Section references are to the Internal Revenue Code unless otherwise noted.
The following general business credits were removed from line 1:
Line 1u has been designated for the Hurricane Katrina housing credit from pass-through entities.
You must file Form 3800 to claim any of the general business credits listed on lines 1a through 1x. Five of the general business credits have special tax liability limits and are not reported on Form 3800. These are:
If your only source of credits listed on Form 3800 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.
If you cannot use part or all of the credit because of the tax liability limit (line 19 is less than line 8), carry the unused credit back one tax year. To carry back an unused credit, file an amended return (Form 1040X, 1120X, 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 shall be carried back to any tax year before the first tax year for which that credit was first allowable. See Credit Ordering Rule on page 2 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:
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:
Determine your separate tax liability in the carryback or carryforward year as follows.
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.
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:
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.
Although these credits are aggregated on Form 3800, keep a separate record of each credit to ensure that no credits or deductions are squandered or duplicated.
Complete and attach the appropriate credit forms 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 on 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:
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 in excess of line 18. While any excess is allocated to patrons, any credit recapture applies as if you as the cooperative had claimed the entire credit.
Complete this line only if you received a credit on a 2006 Schedule K-1 from an S corporation, partnership, estate, or cooperative that had a fiscal year beginning before July 1, 2006.
Enter the total of the amounts shown in box 7 of the Schedules K-1 (Form 1065-B), you received from electing large partnerships (ELPs).
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.
Enter the passive activity credit allowed from Form 8582-CR or Form 8810. See the instructions for the applicable form for details.
Add all carryforwards to 2007 of unused credits that are reported on Form 3800. Also include any carryforward to 2007 of any unused credit from:
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.
Use line 7 only when you amend your 2007 return to carry back unused credits from 2008.
If this line is zero, skip Part II.
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.
Although you may not owe AMT, you generally must still compute the tentative minimum tax (TMT) to figure your credit. For a small corporation exempt from the AMT under section 55(e), enter zero. Otherwise, complete and attach the appropriate AMT form or schedule and enter the TMT on line 16.
If line 19 is smaller than line 8, see Carryback and Carryforward of Unused Credit on page 1.
Research credit limitation. If you are an individual, the amount of the research credit that may be included on line 19 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:
Taxable income attributable to
the sole proprietorship or your
interest in the pass-through
entity
(Line 13 - line 15) × -------------------------------
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 line 19 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, and take into account any passive activity credit limitations. Write "Sec. 41(g)" on the dotted line next to your entry on line 19.
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 general business credits. If either of these limitations apply, attach a computation of the allowable general business credit, enter the amount on line 19, and write "Sec. 383" or "Sec. 384" in the margin next to your entry on line 19.
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.
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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 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 17 hr., 56 min. Learning about the law or the form 1 hr., 23 min. Preparing and sending the form to the IRS 1 hr., 42 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.