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IRS Form 1138: Fill it in the Right Way

Margarete Cotty

2024-04-18 11:56:27 • Filed to: Other IRS Forms • Proven solutions

A corporation that expects a net operating loss in the current tax year will be expected to fill IRS Form 1138-Extension of Time for payment of Taxes by a Corporation Expecting a Net Operating Loss Carryback.

Your Best Solution to Fill out IRS Form 1138

IRS Form 1138 is a PDF form and like all PDF forms, it will require a form filler to fill it out faster and easily. Although you could fill it out through other means but note that the best form filler applicationis Wondershare PDFelement - PDF Editor.

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Instructions for How to Complete IRS Form 1138

Completing IRS Form 1138 is easy and simple especially when using PDFelement platform. Below is a step by step guide that will help in the form filling process.

Step 1: Get your IRS Form 1138 from the official website of the internal revenue Service of the department of Treasury. Once this is done, open it using PDFelement and start the form filling process.

Step 2: Write your name and the employer identification number on the spaces provided. Write your address. But note that your address should contain the number, street, room or suite, city or town, state and zip code. If you are using a P.O box, then see further instructions.

Step 3: On line 1, you are expected to enter the ending date of the tax year of the expected net operating loss.

Step 4: Go to line 2, enter the amount of the expected net operating loss. But note that the amount of the expected net operating loss must be based on all of the facts that is relating to the operation of the corporation. You should consider the number and dollar amounts of the corporation’s government contracts that have been cancelled, the profit and loss statement, and other factors that are peculiar to the corporations operations when estimating the amount of the expected net operating loss, NOL.

Step 5: Enter the reduction of the previously determined tax attributable to the expected net operating loss carryback on line 3. However, note that the previously determined tax is the amount shown on the return and any amount assessed as deficiencies before IRS Form 1138 is filled minus any credits, abatements, refunds made or allowed before Form 1138 is filled.

Step 6: On line 4, enter the ending date of the tax year immediately preceding the tax year of the expected net operating loss and give the reasons, facts and circumstances that cause the corporation to expect a net operating loss on line 5.

Step 7: For the year that is written on line 4, enter the total of the total tax shown on the return plus the amount that is accessed as deficiencies on line 6a while on line 6b, you are expected to enter the amount of tax paid or that will be required to be paid before the form is filled. Note that this will include any amount that is accessed as deficiency. Also enter the amount of credits, refund and abatement made before the form is filled. Subtract line 6b form 6a and enter the amount on line 6c. Note that this is the amount of tax for which the time for payment is extended.

Step 8: Complete the form by signing, putting the date and title on the form and keep the copy of the form for your records.

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Tips and Warnings for IRS Form 1138

It is important to note that the IRS can terminate the extension if it believes that the form contains some erroneous or some unreasonable information. Therefore, ensure that all information entered on this form is clear and correct to the best of your knowledge.
Note that if your address is outside the United States, you will have to follow the foreign country’s practice for entering the postal code if applicable but do not abbreviate the country’s name.
The extension for paying the tax will expire at the end of the month in which the return for the tax year of the expected net operating loss is required to be filled including the extensions.
You are expected to file IRS Form 1138 after the start of the tax year of the expected net operating loss but before the tax of the preceding tax year is required to be paid.
Where to file IRS Form 1138 is the Internal Revenue Service Center where the corporation normally files its income tax return. Do not file it elsewhere.