Summary of Changes

IRS - OMB REVIEW REQUEST FORM
Request for OMB review of currently approved document:
Date:

Name: Emile

11/16/2011

R. Beausejour

Office Symbols: SE:W:CAR:MP:T:B:P
Phone Number:

(202) 622-8003

Summary of Changes
The following summary concerns 2011 Form 1120-C.
Beginning with tax year 2011, Schedule A previously found at the top of page 2 has been deleted. This schedule has
been replaced with the stand alone Form 1125-A, Cost of Goods Sold. Also Schedule E previously found on page 3
has been deleted. This schedule has be replaced with the stand alone Form 1125-E, Compensation of Officers. These
new forms will be shared by many 1120 series in the future. Due to these deletions, lines 2, 11, and 18 were updated
on page 1. These changes could possibly affect filers as follows: Filing new Form 1125-A: 500,000 (estimated as
actual number is unknown); Filing new Form 1125-E: 150,000 (estimated as actual number is unknown).
Also on page 1, we revised and reformatted old lines 25, 26a, 26b, 26c, and 26d into new lines 25a, 25b, 25c, 26a,
26b, and 26c. These changes are based on comments we received from the National Council of Farmer Cooperatives
where they noted that the patronage deduction should precede the net operating loss deduction as discussed in
Revenue Ruling 65-106, 1965-1 C.B. 126. We revised these sections accordingly. Due to these changes, line 27 on
page 1; Schedule C, line 20, on page 2; Schedule H, line 5, on page 3; Schedule K, line 13, on page 4; and, Schedule
M-2, line 10, on page 5 were revised to reflect new line references. These changes could possibly affect 400,000 filers
(estimated as actual number is unknown) as filers would need to read the instructions to complete these redesigned
lines.
Due to the redesign of 2011 Form 3800, the line reference to Form 3800 on line 29g on page 1 was revised. This
change will have no real affect on filers other than identifying the new line number.
Due to line changes on 2011 Form 8834, the line reference to Form 8834 on Schedule J, line 5b, on page 4 was
revised. This change will have no real affect on filers other than identifying the new line number.

Impact on Approved Collection
Public
Law No.

Regulation
No.

Other

Change In IRS Form
& Instructions
No. of Filers
Words

Code
References
SAMPLE:
PL 109-567

REG-345675-08

RP 2009-134

+/- 5

+/- 20,000

+/- 500

Attachments

+/- 1

IRC 6651(a)(2) + 1,000
IRC 301(c) & 312 + 1,000

IRC 108(i), et. al. - 3,000

-1

IRC 195(b)(3) -100
1.195-1T / 1.195-1

1.248-1T / 1.248-1

0
0

*Please insert how this new (PL, REG, or other), document will affect the currently approved collection.
Impact on Approved Collection table continued on page 5.

IRS - OMB REVIEW REQUEST FORM
Request for OMB review of currently approved document:
Date:

Name:

11/16/2011

(Continued)

Emile R. Beausejour

Office Symbols: SE:W:CAR:MP:T:B:P
Phone Number:

(202) 622-8003

Additional Information:
New line 5e and entry line was added in Schedule J on page 4 for bond credits from Form 8912. We added this line
based on comments from the National Council of Farmer Cooperatives to be more consistent with Form 1120. In the
past, cooperatives were writing this credit in. This change will have no real affect on filers other than identifying there is
no longer a write-in on Form 1120-C, Schedule J, but actually a new line entry. There may be about 15 filers affected
(estimated as actual number is unknown).

The following summary concerns 2011 Instructions for Form 1120-C.
All references made to page numbers within the instructions have been replaced with location indicators such as
"earlier" or "later." This change was directed by new TF&P procedures and will affect all filers and may increase times
for paper filers as page numbers are no longer in use.
We deleted the "Contents" listing as directed by TF&P Senior Technical Advisor as part of the transition between
software programs. This change will affect all filers and may increase times for paper filers as page numbers are no
longer in use.
Under the heading "What's New," we revised the first bulleted item to reflect changes to how federal tax deposits can
be made beginning January 1, 2011. The remaining three bulleted items were deleted as they were no longer pertinent
for tax year 2011. We added seven new items where the three items discuss new forms; Form 8822-B, Change of
Address - Business; Form 1125-A, Cost of Goods Sold; and Form 1125-E, Compensation of Officers. Another item
discusses the change in timing of when a taxpayer sending the reasonable cause statement should be sent to the
Service for a request for abatement of penalties. Another item notes changes to certain charitable contributions due to
the termination of Code sections 170(e)(3)(C)(iv) and 170(e)(3)(D)(iv). The next item notes changes to certain other
deductions due to the termination of Code sections 181(f) and 198(h). The final section is a new permanent section
titled "Future developments." This section notes any future developments affecting Form 1120-C and its instructions
will be found on specific web page on IRS.gov. There are no real number of filers affected as these items are just
articles identifying the changes made and any estimations will be noted in the appropriate area of the affect
instructions.
On page 4, under section title "Late filing of return," we replaced the last sentence with three new sentences
concerning the timing of submission of reasonable cause statement at the request of the Director, Submission
Processing. It is estimated that this change to affect 10,000 filers. We added a new last sentence under "Late payment
of tax" referring the reader to Code section 6651(a)(2) for clarification purposes. This change has minimal affect on
filers as most filers should know of this Code section already, but we estimate it may be new for 1,000 filers. We
expanded the last sentence in the second paragraph under "Recordkeeping" to provide the reader with clarification
why to keep copies of returns which includes references to Code sections 301(c) and 312. This change has minimal
affect on filers as most filers should know of this Code section already, but we estimate it may be new for 1,000 filers.
On page 7 in the "Note" paragraph under "Item D. Initial Return, Final Return, Name Change, Address Change, or
Amended Return, we updated the change of address form to now show the new change of address form for
businesses - Form 8822-B. This is an information change informing filers of a new form that could be used after filing
the Form 1120-C where the filing of Form 8822 was previously used and should have no affect on filers of Form
1120-C for 2011. Under "Line 2. Cost of Goods Sold," we combined the last two sentences and revised them to
identify new Form 1125-A which took the place of Form 1120-C, Schedule A. We noted the estimated number of filers
affected by needing the use the new Form1125-A earlier.

2

IRS - OMB REVIEW REQUEST FORM
Request for OMB review of currently approved document:
Date:

Name:

11/16/2011

(Continued)

Emile R. Beausejour

Office Symbols: SE:W:CAR:MP:T:B:P
Phone Number:

(202) 622-8003

Additional Information:
Beginning with the last bullet item under "Other" on page 8, we retained the first sentence, but deleted the remaining
two sentences, the two numbered items, and the succeeding paragraph. These deletions applied to the reacquisition
of an applicable debit instrument after 12/31/2008 and before 1/1/2011 which are part of some provisions of Code
section 108(i) which have expired. As this is an expired provision with a very specific audience, we estimate the
change reduced the burden for approximately 3,000 filers
On page 9, in the last bullet item under the first paragraph under "Exceptions," we revised the text to reflect the
Instructions for Form 1125-A which replaced the instructions for "Costs of Goods Sold" which was previously located in
the Instructions for Form 1120-C (the estimation of changes to filers for this issue were noted earlier). We deleted
subsection "Special rule for 2010 start-up costs" under "Business start-up and organization costs" as Code section 195
(b)(3) expired after 2010. We estimate minimal reduction in filers (less than 100) as the costs are inherent to any
cooperative starting up in 2011 and they will still be able to take advantage of this deduction, just at a lesser overall
amount. In the last sentence in the first paragraph under "Time for making an election," we revised the text to reflect
the the regulations which were previously temporary to permanent by TD 9542 (we do not estimate any change in
number of filers as the regulations were made permanent. In the first sentence in the first paragraph under "Note," we
changed the word "clearly" to "affirmatively" per TD 9542 which revised Regulations sections 1.195-1(b) and 1.248-1
(c) (we do not estimate any changes in filers).
In the second paragraph under "Line 11. Compensation of Officers" on page 10, we revised the text to reflect the
change from Schedule E to new Form 1125-E.
On page 11, we updated the first row in the table to include January 1, 2012, per Revenue Procedure 2011-21,
Table 5 (we estimate 1,500 filers may take advantage of this change). Also, we revised the last sentence in the last
bullet item under "Special rules" for clarification purposes (this change will not affect any filers).
On page 12, we deleted the CAUTION icon paragraph concerning contributions to earthquake victims in Haiti that
appeared after the second paragraph under "Line 17. Charitable Contributions" as this provision has expired (P.L.
111-126) (we estimate a reduction in 1,500 filers for this deduction). Also on this page under "Other special rules," in
the first bullet item in the second paragraph, we added the phrase "made before January 1, 2012" twice as the
provisions for certain contributions of inventory and other property to certain organizations for use in the care of the ill,
needy, or infants and contributions of qualified book inventory to public schools expire after 2011 per Code sections
170(e)(3)(C)(iv) and 170(e)(3)(D)(iv) (we estimate a reduction in filers will not occur primarily until tax year 2012).
Finally, under "Line 18. Depreciation," we revised the text from "Schedule A" to "Form 1125-A" to reflect the new form
which replaced the old Form 1120-C, Schedule A.
Under "Examples of other deductions include the following" on page 13, in the second bullet item concerning certain
costs of qualified film or television productions, we revised the text to include the phrase "starting before January 1,
2012" as this provision expires after 2011 per Code section 181(f), we added reference to Regulations sections
1.181-1 through 1.181-6 per TD 9551, and added reference to Temporary Regulations section 1.181-6T per TD 9552.
We estimate no reduction in filers until tax year 2012, however, the additional regulations may affect 1,200 filers. We
revised the fourth bullet item concerning certain environmental remediation costs by adding the phrase "paid or
incurred before January 1, 2012" as this provision expires per Code section 198(h). We estimate no reduction in filer
until 2012.

23

IRS - OMB REVIEW REQUEST FORM
Request for OMB review of currently approved document:
Date:

Name:

11/16/2011

(Continued)

Emile R. Beausejour

Office Symbols: SE:W:CAR:MP:T:B:P
Phone Number:

(202) 622-8003

Additional Information:
On pages 14 and 15, from section title beginning with "Line 25" to "Line 26d," we revised the titles and text to reflect
new line numbers due to comments we received from the National Council of Farmer Cooperatives where they noted
that the patronage deduction should precede the net operating loss deduction as discussed in Revenue Ruling 65-106,
1965-1 C.B. 126. We revised these sections accordingly. We estimate these changes could affect 350,000 filers.
On page 16, in the sentence second under "Line 29g. Refundable Credits From Forms 3800 and 8827," we revised
the reference to Form 3800 to reflect changes made to 2011 Form 3800 due to revisions made based on Public Law
(P.L.) 111-240, sections 2012 and 2013 (we estimate. We also deleted the entire section "Schedule A. Cost of Goods
Sold" and all subsections as this section is replaced by new Form 1125-A. As noted earlier, we estimate this change
will affect 500,000 filers.
On page 18, in the second sentence under :Line 13, Column (a)," we revised the title to Form 8621. This change will
not affect any filers.
On page 20, we deleted the section "Alternative tax on qualified timber gain" that previously appeared below the
"Tax Rate Schedule" as the provision provided under P.L. 110-246, section 15311, has expired (we estimate this
change reduces the number of filers by 1,500). In the first sentence under "Line 5b. Qualified Electric Vehicle Credit,"
the line reference to Form 8834 has been revised (we see minimal affect to filers with this change). In the fourth
sentence of the second paragraph (on page 21) under "Line 5c. General Business Credit," the line reference to Form
3800 has been revised (we see minimal affect to filers with this change).
On page 21, under "Required allocations to patrons of subchapter T cooperatives, we moved the old second bullet
item for Form 8845 to now be the new third bullet item to make list appear in numerical order and we also added new
fifth bullet item for Form 8932 (we see minimal affect to filers with this change). We also added new section "Line 5e.
Bond Credits." This section was added based on comments from National Council of Farmer Cooperatives to be
consistent with Form 1120. There may be about 15 filers affected (estimated as actual number is unknown).

24

Impact on Approved Collection
(continued)
Public
Law No.

Regulation
No.

Other

Change In IRS Form
& Instructions
No. of Filers
Words

Code
References
SAMPLE:
PL 109-567

REG-345675-08

RP 2009-134

+/- 5

+/- 20,000

+/- 500

Attachments
+/- 1

+ 1,500

RP 2011-21

PL 111-126

- 1,500
IRC 170(e)(3)(C)(iv)

0

IRC 170(e)(3)(D)(iv)

0
0
+ 1,200

IRC 181(f)
Reg. 1.181-1 to
1.181-6 & 1.181-6T

IRC 198(h) 0
RR 65-106

+ 350,000

+ 500,000
New Form 1125-E
+ 150,000
IRC 1201(b) - 1,500
New Form 1125-A*

PL 111-246,
section 15311

With the requirement to complete new Form 1125-A, the following citations were removed from the instructions for Form
1120 when Schedule A were removed.
- Regulations section 1.471-1.
- IRC 448(d)(3).
- IRC 481(a).
- IRC 1383.
- IRC 263A.
- Regulations section 1.263A-2(b).
- Regulations section 1,263A-3(d).
- Regulations sections 1.263A-1 through 1.263A-3.
- RP 2008-43.
- RP 2008-52.
- Regulations section 1.471-2(c).
- IRC 472.
- IRC 472(d).
.