General Business Credit

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Instructions for Form 3800

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Instructions for Form 3800

Department of the Treasury
Internal Revenue Service

(Rev. June 2009)
General Business Credit
Section references are to the Internal
Revenue Code unless otherwise noted.

What’s New
For its first tax year ending after March
31, 2008, a corporation can elect to claim
a refundable credit for certain unused
research credits in lieu of the special
depreciation allowance for eligible
qualified property.
This election is extended (by the
American Recovery and Reinvestment
Tax Act of 2009 (Public Law 111-5)) for
one year to apply to property that is
generally placed in service in 2009
(extension property). Corporations may
also choose not to have this election
apply to extension property, or to make
this election only for extension property if
the election was not made in its first tax
year ending after March 31, 2008. See
the instructions for line 18b on page 2.
The following new credits are added to
line 1.
• Line 1t - Credits for affected
Midwestern disaster area employers
(Form 5884-A).
• Line 1v - Agricultural chemicals security
credit (Form 8931).
• Line 1w - Credit for employer
differential wage payments (Form 8932).
• Line 1x - Carbon dioxide sequestration
credit (Form 8933).
The following credits are removed from
line 1.
• The qualified railroad track
maintenance credit is extended and now
allowed to offset the alternative minimum
tax (AMT). It is removed from line 1l and
placed on new line 29g.
• The Hurricane Katrina housing credit
from pass-through entities can no longer
be claimed so it is removed from line 1u.
Part II is expanded to accommodate all
of the general business credits that are
allowed against alternative minimum tax.
Filers claiming a credit on line 24 or line
29 must complete Part II.

General Instructions
Who Must File
You must file Form 3800 to claim any of
the general business credits.
If your only source of credits listed on
Form 3800, Part I, is from pass-through
entities, you may not be required to
complete the source credit form. Instead,
you may be able to report the credit
directly on Form 3800. For more details,
see Part I. Current Year Credit on page 2.

Carryback and
Carryforward of Unused
Credit
If you cannot use part or all of the credit
because of the tax liability limit (line 32 is
less than the sum of lines 8, 24, and 30),
carry the unused credit back one tax year.
To carry back an unused credit, file an
amended return (Form 1040X, Amended
U.S. Individual Income Tax Return,
1120X, Amended U.S. Corporation
Income Tax Return, or other amended
return) for the prior tax year or an
application for tentative refund (Form
1045, Application for Tentative Refund, or
Form 1139, Corporation Application for
Tentative Refund). Generally, if you file
an application for a tentative refund, it
must be filed by the end of the tax year
following the tax year in which the credit
arose.
Note. No part of the unused credit for
any year attributable to any credit can be
carried back to any tax year before the
first tax year for which that credit was first
allowable. See Credit Ordering Rule
below to determine which credits are
allowed first.
If you have an unused credit after
carrying it back, carry it forward to each of
the 20 tax years after the year of the
credit. Any qualified business credits (as
defined in section 196(c)) that are unused
after the last tax year of the 20-year
carryforward period (or at the time an
individual taxpayer dies or other taxpayer,
such as a corporation or partnership,
ceases to exist) may be taken as a
deduction in the earlier of:
• The tax year following the last tax year
of the 20-year carryforward period or
• The tax year in which the individual
taxpayer dies or other taxpayer ceases to
exist.
Carryforward of the energy credit and
the renewable electricity credit. If a
grant is paid under Public Law 111-5,
section 1603, for investment in energy
property or renewable electricity property,
any carryforward of the energy credit or
renewable electricity credit related to that
property is reduced to recapture the
unused portion of the credit.

Change in Filing or Marital
Status
Your general business credit is limited to
your tax liability. Therefore, if you filed a
joint return in a carryback or carryforward
year and your marital status or filing
status has changed, you may need to
figure your separate tax liability in that
carryback or carryforward year. This
would apply if:
Cat. No. 10622Q

• You filed as single in the credit year,

but filed a joint return in the carryback or
carryforward year;
• You filed a joint return in the credit
year, but filed a joint return with a different
spouse in the carryback or carryforward
year; or
• You were married and filed a separate
return in the credit year, but filed a joint
return with the same or a different spouse
in the carryback or carryforward year.
Determine your separate tax liability in
the carryback or carryforward year as
follows.
1. Figure your tax for the carryback or
carryforward year as though you were
married filing a separate return.
2. Figure your spouse’s tax in that
year as though he or she was married
filing a separate return.
3. Add the amounts in steps 1 and 2.
4. Divide the amount in step 1 by the
amount in step 3. The result should be
rounded to at least three decimal places.
5. Multiply the decimal in step 4 by the
total tax shown on your joint return for the
carryback or carryforward year. The result
is your separate tax liability and a
carryback or carryforward credit is applied
against this amount only.
Although your carryback or
carryforward of the credit is limited to your
separate tax liability, the amount of your
refund resulting from the carryback or
carryforward is further limited to your
share of the joint overpayment. This is
found by subtracting your separate tax
liability (as determined above) from your
contribution toward the payment.
Unless you have an agreement or
clear evidence of each spouse’s
contribution toward the payment of the
joint liability, your contribution includes
the tax withheld on your wages and your
share of the joint estimated tax or tax paid
with the return. Your share of these
payments is found by using the same
formula used in determining your
separate tax liability. Substitute the joint
estimated tax, or tax paid with the return,
for the tax in step 5. If the original return
for the carryback year resulted in an
overpayment, reduce your contribution by
your share of the refund.
Attach a copy of the computation to
your amended return or application for
tentative refund.

Credit Ordering Rule
General business credits reported on
Form 3800 are treated as used on a
first-in, first-out basis by offsetting the
earliest-earned credits first. Therefore, the
order in which the credits are used in any
tax year is:
• Carryforwards to that year, the earliest
ones first,

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Instructions for Form 3800

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• The general business credit earned in

that year, and
• The carryback to that year.
When relevant, the components of the
general business credit reported on Form
3800 arising in a single tax year are used
in the following order.

Part I, line 1

• Investment credit (in the following

order — rehabilitation credit, energy
credit, qualifying advanced coal project
credit, and qualifying gasification project
credit).
• Welfare-to-work credit.
• Credit for increasing research activities.
• Low-income housing credit.
• Disabled access credit.
• Renewable electricity production credit.
• Indian employment credit.
• Orphan drug credit.
• New markets credit.
• Credit for small employer pension plan
startup costs.
• Credit for employer-provided child care
facilities and services.
• Biodiesel and renewable diesel fuels
credit.
• Low sulfur diesel fuel production credit.
• Distilled spirits credit.
• Nonconventional source fuel credit.
• Energy efficient home credit.
• Energy efficient appliance credit.
• Alternative motor vehicle credit.
• Alternative fuel vehicle refueling
property credit.
• Credits for affected Midwestern
Disaster Area employers.
• Mine rescue team training credit.
• Agricultural chemicals security credit.
• Credit for employer differential wage
payments.
• Carbon dioxide sequestration credit.
• Credit for contributions to selected
community development corporations.
• General credits from an electing large
partnership.

Part II, lines 24 and 29

• Empowerment zone and renewal
community employment credit.

• Investment credit (in the following order
- rehabilitation credit and energy credit).

• Work opportunity credit.
• Alcohol and cellulosic biofuel fuels

credit.
• Low income housing credit.
• Renewable electricity, refined coal,
and Indian coal production credit.
• Employer social security and Medicare
taxes paid on certain employee tips.
• Qualified railroad track maintenance
credit.
Although these credits are aggregated
on Form 3800, keep a separate record of
each credit to ensure proper accounting
of the credits.

Specific Instructions
Part I. Current Year Credit
Complete and attach the appropriate
credit forms used to figure your current
year credit. Generally, if you are a
taxpayer that is not a partnership or S
corporation, and your only source for a
credit listed in Part I of this form is from a

partnership, S corporation, estate, trust,
or cooperative, you are not required to
complete the source credit form or attach
it to Form 3800. The following exceptions
apply:
• You are claiming the investment credit
(Form 3468) or biodiesel and renewable
diesel fuels credit (Form 8864).
• The taxpayer is an estate or trust and
the source credit can be allocated to
beneficiaries. For more details, see the
Instructions for Form 1041, U.S. Income
Tax Return for Estates and Trusts,
Schedule K-1, box 13.
• The taxpayer is a cooperative and the
source credit can or must be allocated to
patrons. For more details, see the
Instructions for Form 1120-C, U.S.
Income Tax Return for Cooperative
Associations, Schedule J, line 5c.

Lines 1a and 29a
If you are a cooperative described in
section 1381(a), you must allocate to your
patrons the investment credit in excess of
your tax liability limit. Allocate to your
patrons the portion, if any, of the
investment credit on line 8 or line 30 in
excess of line 18a or line 28, respectively.
While any excess is allocated to patrons,
any credit recapture applies as if you as
the cooperative had claimed the entire
credit.

Line 1z
Enter the total of the amounts shown in
box 7 of the Schedules K-1 (Form
1065-B), Partner’s Share of Income
(Loss) From an Electing Large
Partnership, you received from electing
large partnerships (ELPs).

Line 3
Enter the credits included on line 2 that
are from passive activities. Generally, a
passive activity is a trade or business in
which you did not materially participate.
Generally, rental activities are passive
activities, whether or not you materially
participated. See Form 8582-CR, Passive
Activity Credit Limitations, or Form 8810,
Corporate Passive Activity Loss and
Credit Limitations, for details.

Line 5
Enter the passive activity credit allowed
from Form 8582-CR or Form 8810. See
the instructions for the applicable form for
details.

Line 6
Add all carryforwards to 2008 of unused
credits that are reported on Form 3800,
Part I. Also include any carryforward to
2008 of any unused credit from:
• Form 3468 for years prior to 2008.
• Form 5884 for years prior to 2007.
• Form 6478 for years prior to 2005.
• Form 8846 for years prior to 2007.
• Form 8900 for years prior to 2008.
For each credit, attach a detailed
computation showing: (a) the tax year the
credit originated, the amount of the credit,
and the amount allowed for that year; (b)
for each carryback year, the year and the
amount of the credit allowed after you
applied the carryback; and (c) for each
carryforward year, the year and the
amount of the credit allowed after you
applied the carryforward.

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Line 7
Use line 7 only when you amend your
2008 return to carry back unused credits
from 2009.

Part II. Allowable Credit
Line 15
See section 38(c)(5) for special rules that
apply to married couples filing separate
returns, controlled corporate groups,
regulated investment companies, real
estate investment trusts, and estates and
trusts.

Line 16
Although you may not owe AMT, you
generally must still compute the tentative
minimum tax (TMT) to figure your credit.
Enter zero on line 16 if:
• You are a small corporation exempt
from the AMT under section 55(e) or
• The only general business credit you
are claiming is on line 29.
Otherwise, complete and attach the
appropriate AMT form or schedule and
enter the TMT on line 16.

Line 18b
For its first tax year ending after March
31, 2008, a corporation can elect to
accelerate its use of unused research
credit carryforwards from tax years
beginning before 2006 and obtain a
refundable credit in lieu of the special
depreciation allowance on eligible
qualified property (see Eligible qualified
property below). If the election is made,
the corporation must do the following.
• Forego the special depreciation
allowance for eligible qualified property
acquired (including manufactured,
constructed, or produced) after March 31,
2008, and placed in service generally
before January 1, 2009, and
• Use the straight-line method of
depreciation on such property.
This election is extended for one year
to apply to property that is generally
placed in service in 2009. If you made an
election to increase the research credit or
minimum tax credit limitations for your
first tax year ending after March 31, 2008,
you can choose not to have the election
apply to certain extension property
(defined below). Otherwise, the original
election continues to apply to both eligible
qualified property and extension property.
However, in this case, separate bonus
depreciation amounts, maximum increase
amounts, and maximum amounts are
computed for eligible qualified property
and for extension property. If you did not
make the election for your first tax year
ending after March 31, 2008, you can
make the election only for extension
property for your first tax year ending after
December 31, 2008.
S corporations that make the election
to accelerate the credit can use the credit
only against the built-in gains tax. For S
corporations that file Form 1120-REIT,
see the instructions for Schedule D (Form
1120S), line 20. S corporations that file
Form 1120-REIT or Form 1120-RIC must
apply the credit first against the built-in
gains tax, if any, and reduce the
refundable credit by the amount so

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Instructions for Form 3800

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applied. See the instructions for line h of
the Built-in Gains Tax Worksheet in the
separate instructions for those forms.
Eligible qualified property.
Generally, eligible qualified property is:
• Qualified property under section
168(k)(2) that is acquired after March 31,
2008, and placed in service before
January 1, 2009, or
• Qualified property described in either
section 168(k)(2)(B) (long production
period property) or section 168(k)(2)(C)
(certain aircraft) that is placed in service
in 2009.

This does not include property acquired
pursuant to a written binding contract in
effect before April 1, 2008. See section
168(k)(4)(G)(iii) for special rules for
written binding contracts involving certain
passenger aircraft.
Extension property. Generally,
extension property is:
• Qualified property under section
168(k)(2) that is placed in service in 2009
and that is not property described in
section 168(k)(2)(B) or (C), and
• Qualified property described in sections
168(k)(2)(B) and (C), that is placed in
service in 2010.

Worksheet for Calculating the Refundable
Minimum Tax Credit and Research Credit
Amounts

Keep for Your
Records
(a)
Eligible
qualified
property

1. Enter depreciation (including the special depreciation
allowance) that would have been allowed for eligible
qualified property or extension property (as
appropriate) placed in service during the tax year if
section 168(k)(1) had applied to such property. . . . . .
2. Enter depreciation for eligible qualified property or
extension property (as appropriate) placed in service
during the tax year and figured without regard to
section 168(k)(1). . . . . . . . . . . . . . . . . . . . . . . . .
3. Subtract line 2 from line 1. . . . . . . . . . . . . . . . . . .
4. Multiply line 3 by 20%. . . . . . . . . . . . . . . . . . . . . .
5. Enter any unused research credit carryforward from
tax years beginning before 2006. . . . . . . . . . . . . . .
6. Enter any unused minimum tax credit carryforward
from tax years beginning before 2006. . . . . . . . . . .
7. Add line 5 and line 6. . . . . . . . . . . . . . . . . . . . . . .
8. Multiply line 7 by 6% . . . . . . . . . . . . . . . . . . . . . .
9. Enter the smaller of line 8 or $30,000,000. . . . . . . . .
10. Enter any bonus depreciation amounts determined
under section 168(k)(4)(C) attributable to eligible
qualified property (or extension property, as
appropriate) for all preceding tax years ending after
March 31, 2008. . . . . . . . . . . . . . . . . . . . . . . . . .
11. Subtract line 10 from line 9. If zero or less, enter -0-.
12. Bonus depreciation amount. Enter the smaller of line 4
or line 11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note: If you do not have a research credit
carryforward, or if you choose not to allocate bonus
depreciation amounts to research credit carryforwards,
skip lines 13 and 14 and enter -0- on line 15. . . . . . .
13. Enter the amount from line 10 allocated to the
research credit carryforward shown on line 5. . . . . . .
14. Maximum bonus depreciation amount allocable to the
research credit. Subtract line 13 from line 5. . . . . . . .
15. Refundable research credit. Enter the smaller of line
14 or the amount on line 12 that you choose to
allocate to the research credit. If you have a minimum
tax credit, continue to line 16. All others, enter the total
of line 15, columns (a) and (b), on your 2008 Form
3800, line 18b. . . . . . . . . . . . . . . . . . . . . . . . . . .
16. Subtract line 15 from line 12. . . . . . . . . . . . . . . . . .
17. Enter the amount from line 10 allocated to the
minimum tax credit carryforward shown on line 6. . . .
18. Maximum bonus depreciation amount allocable to the
minimum tax credit. Subtract line 17 from line 6. . . . .
19. Refundable minimum tax credit. Enter the smaller of
line 18 or line 16 in appropriate columns. Enter the
total of line 19, columns (a) and (b), on your 2008
Form 8827, line 7b. . . . . . . . . . . . . . . . . . . . . . . .

(b)
Extension
property

This does not include property acquired
pursuant to a written binding contract in
effect before April 1, 2008.
For corporations electing to accelerate
the use of unused research credit
carryforwards and obtain a refundable
credit in lieu of the special depreciation
allowance, figure the bonus depreciation
amount attributable to the research credit
by using the Worksheet for Calculating
the Refundable Minimum Tax Credit and
Research Credit Amounts below.
Separate worksheet computations must
be made for eligible qualified property and
for extension property. All others enter
zero on line 18b.
For more information on the election to
accelerate the research credit in lieu of
the special depreciation allowance, see
Rev. Proc. 2008-65, 2008-44 I.R.B. 1082,
available at http://www.irs.gov/irb/
2008-44_IRB/ar15.html, and Rev. Proc.
2009-16, 2009-6 I.R.B. 449, available at
http://www.irs.gov/irb/2009-06_IRB/ar10.
html. Also, for more information on the
special depreciation allowance, see the
Instructions for Form 4562, Depreciation
and Amortization, and Pub. 946, How To
Depreciate Property.

Lines 19a and 19b
Research credit limitation. If you are
an individual, the amount of the research
credit that may be included on lines 19a
and 19b is limited to the amount of tax
attributable to your taxable income from
the sole proprietorship or your interest in
the partnership, S corporation, estate, or
trust (pass-through entity) generating the
credit. Figure the research credit limitation
separately for each business enterprise
by using the following formula:

1.

2.
3.
4.
5.
6.
7.
8.
9.

Taxable income attributable to
the sole proprietorship or your
interest in the pass-through
entity
(Line 13 – line 15)

x
Your taxable income for the
year

The result figured above is limited to
the excess of line 13 over line 15. If in the
current tax year you had no taxable
income attributable to a particular
business interest, you cannot claim any
research credit this year related to that
business.
If your research credit is limited by the
above formula, refigure the amount to
enter on lines 19a and 19b using only the
total of the amount calculated above for
the research credit plus the general
business credit from other sources. If
necessary, follow the Credit Ordering
Rule (see page 1), and take into account
any passive activity credit limitations.
Write “Sec. 41(g)” on the dotted line next
to your entries on lines 19a and 19b.
Corporations. If the corporation has
undergone a post-1986 ownership
change (as defined in section 382(g)),
section 383 may limit the amount of tax
that may be offset by pre-change general
business credits. Also, if a corporation
acquires control of another corporation (or
acquires its assets in a reorganization),
section 384 may limit the amount of tax
attributable to recognized built-in gains
that may be offset by pre-acquisition

10.
11.
12.

13.
14.

15.
16.
17.
18.

19.

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Instructions for Form 3800

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general business credits. If either of these
limitations apply, attach a computation of
the allowable general business credit,
enter the amount on lines 19a and 19b,
and write “Sec. 383” or “Sec. 384” in the
margin next to your entries on lines 19a
and 19b.
Note. If the only credits you are claiming
are listed in Part I, enter the line 19b
amount on line 32 and skip lines 20
through 31.

Line 20
Form 8844 filers: multiply line 16 by 75%.
All others skip lines 20 through 24 and
enter zero on line 25.

Line 32
If line 32 is smaller than the sum of lines
8, 24, and 30, see Carryback and
Carryforward of Unused Credit on page 1.

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.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB
control number. Books or records relating
to a form or its instructions must be
retained as long as their contents may
become material in the administration of
any Internal Revenue law. Generally, tax
returns and return information are
confidential, as required by Internal
Revenue Code section 6103.
The time needed to complete and file
this form will vary depending on individual
circumstances. The estimated burden for
individual taxpayers filing this form is

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

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approved under OMB control number
1545-0074 and is included in the
estimates shown in the instructions for
their individual income tax return. The
estimated burden for all other taxpayers
who file this form is shown below.
Recordkeeping . . . . . . . . .

23 hr., 26 min.

Learning about the
law or the form . . . . . . . . . .

1 hr.

Preparing and sending
the form to the IRS . . . . . . .

1 hr., 25 min.

If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler,
we would be happy to hear from you. See
the instructions for the tax return with
which this form is filed.