Summary of Changes

IMPLEMENTATION PLAN for 1120PC INST
Run by User SD_GF2LB

December 17, 2007

P.L. 109-280, Pension Protection Act of 2006
Action
Number

Act
Section

IRC
Section

Covered in general terms to conform to the 1120 INST

Description of Action

Page 2 of 3

"What's New," and
page 11 of the
2007 Instructions

Date Type Effective Date Target Date Actual Date

66.00029

1202

170

Revise product to reflect that the modification of charitable deduction of
food inventory ended at the end of 2007.

A

31-DEC-2007 31-DEC-2007

66.00097

1204

170

Revise product to reflect that the modification of charitable deduction of
book inventory ended at the end of 2007.

A

31-DEC-2007 31-DEC-2007

P.L. 109-58, Energy Tax Incentives Act of 2005
Action
Number

Act
Section

IRC
Section

p. 12 of the 2007
Instructions

Description of Action

Extended to 2009.

Not relevant to
1120-PC

Date Type Effective Date Target Date Actual Date

66.00257

1331

179D

Revise product to reflect the termination of the energy efficient
commercial buildings deduction.

PPSA

31-DEC-2005 01-DEC-2007

66.00265

1332

45L

Revise product to reflect the termination of the energy efficient home
credit.

A

31-DEC-2005 31-DEC-2007

66.00278

1334

45M

Revise product to reflect the termination of the energy efficient
appliance credit for appliances manufactured after 2007.

A

31-DEC-2005 31-DEC-2007

66.00295

1342

30C

Revise product to reflect the termination of the alternative fuel vehicle
refueling property credit.

PPSA

31-DEC-2005 31-DEC-2014

66.00302

1344

40A

Revise product to reflect the termination of the biodiesel and
renewable diesel credit.

DOE

08-AUG-2005 01-DEC-2008

P. L. 108-218, Pension Funding Equity Act of 2004
Action
Number
66.00006

Act
Section
206

IRC
Section
501

Description of Action
Revise the instructions for Form 1120PC to reflect the transition rule in
effect until December 31, 2007 for certain small property and casualty
insurance companies for exemption from tax.

N/A for 2007
Date Type Effective Date Target Date Actual Date
TYBA

31-DEC-2007 31-DEC-2007

"What's New," in
2007 Instructions

P.L. 106-554, Community Renewal Tax Relief Act of 2000
Action
Number
66.00974

Act
Section
101(a)

IRC
Section
1400F

Description of Action
Revise the 2014 Form 1120PC instructions to reflect that gross
income does not include capital gain from the sale of qualified
community assets held more than five years and acquired after 2001
and before 2010

Date Type Effective Date Target Date Actual Date
A

03-DEC-2001 01-DEC-2014

N/A for 2007

IMPLEMENTATION PLAN for 1120PC INST
Run by User SD_GF2LB
Total Action Items: 9

December 17, 2007

Page 3 of 3

Major Changes to the 2007 Instructions for Form 1120-PC

Note: We made editorial changes throughout the instructions, updated the tax years and
added headings where needed.
Page 1
What’s New
We added text concerning the new Form 8925, Employer-Owned Life Insurance
Contract. Every policyholder of employer-owned life insurance contracts issued after
August 17, 2006, must file this form by attaching it to the appropriate business return.
(sec. 6039I)
We added text concerning the termination of the extraterritorial exclusion. The exclusion
does not apply to transactions that begin in 2007. (Act sec. 101 of the American Jobs
Creation Act of 2004 (P.L. 108-357); sec. 114 (repealed)).
We added text at the request of the LMSB team on reconciliation. Corporations that do
not file a Schedule M-3 (Form 1120-PC) must attach a schedule that reconciles the
NAIC Annual Statement to the Form 1120-PC. (LMSB)
We added text to clarify that the election to deduct GO Zone clean-up costs does not
apply to costs paid or incurred after December 31, 2007.
We added text to clarify that the special rules for the deduction of contributions of
“apparently wholesome food” and qualified book inventory do not apply to contributions
made after December 31, 2007.
We added text concerning the deadline for certain non-life insurance companies to
qualify for tax-exemption under section 501(c)(15) of the Internal Revenue Code.
Unresolved Tax Issues
We revised the first bullet to conform to the language used on the Taxpayer Advocate
Web site.
Page 2
General Instructions
Who Must File

Where to File. We revised the mailing addresses to include “Department of the Treasury”
on line 1, “Internal Revenue Service Center,” on line 2, for all addresses. The Post Office
address scanning machines require all addresses to consist of at least three lines.
Page 3
Statements
We inserted text at the request of LMSB to clarify that corporations that do not file a
Schedule M-3 (Form 1120-PC) with the Form 1120-PC must file a schedule that
reconciles the NAIC Annual Statement with the Form 1120-PC. (LMSB)
Page 5
Reportable transactions and material advisors. We revised the discussion regarding
reportable transactions. We also added information regarding new Form 8918, Material
Advisor Disclosure Statement. (Reg. sec. 301.6111-3)
Specific Instructions
Name and address. We adopted an employee suggestion to clarify that the address on
the return should be the corporation’s principal place of business or the address of the
principal office. We also inserted a note clarifying the use of the address for the
registered agent.
Item A. We revised the text concerning life-nonlife consolidated returns because a
separate checkbox for this type of mixed group on the Form 1120/Form 1120-PC was
added. (LMSB M-3 Team)
Schedule M-3. We revised the text in the second paragraph to conform to the text for the
checkbox on Form 1120-PC, Item A (page 1 of the return). (LMSB M-3 team).
Page 6
We revised text under Tax Computation and Payment related to Schedule O.
Page 7
Line 8b. We revised the text to incorporate both Form 5735 and Form 5884 in line with
Form 1120-PC.
Line 8c. General Business Credits. We revised the list of credits that are included on line
8c. Forms 5884 and 8846 were taken off the forms included on Form 3800 (Sec.
38(c)(4)(B)).

Line 10. Foreign Corporations. We corrected the reference to line 10 in the second
paragraph. It originally showed line 9 for the tax for foreign corporations.
Minimum effectively connected net investment income. We updated the domestic
asset/liability percentages and domestic investment yields needed to compute this
amount.
Page 8
Line 14i. We deleted references to the credit for telephone excise tax paid and
renumbered the remaining lines in sequence.
We also clarified that backup withholding amounts are to be entered to the left of the
dotted line of the entry space for line 14i.
Page 9
Line 13. Other income. We added proceeds from certain corporate owned life insurance
policies to the list of examples of other income (sec. 101(j)).
We rewrote the text for business start-up and organizational costs to remove references
to October 22, 2004.
Page 10
Line 18. We updated the table for the lease inclusion amount. (Rev. Proc. 2007-30,
2007-18 IRB 1104).
Page 11
Charitable contributions. We revised the text for contributions of cash and certain
easements.
Page 13
Line 36b. Net operating loss deduction. (second bullet) We deleted the word
“Temporary” and the letter “T” for the reference to Regulations section 1.382-11. (T.D.
9329)
Page 16
We updated the Instructions for the interest rates and loss payment patterns
and salvage discount factors for 2007. (Rev. Proc. 2008-10, Rev. Proc.
2008-11.)