Instructions For Form 1045 - Application For Tentative Refund

apply the carryback. Generally, an

years. See the instructions for line 10

preceding years can be carried

unused general business credit can

on this page to figure the tax years to

forward up to 20 years.

be carried back 1 year. Make the

which you can carry an NOL. Use the

Only the eligible loss portion of the

recomputation on Form 3800 (or

remaining pairs of columns for each

NOL can be carried back 3 years.

Form 8844, Form 6478, or Form

consecutive preceding tax year until

Example. You have a $20,000

8835, Section B, if applicable) for the

the loss is fully absorbed. Enter the

NOL of which only $5,000 is an

tax year of the tentative allowance.

ordinal number of years the loss is

eligible loss. The $5,000 eligible loss

being carried back and the date the

If you filed a joint return (or

is carried back 3 years, but the

carryback year ends in the spaces

separate return) for some but not all

remaining $15,000 loss is carried

provided in the headings above line

of the tax years involved in figuring

back only 2 years, although you had

10 for each pair of columns.

the unused credit carryback, special

modified taxable income of more than

rules apply to figuring the carryback.

Example. Your tax year is the

$5,000 in the 3rd preceding year.

See the instructions for Form 3800.

2007 calendar year and you are

Farming losses. To the extent the

carrying an NOL back 2 years. You

NOL is a farming loss (defined on

Line 1c—Net Section

enter “2nd” and “12/31/05” in the left

page 1), that part of the loss is

column heading in the spaces

1256 Contracts Loss

carried back to the 5th tax year

provided. The column heading now

before the loss. Any such loss not

An individual can elect to carry back a

reads “2nd preceding tax year ended

used in that year is carried to the 4th

net section 1256 contracts loss to

12/31/05.”

preceding year and then applied

each of the 3 tax years preceding the

For each carryback year, enter in

consecutively forward through the 1st

loss year. An estate or trust is not

the column labeled “Before

preceding year. Any such loss not

eligible to make this election. To

carryback” the amounts for the

applied in the 5 preceding years can

make the election, check box D at the

carryback year as shown on your

be carried forward up to 20 years.

top of Form 6781. The amount which

original or amended return. If the

Only the farming loss portion of the

can be used in any prior tax year

amounts were previously adjusted by

NOL can be carried back 5 years.

cannot exceed the net section 1256

you or the IRS, enter the amounts

contract gain in that year and cannot

Example. You operate a farming

after adjustment.

increase or create an NOL for that

business and incur an NOL of

year. Reflect the carryback as a

$50,000 for 2007. $25,000 of the

Line 10—NOL Deduction

reduction to your adjusted gross

NOL is attributable to income and

income in the “After carryback”

After Carryback

deductions of your farming business;

column on line 10. Attach to Form

$10,000 is attributable to a fire in your

Use the following rules to figure the

1045 a copy of Form 6781 and

personal residence (an eligible loss);

tax years to which you must carry an

Schedule D (Form 1040) for the year

and the remaining $15,000 is

NOL shown on Schedule A, line 25. If

of the net section 1256 contracts loss

attributable to your spouse’s work as

an NOL is not fully absorbed in a year

and an amended Form 6781 and an

an employee. The $25,000 farming

to which it is carried, complete

amended Schedule D (Form 1040)

loss is carried back 5 years; the

Schedule B to figure the amount to

for each carryback year. For more

$10,000 eligible loss is carried back 3

carry to the next carryback year.

details, see section 1212(c).

years; and the remaining $15,000

Note. You may need to use

loss is carried back 2 years. Any

Line 9

additional Forms 1045 to carry back

unused portion of this NOL can be

an NOL. Complete lines 1 through 9

carried forward up to 20 years.

If an NOL or net section 1256

and Schedule A on only one Form

contracts loss carryback eliminates or

You can make an irrevocable

1045. Use this Form 1045 for the

reduces a prior year foreign tax

election to figure the carryback period

earliest preceding tax years. You

credit, you cannot use Form 1045 to

for a farming loss without regard to

must sign this Form 1045, but do not

carry the released foreign tax credits

the special 5-year carryback rule. To

need to sign the other Forms 1045.

to earlier years. Also, if the released

make this election for 2007, attach to

foreign tax credits result in the

General rule. You generally must

your 2007 income tax return filed by

release of general business credits,

carry back the entire NOL to the 2nd

the due date (including extensions) a

you cannot use Form 1045 to carry

tax year before the loss year. Any

statement that you are electing to

the released general business credits

loss not used in the 2nd preceding

treat any 2007 farming losses without

to earlier years. Instead, you must file

year is then carried to the 1st

regard to the special 5-year carryback

Form 1040X or other amended return

preceding year. Any loss not applied

rule. If you filed your original return on

to claim refunds for those years. For

in the 2 preceding years can be

time, you can make the election on

details, see Rev. Rul. 82-154, 1982-2

carried forward up to 20 years. The

an amended return filed within 6

C.B. 394.

2-year carryback period does not

months after the due date of the

apply to the portion of an NOL

return (excluding extensions). Attach

Lines 10 Through 27—

attributable to an eligible loss, a

the election to the amended return,

farming loss, a qualified GO Zone

and write “Filed pursuant to section

Computation of

loss, or a specified liability loss.

301.9100-2” on the election

Decrease in Tax

statement. File the amended return at

Eligible losses. To the extent the

the same address you used for your

Use one pair of columns to enter

NOL is an eligible loss (defined on

original return. Once made, the

amounts before and after carryback

page 1), it is carried back to the 3rd

election is irrevocable.

for each year to which the loss is

tax year before the loss. Any loss not

being carried. Start with the earliest

used in that year is carried to the 2nd

Qualified GO Zone losses. To the

carryback year. A net section 1256

and then the 1st preceding year. Any

extent the NOL is a qualified GO

contracts loss can be carried back 3

such loss that is not applied in the 3

Zone loss (defined on page 1), that

-3-

Instructions For Form 1045 - Application For Tentative Refund - 2007 Page 3

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