8844 Instructions for Form 8844 Empowerment Zone and Renewal

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2018

Instructions for Form 8844

Department of the Treasury
Internal Revenue Service

Empowerment Zone Employment Credit

DRAFT AS OF
September 27, 2018
Section references are to the Internal Revenue Code
unless otherwise noted.

Future Developments

For the latest information about developments related to
Form 8844 and its instructions, such as legislation
enacted after they were published, go to IRS.gov/
Form8844.

What's New

The empowerment zone credit has expired for qualified
empowerment zone wages paid or incurred after 2017.

At the time these instructions went to print, the
total qualified empowerment zone wages paid or
CAUTION incurred during calendar year 2018, formerly
claimed on line 1 and line 2, had expired. You can't claim
a credit on line 1 and line 2 for qualified empowerment
zone wages paid or incurred during calendar year 2018.
Line 1 and line 2 are now shown as "Reserved for future
use" in case Congress extends the credit for 2018. To find
out if legislation extended the credit so you can claim
empowerment zone wages paid or incurred on your 2018
return, go to IRS.gov/FormsPubs or IRS.gov/Form8844.

!

General Instructions
Purpose of Form

Partnerships and S corporations must file this form to
claim the credit. All others are generally not required to
complete or file this form if their only source for this credit
is a partnership, S corporation, estate, trust, or
cooperative. Instead, they can report this credit directly on
Form 3800, General Business Credit. The following
exceptions apply.
You are an estate or trust and the source credit can be
allocated to beneficiaries. For more details, see the
instructions for Form 1041, Schedule K-1, box 13, code K.
You are a cooperative and the source credit can or
must be allocated to patrons. For more details, see the
instructions for Form 1120-C, Schedule J, line 5c.

Specific Instructions
Line 1 and Line 2

These lines are now shown as "Reserved for future use" in
case Congress extends the empowerment zone
employment credit for 2018. When any form, worksheet,
or instruction refers to these lines, treat the amounts on
these lines as zero.

Schedule K-1 (Form 1065), Partner’s Share of Income,
Deductions, Credits, etc., box 15 (code L);
Schedule K-1 (Form 1120S), Shareholder’s Share of
Income, Deductions, Credits, etc., box 13 (code L);
Schedule K-1 (Form 1041), Beneficiary’s Share of
Income, Deductions, Credits, etc., box 13 (code K); and
Form 1099-PATR, Taxable Distributions Received
From Cooperatives, box 10, or other notice of credit
allocation.

Partnerships and S corporations must report the above
credits on line 3. Also, estates and trusts that can allocate
the above credits to beneficiaries and cooperatives that
can allocate the above credits to patrons must report
these credits on line 3. All other filers figuring a separate
credit on earlier lines must report the above credits on
line 3. All others not using earlier lines to figure a separate
credit can report the above credits directly on Form 3800,
Part III, line 3.

Line 5
Cooperatives. A cooperative described in section
1381(a) must allocate to its patrons the credit in excess of
its tax liability limit. Therefore, to figure the unused amount
of the credit allocated to patrons, the cooperative must
first figure its tax liability. While any excess is allocated to
patrons, any credit recapture applies as if the cooperative
had claimed the entire credit.
If the cooperative is subject to the passive activity rules,
include on line 3 any empowerment zone and renewal
community employment credits from passive activities
disallowed for prior years and carried forward to this year.
Complete Form 8810, Corporate Passive Activity Loss
and Credit Limitations, to determine the allowed credit that
must be allocated between the cooperative and the
patrons. For details, see the Instructions for Form 8810.
Estates and trusts. Allocate the empowerment zone
employment credit on line 4 between the estate or trust
and the beneficiaries in the same proportion as income
was allocated and enter the beneficiaries' share on line 5.
If the estate or trust is subject to the passive activity rules,
include on line 3 any empowerment zone and renewal
community employment credits from passive activities
disallowed for prior years and carried forward to this year.
Complete Form 8582-CR, Passive Activity Credit
Limitations, to determine the allowed credit that must be
allocated between the estate or trust and the
beneficiaries. For details, see the Instructions for Form
8582-CR.

Line 3

Enter total empowerment zone employment credits from:

Aug 13, 2018

Cat. No. 66393K

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Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the
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 section 6103.

DRAFT AS OF
September 27, 2018
h

The time needed to complete and file this form will vary depending on individual circumstances. The estimated burden
for individual and business taxpayers filing this form is approved under OMB control number 1545-0074 and 1545-0123
and is included in the estimates shown in the instructions for their individual and business income tax return. The
estimated burden for all other taxpayers who file this form is shown below.
Recordkeeping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Learning about the law or the form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Preparing and sending the form to the IRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4 hr., 4 min.
2 hr., 22 min.
2 hr., 33 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.

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Instructions for Form 8844 (2018)