the tax
year (if 100 or fewer) ©
12

If the cooperative has an NOL for the tax year and is electing
©
to forego the carryback period, check here
If the cooperative is filing a consolidated return, the
statement required by Regulations section
1.1502-21(b)(3) must be attached or the election will
not be valid.

Enter the available NOL carryover from prior tax years
(Do not reduce it by any deduction on line 26b.)
Patronage © $
Nonpatronage © $
14 Are the cooperative’s total receipts (line 1a plus lines
4 through 9 on page 1) for the tax year and its total
assets at the end of the tax year less than $250,000?
13

If “Yes,” the cooperative is not required to complete
Schedules G, L, M-1, or M-2. Instead, enter the total
amount of cash distributions and the book value of
property distributions (other than cash) made during
the tax year. © $
Form

1120-C

(2006)

Form 1120-C (2006)

Page

Schedule L

Balance Sheets per Books

Beginning of tax year
(a)

Assets
1
2a
b
3
4
5
6
7
8a
b
9a
b
10
11a
b
12
13

Cash
Trade notes and accounts receivable
Less allowance for bad debts
Inventories
Other current assets (attach schedule)
Investments (see instructions)
Loans to shareholders
Mortgage and real estate loans
Buildings and other depreciable assets
Less accumulated depreciation
Depletable assets
Less accumulated depletion
Land (net of amortization)
Intangible assets (amortizable only)
Less accumulated amortization
Other assets (attach schedule)
Total assets

14
15
16
17
18
19
20

Accounts payable
Mortgages, notes, bonds payable in less than 1 year
Other current liabilities (attach schedule)
Loans from shareholders
Mortgages, notes, bonds payable in 1 year or more
Other liabilities (attach schedule)
Capital stock:
a Preferred stock
b Common stock
Additional paid-in capital
Patronage dividends allocated in noncash form
Per-unit retains allocated in noncash form
Retained earnings—Appropriated (attach schedule)
Retained earnings—Unappropriated
Adjustments to shareholders’ equity (attach schedule)
Less cost of treasury stock
Total liabilities and capital

5

End of tax year

(b)

(c)

(d)

(

)

(

)

(

)

(

)

(

)

(

)

(

)

(

)

Liabilities and Capital

21
22
23
24
25
26
27
28

Schedule M-1
1
2
3
4

(

Net income (loss) per books
Federal income tax per books
Excess of capital losses over capital gains
Income subject to tax not recorded on
books this year (itemize):

7

Income recorded on books this year
not included in this tax return (itemize):
Tax-exempt interest $

8

Deductions in this tax return not charged
against book income this year (itemize):
$
a Depreciation
b Charitable contributions $

Expenses recorded on books this year not
deducted in this return (itemize):
a Depreciation
$
b Charitable contributions $
c Travel and entertainment $
Add lines 1 through 5

Schedule M-2
1
2
3

4

(

)

Reconciliation of Income (Loss) per Books With Income per Return
Note: Schedule M-3 required instead of Schedule M-1 if total assets are $10 million or more—see instructions

5

6

)

9
10

Add lines 7 and 8
Income (line 25, page 1)—line 6 less line 9

Analysis of Unappropriated Retained Earnings per Books (Line 24, Schedule L)

Balance at beginning of year
Net income (loss) per books
Other increases (itemize):

Add lines 1, 2, and 3

5

6
7
8

Distributions: a Cash
b Stock
c Property
Other decreases (itemize):
Add lines 5 and 6
Balance at end of year (line 4 less line 7)
Form

1120-C

(2006)