Form 8827 Credit for Prior Year Minimum Tax - Corporations

Version A, Cycle 9

Form

8827

Credit for Prior Year Minimum Tax—Corporations

OMB No. 1545-1257

2008

(Rev. May 2009)

Department of the Treasury
Internal Revenue Service

©

Attach to the corporation’s tax return.

Employer identification number

Name

1
2
3
4
5

Alternative minimum tax (AMT) for 2007. Enter the amount from line 14 of the 2007 Form 4626
Minimum tax credit carryforward from 2007. Enter the amount from line 9 of the 2007 Form 8827
Enter any 2007 unallowed qualified electric vehicle credit (see instructions) . . . . . . .
Add lines 1, 2, and 3 . . . . . . . . . . . . . . . . . . . . . . . . .
Enter the corporation’s 2008 regular income tax liability minus allowable tax credits (see
instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1
2
3
4
5

6

Is the corporation a “small corporation” exempt from the AMT for 2008 (see instructions)?
● Yes. Enter 25% of the excess of line 5 over $25,000. If line 5 is $25,000 or less, enter -0● No. Complete Form 4626 for 2008 and enter the tentative minimum tax from line 12
. . .
7a Subtract line 6 from line 5. If zero or less, enter -0- . . . . . . . . . . . . . . .
b For a corporation electing to accelerate the minimum tax credit, enter the bonus depreciation
amount attributable to the minimum tax credit (see instructions) . . . . . . . . . . .
c
8a

Add lines 7a and 7b . . . . . . . . . . . . . . . . . . . . . . . . .
Enter the smaller of line 4 or line 7c. If the corporation had a post-1986 ownership change or
has pre-acquisition excess credits, see instructions . . . . . . . . . . . . . . .

b Current year minimum tax credit. Enter the smaller of line 4 or line 7a here and on Form 1120,
Schedule J, line 5d (or the applicable line of your return). If you made an entry on line 7b, go to
line 8c. Otherwise, skip line 8c . . . . . . . . . . . . . . . . . . . . . .
c

9

Subtract line 8b from line 8a. This is the refundable amount for a corporation electing to
accelerate the minimum tax credit. Include this amount on line 32g of Form 1120 (or the
applicable line of your return) . . . . . . . . . . . . . . . . . . . . . .
Minimum tax credit carryforward to 2009. Subtract line 8a from line 4. Keep a record of this
amount to carry forward and use in future years . . . . . . . . . . . . . . . .

Instructions

DRAFT AS OF
May 21, 2009

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 minimum tax credits in
lieu of the special depreciation allowance for
eligible qualified property. For its first tax year
ending after December 31, 2008, a corporation
can choose to have this election apply to
extension property (defined later), can choose
not to have this election apply to extension
property, or can choose 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 7b below.

Purpose of Form
Corporations use Form 8827 to figure the
minimum tax credit, if any, for AMT incurred in
prior tax years and to figure any minimum tax
credit carryforward.

Who Should File
Form 8827 should be filed by corporations
that had:
● An AMT liability in 2007,
● A minimum tax credit carryforward from

2007 to 2008, or

● A qualified electric vehicle credit not allowed

for 2007 (see the instructions for line 3).

Line 3

Enter any qualified electric vehicle credit not
allowed for 2007 solely because of the
tentative minimum tax limitations under
section 30(b)(3)(B).

Line 5

Enter the corporation’s 2008 regular income
tax liability (as defined in section 26(b)) minus
any credits allowed under Chapter 1,
Subchapter A, Part IV, subparts B, D, E, and F
of the Internal Revenue Code (for example, if
you are filing Form 1120, subtract any credits
on Schedule J, lines 5a through 5c, from the
amount on Schedule J, line 2).

Line 6
See the 2008 Instructions for Form 4626 to
find out if the corporation is treated as a
“small corporation” exempt from the AMT for
2008. If the corporation is a “small
corporation” exempt from the AMT, see
section 38(c)(5) before completing line 6 for
special rules that apply to controlled
corporate groups, regulated investment
companies, and real estate investment trusts.

Line 7b
For its first tax year ending after March 31,
2008, a corporation can elect to accelerate its
use of unused minimum tax credit
carryforwards from tax years beginning before
2006 and obtain a refundable credit in lieu of
the special depreciation allowance on eligible
qualified property (defined below). If the
election is made, the corporation must do the
following.
Cat. No. 13008K

6
7a
7b
7c
8a

8b

8c
9

● 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

of such property.

This election is extended for one year to
apply to property that is generally placed in
service in 2009. If the corporation made an
election to increase the research credit or
minimum tax credit limitations for its first tax
year ending after March 31, 2008, the
corporation can choose not to have the
election apply to extension property (defined
below). Otherwise, the original election
continues to apply to both eligible qualified
property and extension property. In this case,
separate bonus depreciation amounts,
maximum increase amounts, and maximum
amounts must be computed for eligible
qualified property and for extension property.
Note. If the corporation did not make the
election for its first tax year ending after
March 31, 2008, it can make the election only
for extension property for its first tax year
ending after December 31, 2008.
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, and long

Form 8827 (Rev. 5-2009)

Version A, Cycle 9
Page 2

Form 8827 (Rev. 5-2009)

Worksheet for Calculating the Refundable Minimum Tax Credit Amount (keep for your records)
1

2

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 . . . . .
Enter depreciation for eligible qualified property) or extension property), as appropriate,
placed in service during the tax year figured without regard to section 168(k)(1)

3
4
5
6
7
8
9
10

Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . .
Multiply line 3 by 20%
. . . . . . . . . . . . . . . . . . . .
Enter any unused research credit carryforward from tax years beginning before 2006
Enter any unused minimum tax credit carryforward from tax years beginning before 2006
Add line 5 and line 6 . . . . . . . . . . . . . . . . . . . . .
Multiply line 7 by 6% . . . . . . . . . . . . . . . . . . . . .
Enter the smaller of line 8 or $30,000,000 . . . . . . . . . . . . . .
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
12

Subtract line 10 from line 9. If zero or less, enter -0- . . . . . . . . . . .
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
14
15

Enter the amount from line 10 allocated to the research credit carryforward shown on line 5
Maximum bonus depreciation amount allocable to the research credit. Subtract line 13 from line 5
Refundable research credit. Enter the smaller of line 14 or the amount on line 12
that you choose to allocate to the research credit . . . . . . . . . . .

16
17
18

Subtract line 15 from line 12
. . . . . . . . . . . . . . . . . .
Enter the amount from line 10 allocated to the minimum tax credit carryforward shown on line 6
Maximum bonus depreciation amount allocable to the minimum tax credit. Subtract
line 17 from line 6 . . . . . . . . . . . . . . . . . . . . . .
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 Form 8827, line 7b . .

19

(a)
Eligible qualified
property

(b)
Extension
property

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2
3
4
5
6
7
8
9

10
11
12

13
14

DRAFT AS OF
May 21, 2009

production period property described in
section 168(k)(2)(B), or certain aircraft
described in section 168(k)(2)(C), that is
placed in service in 2009. If a binding contract
to acquire the property existed before April 1,
2008, the property does not qualify. See
section 168(k)(4)(G)(iii) for special rules for
written binding contracts involving certain
passenger aircraft.
Generally, extension property is: (1) 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 (2)
property described in sections 168(k)(2)(B) and
(C), that is placed in service in 2010. If a binding
contract to acquire the property existed before
April 1, 2008, the property does not qualify.
If the corporation elects to accelerate the
minimum tax credit and obtain a refundable
credit in lieu of the special depreciation
allowance, complete the Worksheet for
Calculating the Refundable Minimum Tax Credit
Amount on page 2. Enter the total of line 19,
columns (a) and (b), of the worksheet on line 7b.
All others, enter zero on line 7b.
For more information on the election to
accelerate the research or minimum tax credit in
lieu of claiming 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, 2009-06 I.R.B. 449, available at http://
www.irs.gov/pub/irs-irbs/irb09-06.pdf.

For more information on the special
depreciation allowance, see the Instructions for
Form 4562 and Pub. 946, How To Depreciate
Property.

S corporations that make the election to
accelerate the credit can use the credit only
against the built-in gains tax. 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 applied. See the instructions for line h of
the Built-in Gains Tax Worksheet in the
separate instructions for those forms.

Line 8
If the corporation had a post-1986 ownership
change (as defined in section 382(g)), there may
be a limit on the amount of pre-change minimum
tax credits that can be applied against the
corporation’s tax for any tax year ending after
the ownership change. See section 383 and the
related regulations. To figure the amount of the
pre-change credit, the corporation must allocate
the credit for the change year between the prechange period and the post-change period. The
corporation must use the same method of
allocation (ratable allocation or closing-of-thebooks) for purposes of sections 382 and 383.
See Regulations section 1.382-6 for details.
Also, there may be a limit on the use of preacquisition excess credits of one corporation to
offset the tax attributable to recognized built-in
gains of another corporation. See section 384
for details.

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18
19

If either limit applies, attach a computation of
the minimum tax credit allowed. Enter that
amount on line 8a. Write “Sec. 383” or “Sec.
384” on the dotted line to the left of the line
8a entry space.
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