Instructions for Form 3800 - Introductory Material Future Developments What’s New 2023 Form 3800. New item A. Part I. Current Year Credit for Credits Not Allowed Against Tentative Minimum Tax (TMT). Part II. Allowable Credit. Part III. Current Year General Business Credits. New Part IV. Carryovers of General Business Credits or Eligible Small Business Credits (ESBCs). New Part V. Breakdown of Aggregate Amounts on Part III for Facility-by-Facility, Multiple Pass-Through Entities. New Part VI. Breakdown of Aggregate Amounts in Part IV. New military spouse retirement plan eligibility credit for small employers. Nuclear production credit. Clean hydrogen production credit. Pre-filing registration requirement. Elective payment election. Transferring credits. Reminders Research credit claims on amended returns. General Instructions Who Must File Partnerships and S corporations. Applicable entity. Additional Information Elective Payment Elections and Transfer Elections Applicable entity making an elective payment election on IRA 2022 credits. Taxpayer making an elective payment election for certain IRA 2022 credits. Eligible taxpayer making an election to transfer certain IRA 2022 credits. Eligible taxpayer making an elective payment election for CHIPS 2022 credit. Registering for and Making Elective Payment and Transfer Elections Carryback and Carryforward of Unused Credit Figuring the carryforward if a payroll tax credit election is made. Change in Filing or Marital Status Credit Ordering Rule Order in which credits are used. Credit ordering for taxpayers making elective payment election. Eligible Small Business Member of controlled group, business under common control, or affiliated group. Treatment of partners and S corporation shareholders. Research Credit Claims on Amended Returns or Tax Equity and Fiscal Responsibility Act (TEFRA) Administrative Adjustment Requests (AAR), as Applicable Partners of BBA partnership. Specific Instructions Item A. Corporate alternative minimum tax (CAMT) and base erosion anti-abuse tax (BEAT). Part I. Current-Year Credit for Credits Not Allowed Against Tentative Minimum Tax (TMT) Line 1 Line 2 Line 3 Line 4 Check the box. Adjustment for the payroll tax credit. Line 5 Note. Part II. Allowable Credit Line 7 Individuals. Corporations. Estates and trusts. Non-pass-through partners. Line 10b Individuals. Estates and trusts. Corporations. Line 13 Special rules. Corporations. Line 17 C corporations. Lines 18 Through 26 Line 22 Line 23 Line 24 Line 25 Line 30 Line 32 Line 33 Line 34 Check the box. Adjustment for the payroll tax credit. Line 35 Note. Line 38 Part III. Current-Year General Business Credits Elective Payment of Certain Business Credits Under Section 6417 or Section 48D Transfer of Eligible Credits Under Section 6418 Basis reduction when certain credit transfers are made. Transfer election statement. Transferees of Eligible Credits Under Section 6418 Columns (a) Through (j) Column (a), Current year credits. Column (b), Elective payment or transfer registration number. Column (c), Number of items. Column (d), Pass-through or transfer credit entity EIN. Column (e), Credits from non-passive activities. Column (f), Current year passive activity credit. Column (g), Credit transfer election amount. Column (h), Gross elective payment election amount. Column (i), Net elective payment election amount. Column (j), Combine columns (e), (f), and (g), less column (i). Limitation on Certain Credits Reported in Part III Lines 1a, 1d, 1o, 4a, and 4k Note. Lines 1c and 4i Research credit limitation. Line 1e Line 1f Line 1k Line 1bb Line 1ff Lines 4a Through 4z Line 4h Line 6, column (g) Line 6, column (h) Line 6, column (i) Part IV. Carryovers of General Business Credits (GBCs) or Eligible Small Business Credits (ESBCs) Required statement. Adjustment for the payroll tax credit. Column (a), Credits carried over to tax year 2023. Column (b), Check if non-passive. Column (c), Year. Column (d), Pass-through entity EIN. Column (e), Credit carrybacks to current year. Column (f), Carryforwards (excluding ESBCs). Column (g), ESBC carryforwards. Line 1. Carryforward of certain other credits. Line 2. Line 3. Line 4. Part V. Breakdown of Aggregate Amounts in Part III for Facility-by-Facility, Multiple Pass-Through Entities, etc. Part VI. Breakdown of Aggregate Amounts in Part IV Instructions for Form 3800 - Notices Paperwork Reduction Act Notice. Instructions for Form 3800 (2023) General Business Credit Section references are to the Internal Revenue Code unless otherwise noted. 2023 Instructions for Form 3800 - Introductory Material Future Developments For the latest information about developments related to Form 3800 and its instructions, such as legislation enacted after they were published, go to IRS.gov/Form3800. What’s New 2023 Form 3800. The form has been redesigned to support the provisions of the Inflation Reduction Act of 2022 (IRA 2022) and the Creating Helpful Incentives to Produce Semiconductors Act of 2022 (CHIPS 2022). The form and instructions are revised to also provide information concerning the elective payment and transfer elections. Changes are highlighted below and explained more fully throughout the instructions. New item A. Item A requires a response concerning whether you are an applicable corporation under the Corporate Alternative Minimum Tax (CAMT) and an applicable taxpayer under the Base Erosion Anti-Abuse Tax (BEAT). Part I. Current Year Credit for Credits Not Allowed Against Tentative Minimum Tax (TMT). Lines 1 and 2 have been reworded to account for the new columns in Part III. Part II. Allowable Credit. Line 13 is revised to reflect the change to section 38(c)(6)(E), which provides that, for corporations, the limit for general business credits is 75% of net income tax (instead of regular income tax). Lines 22, 23, 30, and 32 are revised to account for the new columns (e), (f), and (g) in Part III to keep non-passive and passive credit amounts separate for filers claiming empowerment zone credits and specified credits. Part III. Current Year General Business Credits. Part III has been redesigned to support IRA 2022 and CHIPS 2022 and for all other current year credits. Credits that can only be carried forward have been moved to new Part IV. New Part IV. Carryovers of General Business Credits or Eligible Small Business Credits (ESBCs). Part IV has been created to separately report business credit carryforwards carried to 2023 and business credit carrybacks carried to 2023 from a subsequent year on an amended return or an application for tentative refund. As used in these instructions, “carryover” includes carryforwards and carrybacks. New Part V. Breakdown of Aggregate Amounts on Part III for Facility-by-Facility, Multiple Pass-Through Entities. Part V has been created to report breakout figures for each separate facility or pass-through entity, including those for which an elective payment or transfer registration number has been issued, or credits from multiple pass-through entities. New Part VI. Breakdown of Aggregate Amounts in Part IV. Part VI is used for breakout details of business credit carryforwards to 2023 from more than one prior year or business credit carrybacks from a subsequent year on an amended return or an application for tentative refund. This includes your share of any unused carryforward or carryback business credits from multiple pass-through entities. New military spouse retirement plan eligibility credit for small employers. The SECURE 2.0 Act of 2022 added section 45AA. It provides a credit to small employers who offer a defined contributions plan with specific features that benefit military spouses. This credit is reported on Part III, line 1ee. See the Instructions for Form 8881 for more information. Nuclear production credit. New Form 7213 will be used to report the credit for production from advanced nuclear power facilities reported on Part III, line 1cc. The new zero-emission nuclear power production credit will be reported on Part III, line 1u. See the Instructions for Form 7213 for more information. Clean hydrogen production credit. Starting with tax year 2023, the clean hydrogen production credit will be claimed on new Form 7210. This credit is reported on Part III, line 1g. For more information, see the Instructions for Form 7210. Pre-filing registration requirement. If you intend to make an elective payment election and/or a transfer election on Form 3800, you must complete a pre-filing registration before you file your tax return. See Registering for and Making Elective Payment and Transfer Elections , later. Elective payment election. Beginning with tax year 2023, certain applicable entities and electing taxpayers can elect to treat certain IRA 2022 business credits as elective payments. Certain eligible taxpayers can elect to treat CHIPS 2022 credits as elective payments. Any overpayments may result in refunds. See Elective Payment of Certain Business Credits Under Section 6417 or Section 48D , later. Transferring credits. Taxpayers may make an election to transfer all or a portion of certain IRA 2022 credits. See Transfer of Eligible Credits Under Section 6418 , later. Reminders Research credit claims on amended returns. Certain specific information must be provided if you are claiming a refund or credit on an amended return that includes a section 41 credit. See Research Credit Claims on Amended Returns or Tax Equity and Fiscal Responsibility Act (TEFRA) Administrative Adjustment Requests (AAR), as Applicable , later. General Instructions Partnerships and S corporations must always complete the source credit form unless they received the credit as a transfer from an unrelated eligible taxpayer. All other filers whose only source for a credit listed in Form 3800, Part III, is from a partnership, S corporation, estate, trust, or cooperative, or who received the credit as a transfer from an unrelated eligible taxpayer, report the credit directly on Form 3800. The following exceptions apply (unless you received the credit as a transfer from an unrelated eligible taxpayer). You are claiming the investment credit (Form 3468) or the biodiesel, renewable diesel, or sustainable aviation fuel credit (Form 8864). You are an estate or trust and the source credit must be allocated to beneficiaries. For more details, see the Instructions for Form 1041, U.S. Income Tax Return for Estates and Trusts, Schedule K-1, box 13. 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, U.S. Income Tax Return for Cooperative Associations, Schedule J, line 5c. Who Must File You must file Form 3800 to claim any of the general business credits. Partnerships and S corporations. Partnerships and S corporations that make elective payment elections, transfer elections (as transferor), or receive a credit from a transfer (as transferee) must complete the name and identifying number boxes on page 1 and the applicable lines of Parts III and V. Complete only the lines for credits for which an elective payment election or transfer election is made. Attach Form 3800 to your Form 1065 or Form 1120-S. See the instructions for Form 1065 at IRS.gov/Form1065 or Form 1120-S at IRS.gov/Form1120S. Partners and shareholders report their share of each transferred credit received from partnerships and S corporations on the applicable line of Part III of the partner’s or shareholder’s Form 3800. Applicable entity. Applicable entities that make an elective payment election for certain IRA 2022 credits must complete Form 3800 and their tax return. See Applicable entity making an elective payment election on IRA 2022 credits, below, for more information. Additional Information Elective Payment Elections and Transfer Elections CHIPS 2022 and IRA 2022 allow applicable entities or certain taxpayers to treat certain business credits as payments of federal income tax, or, in the case of partnerships or S corporations, to allow payments in the amount of such credits. Applicable entity making an elective payment election on IRA 2022 credits. IRA 2022 extends, modifies, or creates several energy-related investment and production tax credits. These credits are taken as general business credits. IRA 2022 also created new section 6417, which permits an applicable entity to make an elective payment election with respect to each applicable credit reported in Part III. Under section 6417(d)(1)(A), applicable entities are defined as: State and local governments, Indian tribal governments, Alaska Native Corporations, The Tennessee Valley Authority, Rural electric cooperatives, and Other tax-exempt entities. Proposed regulations have been published that provide a more detailed definition of an applicable entity. Entities may rely on the definitions in the proposed regulations for tax years ending before final regulations are published, provided the entity follows the proposed regulations in their entirety and in a consistent manner with respect to all elections made under section 6417. See Proposed Regulations under section 6417. The detailed description in the proposed regulations includes the following. An organization exempt from the tax imposed by subtitle A by reason of section 501(a); The government of any U.S. territory or political subdivision or instrumentality thereof; Any State, the District of Columbia, or a political subdivision or instrumentality thereof; The Tennessee Valley Authority; An Indian tribal government or a subdivision or instrumentality thereof; Any Alaska Native Corporation (as defined in section 3 of the Alaska Native Claims Settlement Act (43 U.S.C. 1602(m))); and Any corporation operating on a cooperative basis that is engaged in furnishing electric energy to persons in rural areas. Taxpayer making an elective payment election for certain IRA 2022 credits. In addition to these applicable entities, certain taxpayers (as defined under sections 6417(d)(1)(B), 6417(d)(1)(C), and 6417(d)(1)(D)); and partnerships and S corporations under section 6417(c), can make the elective payment election for the clean hydrogen credit, the carbon oxide sequestration credit, and the advanced manufacturing production credit reported in Part III. Eligible taxpayer making an election to transfer certain IRA 2022 credits. IRA 2022 also allows eligible taxpayers (taxpayers not described in section 6417(d)(1)(A)) and separately partnerships and S corporations under section 6418(c) to make elections to transfer certain IRA 2022 business credits (or portion thereof) reported in Part III to an unrelated person for cash. Eligible taxpayer making an elective payment election for CHIPS 2022 credit. Under CHIPS 2022, an eligible taxpayer (as defined under section 48D(c)), partnerships, and S corporations can make the elective payment election under section 48D(d) for the advanced manufacturing investment credit. See the specific instructions for Part III to make the elective payment elections and transfer elections. Registering for and Making Elective Payment and Transfer Elections If making an elective payment or transfer election, you must do the following. Prior to making the elective payment election on Form 3800, you must get a registration number for each facility or property. Go to IRS.gov/Register for elective payment or transfer of credits. Also, see Pub. 5884, Inflation Reduction Act (IRA) and CHIPS Act of 2022 (CHIPS) Pre-Filing Registration Tool, for more information about registering prior to making an elective payment or transfer election. Complete the required form(s) (for example, Form 3468) on which you calculate the specific general business credit(s). When completing a specific general business credit form, you must provide the registration number you received after completing step 1. You may also have to attach any information required regarding the entries made on the specific general business credit form. Complete the required lines on Form 3800. If you’re liable for tax, you must first consider if any part of the general business credit(s) may be applied against tax. See Part I and Part II and Credit Ordering Rule, later. To make the elective payment election, you will need to complete the appropriate line(s) in Part III. See Part III. Current-Year General Business Credits, later, for more information. In addition, you may also need to complete Part V. See Part V. Breakdown of Aggregate Amounts in Part III for Facility-by-Facility, Multiple Pass-Through Entities, etc., later, for information regarding when you must complete Part V. Attach all specific general business credit forms and Form 3800 to your return. See Part III, later, and your return instructions for where to report the elective payment election. Note. Completion of the pre-filing registration requirements and receipt of a registration number does not, by itself, mean that you have earned the credit and made a proper election under section 48D(d), 6417, or 6418. A registration number is valid only for the tax year for which it was obtained. It must be renewed if an elective payment election or transfer is sought in a subsequent year. Changes with respect to one or more credit properties, including changes in ownership, require the applicable entity, electing taxpayer, or eligible taxpayer under section 48D(d) to file an amended registration to reflect the new facts. For more information, see Temporary Regulations sections 1.48D-6T, 1.6417-5T, and 1.6418-4T that apply to tax years ending on or after June 21, 2023. See the tax year 2023 instructions for the credit forms. Carryback and Carryforward of Unused Credit For purposes of carryback and carryforward rules, unused credit means the sum of business credits carried forward to your tax year on Part IV, plus the amount of your net current credits on Part III, columns (e), (f), and (g), that exceeds the sum of any amount of such business credits allowed against your net income tax in Part II, line 38, plus the amount allowed to you as a net elective payment election amount in Part III, column (i), for the tax year. However, any credit amounts allowed to you as a net elective payment election amount in Part III, column (i) are treated as payments and are not considered unused credits for purposes of carryback and carryforward rules. The carryforward must be reduced if there has been a recapture, which can occur due to change in ownership or change in use of property, for example. If a grant under section 1603 of the American Recovery and Reinvestment Act of 2009 is received, the carryforward must be reduced to zero. For further information, see Form 4255, Recapture of Investment Credit. If you can't use part or all of your general business credit because of the tax liability limit (Part II, line 38, is less than the sum of Part I, line 6, and Part II, lines 25 and 36), carry the unused credit back to prior years. The carryback period is generally 1 year. To carry back an unused credit, file an amended return (Form 1040-X, Amended U.S. Individual Income Tax Return; Form 1120-X, Amended U.S. Corporation Income Tax Return; 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. In general, no part of the unused credit for any year attributable to any credit can be carried back to any tax year before the first tax year for which that credit was first allowable. However, this general rule does not apply to unused credits listed in section 6417(b), which may be carried back 3 tax years. A “specified credit” cannot be carried back to any tax year before the first tax year for which that specified credit was allowed against TMT. See Credit Ordering Rule, later, to determine which credits are allowed first. In general, unused general business credits may be carried back 1 year and carried forward 20 years. Unused marginal oil and gas well production credits may be carried back 5 years and carried forward 20 years. Unused credits listed in section 6417(b) may be carried back 3 years and carried forward 20 years. Any qualified business credits (as defined in section 196(c)) that are unused after the last tax year of the 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: The tax year following the last tax year of the carryforward period, or The tax year in which the individual taxpayer dies or other taxpayer ceases to exist. Figuring the carryforward if a payroll tax credit election is made. Qualified small businesses electing to claim a portion of the research credit as a payroll tax credit must adjust the research credit carryforward for the amount of the credit elected as a payroll tax credit on Form 6765, Credit for Increasing Research Activities. A qualified small business is defined differently than an eligible small business. See Qualified Small Business and Eligible Small Business in the Instructions for Form 6765 for definitions. The unused credit for the current year is determined by reducing the amount on Part I, line 6, and Part II, line 36, by the amount on Form 6765, line 44. If you have amounts on both Part I, line 6, and Part II, line 36, the reduction is made proportionately. No amount elected as a payroll tax credit can be used to offset the current year tax liability nor can it be included in the carryforward or carryback calculation. Change in Filing or Marital Status 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: You filed as single in the credit year, but filed a joint return in the carryback or carryforward year; You filed a joint return in the credit year, but filed a joint return with a different spouse in the carryback or carryforward year; or You were married and filed a separate return in the credit year, but filed a joint return with the same or a different spouse in the carryback or carryforward year. Determine your separate tax liability in the carryback or carryforward year as follows. Figure your tax for the carryback or carryforward year as though you were married filing a separate return. Figure your spouse's tax in that year as though your spouse was married filing a separate return. Add the amounts in steps 1 and 2. Divide the amount in step 1 by the amount in step 3. The result should be rounded to at least three decimal places. Multiply the decimal in step 4 by the total tax shown on your joint return for the carryback or carryforward year. The result is your separate tax liability and a carryback or carryforward credit is applied against this amount only. 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. Credit Ordering Rule 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: Carryforwards to that year, the earliest ones first; The general business credit earned in that year; and The carryback to that year. If your general business credits exceed your tax liability limit figured in Part II, the credits are generally used in the following order and based on the order shown under Order in which credits are used next. Credit amounts allowed as a net elective payment election amount in column (i) of Part III are treated as payments and are not considered used or unused credits for carryback and carryforward rules. Credits reported on line 2 of Part III, columns (e), (f), and (g), plus line 2zz of Part IV, columns (e) and (f). Credits reported on Part II, line 25. Specified credits other than eligible small business (ESB) credits reported on line 5 of Part III, columns (e), (f), and (g), plus line 2zz of Part IV, columns (e) and (f). ESB credits reported on line 6 of Part IV, column (g). Order in which credits are used. When relevant, the components of the general business credit reported on Form 3800 arising in a single tax year are generally used in the following order. Investment credit (in the following order—rehabilitation credit, energy credit, qualifying advanced coal project credit, qualifying gasification project credit, qualifying advanced energy project credit, qualifying therapeutic discovery project credit (carryforward only), and advanced manufacturing investment credit.) (Form 3468, Parts II, III, IV, VI, and VII). Work opportunity credit (Form 5884). Biofuel producer credit (Form 6478). Credit for increasing research activities (Form 6765). Low-income housing credit (Form 8586). Enhanced oil recovery credit (Form 8830). Disabled access credit (Form 8826). Renewable electricity production credit (Form 8835). Empowerment zone employment credit (Form 8844). Renewal community employment credit (carryforward only). Indian employment credit (carryfoward only). Employer social security and Medicare taxes paid on certain employee tips (Form 8846). Orphan drug credit (Form 8820). New markets credit (Form 8874). Credit for small employer pension plan startup costs (Form 8881, Part I). Credit for employer-provided childcare facilities and services (Form 8882). Qualified railroad track maintenance credit (Form 8900). Biodiesel, renewable diesel (Form 8864). Low sulfur diesel fuel production credit (Form 8896). Credit for oil and gas production from marginal wells (Form 8904). Distilled spirits credit (Form 8906). Advanced nuclear power facility production (Form 7213, Part I). Nonconventional source fuel credit (carryforward only). Energy efficient home credit (Form 8908). Energy efficient appliance credit (carryforward only). Alternative motor vehicle credit (Form 8910, Part II). Alternative fuel vehicle refueling property credit (Form 8911, Part II). Mine rescue team training credit (carryforward only). Agricultural chemicals security credit (carryforward only). Credit for employer differential wage payments (Form 8932). Carbon oxide sequestration credit (Form 8933). Qualified plug-in electric vehicle credit (carryforward only). New clean vehicle credit (Form 8936, Part II). Credit for small employer health insurance premiums (Form 8941). Employee retention credit for employers affected by qualified disasters (carryforward only). Employer credit for paid family and medical leave (Form 8994). Credit for auto-enrollment (Form 8881, Part II). Zero-emission nuclear power production (Form 7213, Part II). Sustainable aviation fuel (Form 8864, line 8). Clean hydrogen production (Form 7210). Qualified commercial clean vehicle (Form 8936, Part V). Advanced manufacturing production (Form 7207). Military spouse retirement plan credit (Form 8881, Part III). General credits from an electing large partnership (carryforward only). Credit ordering for taxpayers making elective payment election. If you made an elective payment election for certain current credits reported on Part III, credit amounts allowed as a net elective payment election amount in column (i) of Part III are treated as payments and are not considered for carryback and carryforward rules. This also applies to applicable entities. Any applicable entity with unrelated business income tax (UBIT) under section 512 uses an applicable credit with respect to a facility or property only if it is not part of the net elective payment election amount in column (i) of Part III and regardless of whether or not such facility or property was used in connection with the unrelated business. See the examples on how to calculate the net elective payment election amounts in column (i), later. Eligible Small Business An eligible small business is: A corporation whose stock is not publicly traded, A partnership, or A sole proprietorship. The average annual gross receipts of the corporation, partnership, or sole proprietorship for the 3-tax-year period preceding the tax year of the credit cannot exceed $50 million. Gross receipts for any tax year must be reduced by returns and allowances made during the year. Any reference to your business also includes a reference to any predecessor of your business. If your business was not in existence for the entire 3-year period, base your average annual gross receipts on the period your business existed. Also, if your business had a tax year of less than 12 months, your gross receipts must be annualized by multiplying the gross receipts for the short period by 12 and dividing the result by the number of months in the short period. Member of controlled group, business under common control, or affiliated group. For purposes of the gross receipts test, all members of a controlled group of corporations (as defined in section 52(a)) and all members of a group of businesses under common control (as defined in section 52(b)) are treated as a single person, and all employees of the members of an affiliated service group (as defined in sections 414(m) and (o)) will be treated as employed by a single person. Treatment of partners and S corporation shareholders. A partner or S corporation shareholder cannot be treated as an eligible small business unless both the partnership or S corporation and partner or shareholder meet the gross receipts test as discussed under Eligible Small Business, earlier, for the tax year that the credit is treated as a current year general business credit. Research Credit Claims on Amended Returns or Tax Equity and Fiscal Responsibility Act (TEFRA) Administrative Adjustment Requests (AAR), as Applicable TEFRA partnerships and partners in TEFRA partnerships cannot file amended returns; they must instead file AARs. An AAR is a statutorily provided type of amended filing used to change TEFRA partnership items. If you are claiming a refund or credit on an amended return or AAR (as applicable) that includes a section 41 credit for increasing research activities that either (a) was not reported on your original filed return, or (b) is increased from the amount reported on your original return, and the section 41 credit you’re claiming on the amended return comes from a non-Bipartisan Budget Act (BBA) pass-through entity such as a TEFRA partnership, S corporation, estate, trust, cooperative, or other non-TEFRA or non-BBA pass-through entity whose tax year ended during the tax year for which you are filing your amended return, the following five items of information must be identified and provided with your claim for each business component. The factual basis of your section 41 research credit claim. The research activities performed. The individuals who performed each research activity. A taxpayer may instead identify the individuals who performed each research activity by listing the individual’s title or position. The information each individual sought to discover. The total qualified employee wage expenses, total qualified supply expenses, and total qualified contract research expenses incurred by the non-BBA pass-through entity for its claim year. This information may be provided by submitting a copy of Form 6765 used by the non-BBA pass-through entity. If you submit a credit study or other document, please identify the exact pages that contain the five items of information described above. Note. The above requirements apply to all claimants, including sole proprietorships, per entity, regardless of business structure. A taxpayer whose amended return includes a section 41 credit for increasing research activities from more than one non-BBA pass-through entity must separately provide the five items of information for each non-BBA pass-through entity. Partners, shareholders, or other owners of a non-BBA pass-through entity should receive this information directly from the non-BBA pass-through entity, for example, in the form of an amended Schedule K-1 (and any statements attached thereto). Partners of BBA partnership. BBA partnerships cannot file amended returns; they must instead file AARs. A BBA AAR is a statutorily provided type of amended filing used to change partnership-related items for any partnership tax year. If you are a partner of a BBA partnership and filing a return that includes a section 41 credit for increasing research activities from the BBA partnership's AAR, you may, but are not required to, include the five items of information with your return to which your Form 8978, Partner's Additional Reporting Year Tax, is attached if the BBA partnership has provided the information with its AAR. Specific Instructions Complete and attach the appropriate credit forms used to figure your current year credit. See exceptions under General Instructions, earlier. Item A. Corporate alternative minimum tax (CAMT) and base erosion anti-abuse tax (BEAT). If you are both an “applicable corporation” within the meaning of section 59(k)(1) and “applicable taxpayer” within the meaning of section 59A(e), check “Yes.” Otherwise, check “No.” Part I. Current-Year Credit for Credits Not Allowed Against Tentative Minimum Tax (TMT) Complete Parts III, columns (a) through (h), IV, V, and VI (if applicable) before completing Parts I and II. Line 1 Non-passive credits from Part III, line 2. Combine column (e) with non-passive amounts from column (g). Do not take into account any amount in column (g) from passive activities. See Transfer of Eligible Credits Under Section 6418 and Transferees of Eligible Credits Under Section 6418, later. Line 2 Report on line 2 the total of all passive activity credit amounts included on the following lines: Part III, line 2, columns (f) and (g); Part IV, line 2zz, columns (e) and (f). Line 3 Enter the applicable passive activity credit amount allowed from Form 8582-CR, Passive Activity Credit Limitations; or Form 8810, Corporate Passive Activity Loss and Credit Limitations. The passive activity credit amount allowed on Part I, line 3, only applies to the general business credits not allowed against TMT from Part I, line 2. Do not include specified credits on line 3. If no credits are allowed, enter -0- on line 3. Line 4 Enter the amount of non-passive carryforwards to 2023 of unused credits that are reported from line 2zz of Part IV, column (f). Check the box. For each credit entered on line 4, if the credit amount was changed or revised from the amount originally reported, check the box on this line and see the instructions for Part IV and Part VI (if applicable) for Required statement, later. Adjustment for the payroll tax credit. A qualified small business that elected on Form 6765 to claim a portion of its research credit as a payroll tax credit must reduce its research credit carryforward by the amount elected as a payroll tax credit. Line 5 Use Part I, line 5, only when you amend your 2023 return to carry back unused credits from 2024. Enter the non-passive amount that is reported from line 2zz of Part IV, column (e). Note. Individuals claiming the research credit from a sole proprietorship or pass-through entity don't include any carryback of that credit on Part I, line 5, before figuring the limitation on Part III, line 1c. Include the carryback when figuring the research credit limitation on line 1c of Part III. Then, include the allowable carryback amount on Part I, line 5. See Required statement, later, and attach the statement to your return. Part II. Allowable Credit Line 7 Individuals. Enter the sum of the amounts from Form 1040, 1040-SR, or 1040-NR, line 16; and Schedule 2 (Form 1040), line 2. Don’t include any recapture of an education credit, any tax from Form 8621, any net tax liability deferred under section 965(i), or any triggering event under section 965(i). Corporations. Enter the amount from Form 1120, Schedule J, line 1, or other applicable line of your return. Do not include any deferred tax under section 1291, or additional tax under section 197(f). Estates and trusts. Enter the amount from Form 1041, Schedule G, lines 1a and 1b, plus any Form 8978 amount included on line 1d; or the amount from the applicable line of your return. Non-pass-through partners. Partners other than pass-through partners (such as partnerships or S corporations) use Form 8978 and Schedule A (Form 8978)—not Form 3800—to calculate their reporting year tax net of credits. However, credit carryforwards resulting from a Form 8978 calculation are reported on the partner’s next tax year’s Form 3800, Parts IV and VI, if applicable. See Form 8978 and its instructions. Line 10b Enter the total allowable credit, if any, from your tax return as follows. Individuals. Enter the amount from Form 1040, 1040-SR, or 1040-NR, line 19; and Schedule 3 (Form 1040), lines 2 through 4, 5a, 5b, and line 7. Don't include any general business credit claimed on Form 3800, any prior year minimum tax, or any credit claimed on Form 8912, Credit to Holders of Tax Credit Bonds. Estates and trusts. Enter the total of any write-in credits from Form 1041, Schedule G, line 2e; or the amount from the applicable line of your return. Corporations. Enter the amount from Form 1120, Schedule J, Part I, line 5b (or the applicable line of your return). Corporations reporting a Form 8978 amount on Schedule J, line 6, must also include this amount on line 10b. If line 11 is zero or less, these corporations must enter -0- on line 11, skip lines 12 through 15, and enter -0- on line 16. Line 13 Special rules. See section 38(c)(6) for special rules that apply to married couples filing separate returns, controlled corporate groups, regulated investment companies, real estate investment trusts, estates, and trusts. Corporations. Corporations are allowed a general business credit equal to 25% of the excess (if any) of net income tax over $25,000. Net income tax means the sum of the regular tax liability and the tax imposed by the alternative minimum tax under section 55, reduced by certain other credits. Line 17 C 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 Part II, line 17, and write “Sec. 383” or “Sec. 384” in the margin next to your entry on Part II, line 17. Lines 18 Through 26 These lines are used to claim the empowerment zone employment credit and the renewal community employment credit. Complete lines 18 through 26 only if you have entered an amount for the empowerment zone employment credit on line 3 of Part III, column (e) or (f), or the renewal community employment credit on line 3 of Part III, column (e) or (f), or line 3 of Part IV, column (e) or (f). Line 22 Combine the amounts from Part III, line 3, column (e), with the sum of the non-passive activity credit amounts in Part IV, line 3, column (e) plus column (f). The carryforward and carryback for Form 8844 (Part IV, line 3, columns (e) and (f)) will flow to this line. Line 23 Enter the passive activity credit from Part III, line 3, column (f), plus the sum of the passive activity credit amount in Part IV, line 3, column (e) plus column (f). Line 24 Enter the applicable passive activity credit amount for the empowerment zone and renewal community employment credit allowed from Form 8582-CR or Form 8810. The passive activity credit amount allowed on Part II, line 24, only applies to the empowerment zone and renewal community employment credit reported on Part III, line 3, plus any prior year unallowed passive activity empowerment zone and renewal community employment credit. See the instructions for the applicable form for details. If no credits are allowed, enter -0- on line 24. See the instructions for Part I, line 3, for the definition of passive activity. Line 25 Add lines 22 and 24. If you have amounts on both line 23 and line 24, the total on line 25 will be comprised of both non-passive and passive credit amounts. Attach a statement providing a breakout of the non-passive and passive credit amounts on line 25. Passive activity credit amounts generally can only be used to offset positive passive activity income. Line 30 Enter the general business credit from Part III, line 5. Combine column (e) with non-passive amounts in column (g). Do not take into account any amount in column (g) from passive activities. See Caution under Line 1, earlier. Line 32 Enter the sum of passive activity credits from Part III, line 5. Combine column (f) with passive amounts in column (g). Do not take into account any amount in column (g) from non-passive activities. See Caution under Line 2, earlier. Line 33 Enter the applicable passive activity credit amount for general business credits allowed against TMT and eligible small business credits allowed from Form 8582-CR or Form 8810. See the instructions for the applicable form for details. The passive activity credit amount allowed on Part II, line 33, only applies to the general business credits from Part II, line 32, plus any prior-year unallowed passive activity credit from general business credits reported on Part IV, line 4, column (f), and the eligible small business credit. If no credits are allowed, enter -0- on line 33. See the instructions for Part I, line 3, for the definition of a passive activity. Line 34 Enter the amount of all carryforwards to 2023 of unused credits that are reported from Part IV, line 5, column (f), and Part IV, line 6, column (g). Check the box. For each credit entered on line 34, if the credit amount was changed or revised from the amount originally reported, check the box on this line and see the Required statement. Note. Individuals claiming the research credit from a sole proprietorship or pass-through entity don't include any carryforward of that credit on Part II, line 34, before figuring the limitation on Part III, line 1c and line 4i. Include the carryforward when figuring the research credit limitation on line 1c and line 4i of Part III. Then, include the allowable carryforward amount on Part II, line 34. See the instructions for the Required statement. Adjustment for the payroll tax credit. A qualified small business that elected on Form 6765 to claim a portion of its research credit as a payroll tax credit must reduce its research credit carryforward by the amount elected as a payroll tax credit. Line 35 Use Part II, line 35, only when you amend your 2023 tax return to carry back unused credits from 2024. Enter the carryback amount that is reported in Part IV, line 5, column (e). You may not carry back specified credits, including ESB credits, to any tax year before the first tax year for which that specified credit was allowed against TMT. Note. Individuals claiming the research credit from a sole proprietorship or pass-through entity don't include any carryback of that credit on Part II, line 35, before figuring the limitation on Part III, line 4i. Include the carryback when figuring the research credit limitation on Part III, line 4i. Then, include the allowable carryback amount on Part II, line 35. See Required statement, later, and attach the statement to your return. Line 38 If the sum of Part II, line 38, and Part III, line 6, column (i), is smaller than the sum of Part I, lines 1, 3, and 4, and Part II, lines 30, 33, and 34 (carryforwards and current business credits only), see Carryback and Carryforward of Unused Credit, earlier. Part III. Current-Year General Business Credits If you are claiming a current business credit on your tax return, you must complete the applicable lines and columns of Part III. This requirement includes applicable entities and certain taxpayers, partnerships, and S corporations making an elective payment election, eligible taxpayers making a transfer election under section 6418, and transferees of a credit under section 6418. Complete columns (b), (g), (h), and (i) of Part III (as applicable) only if you are making the elective payment election under section 6417, the transfer election under section 6418 (as transferor), or receive a credit from a transfer (as transferee). Partnerships and S corporations that are transferees of credits from an eligible taxpayer under section 6418 report on the applicable line of Part III and Part V (if applicable) of Form 3800. Complete column (c) of Part III and complete Part V only if you are reporting more than one facility or more than one pass-through entity as sources for any one credit. Partners and shareholders report your share of each IRA 2022 credit transferred to a partnership and S corporation on the applicable line of Part III and Part V (if applicable) of Form 3800. Complete column (d) of Part III only if you are receiving the credit on a Schedule K-1 from a pass-through entity or receive (as transferee) an eligible credit under section 6418 from an unrelated taxpayer. Elective Payment of Certain Business Credits Under Section 6417 or Section 48D An applicable entity, as defined in section 6417(d)(1)(A) (generally, a governmental or a tax-exempt entity), can elect to treat current applicable credits as payments against the tax imposed by Subtitle A for its tax year beginning in 2023. Because amounts must first be applied to tax (if any) before being treated as a payment, amounts treated as a payment (net payment election amounts) are limited to the total of unused credits (without application of any elective payment election). See Credit Ordering Rule , earlier. Applicable credits reported in Part III, column (h) include the following. Alternative fuel vehicle refueling property, section 30C(d)(1), Form 8911, Part II. Renewable electricity production, section 45, Form 8835 for qualified facilities after 2022, Part II. Carbon oxide sequestration, section 45Q, Form 8933 for carbon-capture equipment placed in service after 2022, Part III. Zero-emission nuclear power production, section 45U, Form 7213, Part II. Clean hydrogen production, section 45V, Form 7210, Part IV. Qualified commercial clean vehicles, section 45W, Form 8936, but not including credits passed through from partnerships or S corporations. See Instructions for Form 8936. Advanced manufacturing production, section 45X, Form 7207, Part II. Energy credit, section 48, Form 3468, Part VI. Qualifying advanced energy project credit, section 48C, Form 3468, Part III. Taxpayers that are not applicable entities, including partnerships and S corporations, may elect to be treated as applicable entities but only with respect to the following applicable credits reported in Part III, column (h). Carbon oxide sequestration for capture equipment placed in service after 2022, Form 8933, Part III. Clean hydrogen production, Form 7210, Part IV. Advanced manufacturing production, Form 7207, Part II. Taxpayers, including partnerships and S corporations, may also elect payment for advanced manufacturing investment, section 48D, Form 3468, Part IV, reported on line 1o, column (h), of Part III. To make an elective payment election, if you have multiple facilities for which you're claiming one of the above credits, complete Part V and then Part III. In Part V, list each facility; in Part III, combine the amounts from all facilities for each credit. If you have only one facility for which you're claiming any one of the above credits, you do not need to use Part V. Complete each line on Part III for which you're claiming an elective payment using the instructions under Columns (a) through (j), later. Paper returns take longer to process than e-filed returns. If a return is filed on paper claiming an elective payment election, the delays in processing could be increased. Transfer of Eligible Credits Under Section 6418 Eligible taxpayers (taxpayers other than applicable entities) can elect to transfer the following eligible credits. Alternative fuel vehicle refueling property, section 30C(d)(1), Form 8911, Part II. Renewable electricity production, section 45, Form 8835, Part II. Carbon oxide sequestration, section 45Q, Form 8933, but not including the credit made under section 45Q(f)(3)(B) election, Part III. Zero-emission nuclear power production, section 45U, Form 7213, Part II. Clean hydrogen production, section 45V, Form 7210, Part IV. Advanced manufacturing production, section 45X, Form 7207, Part II. Energy credit, section 48, Form 3468, Part VI, but not including the credit under section 50(d)(5) and Regulations section 1.48-4. Qualifying advanced energy project credit, section 48C, Form 3468, Part III. To make the transfer, if you have multiple facilities for which you're claiming one of the above credits, complete Part V and then Part III. In Part V, complete a line for each facility. In column (a) of Part V, indicate the line number of the credit as shown in Part III. In Part III, combine the amounts from all facilities for each credit. If you have only one facility for which you're claiming any one of the above credits, you do not need to use Part V. Complete each line in Part III for which you're electing to transfer an eligible credit as transferor or claiming an eligible credit as transferee using the instructions under Columns (a) through (j), later. Basis reduction when certain credit transfers are made. If an energy investment credit (section 48) or qualifying advanced energy project credit (section 48C) is transferred, the basis reduction rule of section 50(c) applies to the applicable investment credit property as if the transferred eligible credit was allowed to the eligible taxpayer. Transfer election statement. Proposed Regulations section 1.6418-2(b)(3)(iv), issued June 21, 2023, requires transferors and transferees to each attach to their return a transfer election statement, as defined in section 1.6418-5(b)(5), for every transfer they make under section 6418. The purchase and sale document for the transfer may be used for this purpose, provided it contains the information listed below. The document used for this purpose must be labeled “Transfer Election Statement.” A transferor of a credit by an eligible taxpayer under section 6418 is required to attach to Form 3800 any written agreements (or other similar statements) to transfer and sell eligible credits (or portion thereof) to unrelated transferee taxpayers. Such agreement or transfer election statement must include each of the following. Name, address, and taxpayer identification number of the transferee taxpayer and the eligible taxpayer. If the transferee taxpayer or eligible taxpayer is a member of a consolidated group (as defined in section 1.1502-1), then only include information for the group member that is the transferee taxpayer or eligible taxpayer (if different from the return filer). A statement that provides the information and amounts necessary to allow the transferee taxpayer to take into account the specified credit transferred, including the following. The name of the credit form as shown in column (a) of the applicable line of Form 3800, Part III or Part V (if applicable) (for example, advanced manufacturing production credit is “Form 7207” on line 1b of Part III); the total amount of the credit determined with respect to the facility or property in column (e) or (f) (column (d) or (e) of Part V), and the amount of the transferred credit (or portion thereof) in column (g) (column (f) of Part V). The tax year of the eligible taxpayer and the first tax year in which the specified credit portion will be taken into account by the transferee taxpayer. The amount(s) of the cash consideration and date(s) on which paid by the transferee taxpayer. The IRS-issued registration number related to the facility or property in column (b) of Part III or V. A statement attesting that the eligible taxpayer or any member of its controlled group is not related to the transferee taxpayer or any member of its controlled group within the meaning of section 267(b) or section 707(b)(1). A statement or representation from the eligible taxpayer that it has complied with all requirements of section 6418 and the eligible credit code section, including, but not limited to, prevailing wage, apprenticeship, and domestic content requirements (if applicable). A statement or representation from the eligible taxpayer and the transferee taxpayer acknowledging the notification of recapture requirements under section 6418(g)(3) (if applicable). A declaration, applicable to the statement and any accompanying documents, signed by you, or signed by a person currently authorized to bind you in such matters, in the following form: “Under penalties of perjury, I declare that I have examined this statement, including accompanying documents, and to the best of my knowledge and belief, the facts presented in support of this statement are true, correct, and complete.” Taxpayers may rely on the proposed regulations unless they are replaced with final regulations before the end of the taxpayer's tax year, provided the taxpayers follow the proposed regulations in their entirety and in a consistent manner. See Proposed Regulations section 6418, Transfer of Certain Credits. Transferees of Eligible Credits Under Section 6418 A transferee taxpayer, including a partnership or an S corporation, which receives an eligible credit (or portion thereof) from an unrelated eligible taxpayer, takes that credit into account in its first tax year ending with, or after, the tax year of the eligible taxpayer that otherwise earned and reported the credit on the appropriate source credit form. The transferee taxpayer (and not the eligible taxpayer) is treated as the taxpayer with respect to such credit (or portion thereof). To report the transferred credit on Form 3800, if there are multiple facilities for which you're receiving one of the above credits, complete Part V and then Part III. In Part V, list separately the credit transferred from each facility or from each pass-through entity using the registration number(s) provided by the transferor(s). In Part III, combine the amounts from all facilities and all pass-through entities for each credit. If there is only one facility or one pass-through entity from which you have received a credit transfer of one of the above credits, you do not need to use Part V. See Transfer election statement and the section 6418 proposed regulations for additional information to include with your Form 3800. If you are a transferee, including a partnership or an S corporation, that paid cash for an eligible credit, attach each transfer election statement to your Form 3800 to report any transferred credits in Parts III and V. See specific instructions for column (g) of Part III or column (f) of Part V, later. Columns (a) Through (j) Column (a), Current year credits. Current year general business credits available are listed in column (a). See Part IV, later, for keywords related to the names of the credits. Column (b), Elective payment or transfer registration number. If an elective payment election or a transfer election has been made, enter the registration number (as shown on the source credit form) in column (b). If there are multiple facilities for the same credit listed in Part V, enter in column (b) of Part III the first registration number listed for that credit in Part V. Column (c), Number of items. If in Part V you listed multiple facilities or multiple pass-through entities for any credit, enter in column (c) of Part III the number of facilities and/or pass-through entities listed for that credit in Part V. Otherwise, you can leave column (c) blank. Do not enter figures in the total rows for column (c). Column (d), Pass-through or transfer credit entity EIN. Complete column (d) only if you are receiving the credit on a Schedule K-1 from a pass-through entity, or receiving (as transferee) the credit from an unrelated taxpayer. If you are reporting a credit allocated to you from a pass-through entity, enter that pass-through entity's employer identification number (EIN) under column (d) for that credit. If you are reporting a credit reported to you on Form 1099-PATR, Taxable Distributions Received From Cooperatives, enter that cooperative's EIN under column (d) for that credit. If there are multiple pass-through entities for the same credit, report the credit for each pass-through entity in Part V and then enter the EIN of the pass-through entity allocating the greatest amount of the credit to you in Part III, column (d). If you are reporting a transferred credit received from an eligible taxpayer or transferor under section 6418, enter that transferor entity's employer identification number (EIN) under column (d) for that credit. If there are multiple transferor entities for the same credit, report the credit for each transferor entity in Part V and then enter the EIN of the transferor entity that sold the greatest amount of the credit to you in Part III, column (d). Column (e), Credits from non-passive activities. Enter the credits that for you are non-passive based on your level of participation in the activity. Column (f), Current year passive activity credit. Enter the current year passive activity credits allowable to you before applying the passive activity credit limitations of Form 8582-CR or Form 8810. Column (g), Credit transfer election amount. Indicate the transfer election by entering the amount transferred by you to another entity as a negative number. If you are a transferee, enter the amount transferred to you as a positive number. Column (h), Gross elective payment election amount. Enter the amount of the elective payment election based on the total credit for which an elective payment election is being made before calculating the net elective payment election amount and before considering limitations from Part II. See Line 6, column (h), later. Note. The figures for columns (i) and (j) do not flow directly from the columns to the left. Don’t complete columns (i) and (j) until you have completed Parts III, columns (a) through (h); IV, V, and VI (if applicable) and then completed Parts I and II. Column (i), Net elective payment election amount. Your net elective payment election amount is equal to the lesser of the sum of all current credits for which an elective payment election is made, or the excess, if any, of the total available carryforward credits in Part IV and current business credits reported on line 6, columns (e), (f), and (g), of Part III over the amount of the otherwise allowable business credits included on line 38 of Part II, Credit allowed for the current year. If you are making an elective payment election for one credit, enter the calculated net elective payment election amount in column (i). Any remainder is treated as part of the general business credit amount on line 38. If you have no tax liability figured in Part II, enter each amount from column (h) as a net elective payment election amount in column (i). If you are making an elective payment election for multiple credits and your calculated net elective payment election amount is less than the sum of such credits, the net elective payment election amount and any remainder amount for each credit is determined based on the listing in Order in which credits are used, earlier. See the instructions for line 6 of Part III, column (i), below. Example 1. In 2023, ABC is in the business of producing semiconductors at an advanced manufacturing facility under section 48D. ABC also claimed the research credit under section 41. ABC claimed a current credit for its investment in an advanced manufacturing facility with an IRS-issued registration number of $100,000 and a research credit of $60,000. ABC has no other business credits, including business credit carryforwards to the year. ABC reports its current research credit and advanced manufacturing investment credit on Form 3800, Part III. On Form 6765, Part III, line 1c, ABC leaves columns (c) and (d) blank, and enters $60,000 in column (e), credits from non-passive activities. ABC makes an elective payment election for the advanced manufacturing investment credit by completing line 1o of Part III of Form 3800 as follows. Column (b) is the IRS-issued registration number. Column (c) is left blank because ABC has only one facility. Column (d) is left blank because ABC can’t transfer any of its credit. Column (e) is $100,000, the amount of the advanced manufacturing investment credit for ABC, figured on Form 3468, Part IV. Column (f) is blank because none of the credit is subject to the passive activity limitation rules. Column (g) is blank because ABC can’t transfer any of its credit. Column (h) is $100,000, the gross elective payment election amount. (If ABC had multiple advanced manufacturing facilities, it would have obtained a registration number for each facility and would list those facilities separately in Part V of Form 3800, and then provide the aggregate amounts in Part III.) Before completing Part III, column (i), ABC enters $100,000 of the advanced manufacturing investment credit (Form 3468, Part IV) and $60,000 of the research credit (Form 6765) on line 1 of Part I. ABC determines the limitation amount figured in Part II. For purposes of this example, ABC enters $100,000 of net income tax on line 11 and $81,250 on line 38 of Part II. ABC then calculates the net elective payment election amount for column (i). ABC determines the excess of its available business credits of $160,000 (without application of any elective payment election amount) reported on Part III, line 6, columns (e), (f), and (g), over the allowable credits of $81,250 included on Part II, line 38. The excess is $78,750, which is less than $100,000 of the credit for which an election is made, and so the net elective payment election amount is $78,750. As a result, the remaining $21,250 of the advanced manufacturing investment credit and $60,000 of the research credit make up the Part II, line 38. ABC enters $78,750 on line 1o, column (i) of Part III. This net elective payment election amount is also reported on the designated line of ABC’s return. See the instructions for line 6 of Part III, column (h) and (i), later. Example 2. In 2023, XYZ, an applicable entity, places in service and claims a credit for energy investment property of $100,000 under section 48. This energy property with an IRS-issued registration number is not an asset used in connection with its unrelated business. XYZ is also entitled to the work opportunity tax credit in connection with its unrelated business under section 51(a). XYZ also has a general business credit carryforward of $10,000. XYZ has no other business credits. XYZ reports its current work opportunity tax credit and energy property credit on Form 3800, Part III. On its Part III, line 4b (Form 5884), XYZ leaves columns (c) and (d) blank, and enters $50,000 in column (e), (credits from non-passive activities). XYZ reports its carryforward amount of $10,000 in Part IV. XYZ makes an elective payment election for the energy property credit by completing line 4a of Part III of Form 3800 as follows. Column (b) is the IRS-issued registration number. Column (c) is left blank because XYZ has only one facility. Column (d) is left blank because XYZ is not transferring any of its credits. Column (e) is $100,000, the amount of the energy credit for XYZ, figured on Form 3468, Part VI. Column (f) is blank because none of the credit is subject to the passive activity limitation rules. Column (g) is blank because XYZ can't transfer any of its credit. Column (h) is $100,000, the gross elective payment election amount. (If XYZ had multiple investment energy properties, whether or not used in connection with its unrelated business, it would have obtained a registration number for each facility or property and would list those facilities separately in Part V of Form 3800, and then provide the aggregate amounts in Part III.) Before completing Part III, column (i), XYZ enters $10,000 of the general business credit carryforward on line 4 of Part I, $100,000 of the energy credit (Form 3468, Part VI), and $50,000 of the work opportunity credit (Form 5884) on line 30 of Part II. XYZ determines the limitation amount figured in Part II. For purposes of this example, XYZ enters $100,000 of net income tax on line 11 and $81,250 on line 38 of Part II. XYZ then calculates the net elective payment election amount for column (i). XYZ determines the excess of its available carryforward and current business credits of $160,000 (without application of any elective payment election amount) over $81,250 of allowable credits included on Part II, line 38, Credit allowed for the current year. The excess, $78,750, is less than $100,000 of the credit for which an election is made, and so the net elective payment election amount is $78,750. For purposes of this example, XYZ can use all of its carryforward amount of $10,000 on line 38. As a result, the $10,000 of the general business credit carryforward and the remaining $21,250 of the energy credit and $50,000 of the work opportunity credit make up the Part II, line 38, Credit allowed for the current year. XYZ enters $78,750 on line 4a, column (i) of Part III. This net elective payment election amount is also reported on the designated line of XYZ’s return. See the instructions for line 6 of Part III, column (h) and (i), below. Column (j), Combine columns (e), (f), and (g), less column (i). If you are a partnership or S corporation that only transferred a portion of any eligible credit, report the non-transferred portion shown in column (j) on the applicable line of your Schedules K and K-1. See the Instructions for Forms 1065 and 1120-S for reporting codes of the specific credit. Limitation on Certain Credits Reported in Part III The aggregate amount from each credit form is usually reported on the appropriate line of Form 3800, Part III, to reflect self-generated credit sources and all pass-through entity sources. However, certain credits have limitations imposed. They include: Form 3468, Part VI, Section F, line 11c—$4,000 limitation for qualified small wind energy property (reported on Part III, line 4a); Form 8826, line 8—$5,000 limitation for the overall credit (reported on Part III, line 1e); and Form 8882, line 7—$150,000 limitation for the overall credit (reported on Part III, line 1k). In situations where there is a limitation on the credit amount, the limited amount allowed is allocated pro rata and anything above the limitation is lost. Lines 1a, 1d, 1o, 4a, and 4k 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 Part I, line 6, or Part II, line 36, in excess of Part II, line 16 or line 29, respectively. While any excess is allocated to patrons, any credit recapture applies as if you, as the cooperative, had claimed the entire credit. Note. Any carryforward of the qualifying therapeutic discovery project credit may be claimed on Part IV, line 2w. Lines 1c and 4i A qualified small business must complete Form 3800 before completing Section D of Form 6765 if the payroll tax credit is being claimed. See the Instructions for Form 6765 for more details. Eligible small businesses, enter your research credit on line 4i. See the definition of eligible small business , earlier. All others, enter your research credit on line 1c. Partners and S corporation shareholders, see Treatment of partners and S corporation shareholders under Eligible Small Business, earlier. Research credit limitation. If you are an individual, the amount of the research credit that may be included on Part III, line 1c or line 4i, is limited to the amount of tax attributable to your taxable income from the sole proprietorship or your interest in the pass-through entity (partnership, S corporation, estate, or trust) generating the credit. Figure the research credit limitation separately for each sole proprietorship or pass-through entity by using the following formula. Taxable income attributable to the sole proprietorship or your interest in the pass-through entity Line 11 × Your taxable income for the year The sum of the fractions used for determining the limits can't exceed 1. The research credit used to determine the limitation is the sum of the current year credit (determined without regard to the limitation), any carryforwards (adjusted for any payroll tax credit claimed) of the credit not used in prior years, and any carryback of the credit from 2024. For information on how to figure your taxable income for the year, your taxable income attributable to the sole proprietorship, or your interest in the pass-through entity, see Regulations sections 1.41-7(c) and 1.53-3. If in the current tax year you had no taxable income attributable to a particular business interest, you can't claim any research credit this year related to that business. If any of your research credit isn't allowed to be used because of this limitation, see Carryback and Carryforward of Unused Credit, earlier. Line 1e When reporting the disabled access credit from Form 8826 on Part III, line 1e, don't enter more than $5,000. Line 1f Cooperatives, estates, and trusts, enter the applicable part of the amount from Form 8835, Part II, line 17. All others, enter the applicable part of the amount from Form 8835, Part II, line 15. Don't enter an amount from Form 8835 that is included on Form 3800, Part III, line 4e. Line 1k When reporting the credit for employer-provided childcare facilities and services from Form 8882 on Part III, line 1k, don't enter more than $150,000. Line 1bb Enter the amount from Form 8904, Credit for Oil and Gas Production from Marginal Wells, line 8, or from the applicable line of your Schedule K-1. See the Instructions for Form 8904 for more information. Line 1ff Enter the amount from Form 8864, Biodiesel, Renewable Diesel, or Sustainable Aviation Fuels Credit, line 8. Lines 4a Through 4z Enter the amount of the specified credit on the applicable line. See also the instructions for lines 1c and 4i, earlier. Line 4h Tax-exempt eligible small employers, other than certain farmers' cooperatives, don't report the credit for small employer health insurance premiums on Part III, line 4h. Eligible tax-exempt small employers will report this credit on Form 990-T. Line 6, column (g) If you are a partnership or S corporation that received eligible credit(s) from transferor(s) under a section 6418 election, report the positive amounts included in the total of line 6, column (g) on Schedules K and K-1. See the instructions for Form 1065 and Form 1120-S for the information that you must provide to your partners or shareholders to report their distributive shares of such credits on their Forms 3800 attached to their income tax returns. Partners and shareholders enter the distributive share of each transferred credit on the applicable line of their Form 3800, Part III. Line 6, column (h) Partnerships and S corporations report the total elective payment election amount from Part III, line 6, column (h), on the designated line of your return, shown below. See also the instructions for Forms 1065 and 1120-S for additional reporting information. Form 1120-S, U.S. Income Tax Return for an S Corporation, line 24d. Form 1065, U.S. Return of Partnership Income, line 29. A taxpayer reporting an amount on Form 990-T that doesn’t have UBTI does not need to complete Part I and Part II. Copy the amount from column (h) to column (i). Line 6, column (i) If you are required to complete Parts I and II of Form 3800 to determine the general business credit(s) allowed for the current year (if any), report the total net elective payment amount from Part III, line 6, column (i), on the designated line of your return shown below. Form 1120, U.S. Corporation Income Tax Return, Schedule J, line 22. Form 1120-F, U.S. Income Tax Return of a Foreign Corporation, line 5j. Form 1120-L, U.S. Life Insurance Company Income Tax Return, line 27i. Form 1120-H, U.S. Income Tax Return for Homeowners Associations, line 23f. Form 1120-POL, U.S. Income Tax Return for Certain Political Organizations, line 23d. Form 1120-C, U.S. Income Tax Return for Cooperative Associations, line 30i. Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return, line 15g. Form 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies, line 28h. Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts, line 25h. Form 1041, U.S. Income Tax Return for Estates and Trusts, Schedule G, line 18a. Form 1041-N, U.S. Income Tax Return for Electing Alaska Native Settlement Trusts, line 19. Form 1041-QFT, U.S. Income Tax Return for Qualified Funeral Trusts, line 18. Form 990-T, Exempt Organization Business Income Tax Return, Part III, line 6g. Form 1040, U.S. Individual Income Tax Return, Schedule 3, line 13c. Part IV. Carryovers of General Business Credits (GBCs) or Eligible Small Business Credits (ESBCs) Use Parts IV and VI to record the carryforwards and carrybacks as shown in your business records before application of the credits to the current year tax. The information on Parts IV and VI comes from your tax returns and schedules for prior years (and subsequent year, for carrybacks). These include Form 3800, Schedules K-1, and your related work papers. If you checked the boxes on Part I, line 4, and Part II, line 34, you must attach the required statement, discussed next. See Carryback and Carryforward of Unused Credit , earlier. Required statement. For each credit, attach a statement with the following information. Show the tax year in which the credit originated, the amount of the credit as reported on the original return, and the amount allowed for that year. Also, state whether the total carryforward amount was changed from the originally reported amount and identify the type of credit(s) involved. If the revised carryforward amount relates to unused additional research credits, attach an additional statement detailing the changes to the originally reported Form 6765 information for all originating credit years applicable. For each carryback year, show the year and the amount of the credit allowed after you applied the carryback. For each carryforward year, show the year and the amount of the credit carryforward allowed for that year. Note. Individuals claiming the research credit from a sole proprietorship or pass-through entity don't include any carryforward of that credit on Part I, line 4, before figuring the limitation on Part III, line 1c. Include the carryforward when figuring the research credit limitation on line 1c of Part III. Then, include the allowable carryforward amount on Part I, line 4, and attach the statement required above. Adjustment for the payroll tax credit. A qualified small business that elected on Form 6765 to claim a portion of its research credit as a payroll tax credit must reduce its research credit carryforward by the amount elected as a payroll tax credit. Column (a), Credits carried over to tax year 2023. This column lists the credits from prior years (or subsequent year, for carrybacks). Keywords from the credit title are provided in parentheses. See the credit form for the complete name and description of the credit. Column (b), Check if non-passive. Check the box if the credit is non-passive based on your level of participation. Column (c), Year. Enter the earliest year. Column (d), Pass-through entity EIN. If the credit was allocated to you from a pass-through entity, enter the EIN of the pass-through entity. If multiple pass-through entities are listed for the credit in Part VI, enter the EIN of the entity allocating the greatest amount of the credit to you. Column (e), Credit carrybacks to current year. This column is used when Form 3800 is being submitted with an amended return. Enter the amount carried back from a subsequent year to the year for which you are filing the amended return. In general, no part of the unused credit for any year attributable to any credit can be carried back to any tax year before the first tax year for which that credit was first allowable. See Carryback and Carryforward of Unused Credit , earlier. Column (f), Carryforwards (excluding ESBCs). Include in this column carryforwards from all prior years, excluding ESBCs. Column (g), ESBC carryforwards. Include in this column only carryforwards of ESBCs claimed under former section 38(c) for tax year 2010. Line 1. Lines 1a through 1ff list the same credits shown on Part III, lines 1a through 1ff. Carryforward of certain other credits. Use new Part IV, line 1zz, to enter any carryforward to 2023 of any unused credit from the general business credits no longer listed on Form 3800 due to, for example, expiration of a tax provision. The pre-2008 section 42 low-income housing credit should be reported on Part IV, line 2b. The pre-2008 section 47 rehabilitation credit should be reported on Part IV, line 2yy. Note. If a carryforward amount is entered on Part IV, line 1zz, see the instructions for Part I, line 4, for the statement to attach. If any carryforward amount is entered on Part IV, lines 1a through 1zz, see Required Statement, earlier. Line 2. Lines 2a through 2w are for expired credits for which only carryforwards are allowed. Use line 2yy for the carryforward of any credit not listed for which only carryforwards are generally allowed, and write the name and form number of the credit on line 2yy in column (a). See Required Statement, earlier, if you revised any carryforwards on line 2. Line 3. This line is for carryforwards and carrybacks of the empowerment zone credit (Form 8844) and carryforwards of the renewal community employment credit. Line 4. Lines 4a through 4k are for carryforwards and carrybacks of specified credits identified in section 38(c)(4)(B). Part V. Breakdown of Aggregate Amounts in Part III for Facility-by-Facility, Multiple Pass-Through Entities, etc. If any of the amounts entered in Part III (aside from totals) are aggregate figures from more than 1 year or more than 1 pass-through entity, provide breakdowns of those figures by tax year and by the EIN of the pass-through entity, if applicable, in Part V. Use only the columns applicable for the particular credits you are reporting. If you elected payment or transferred a credit (or portion thereof) for a facility or property in Part III, enter the amounts and information (including the IRS-issued registration number) for each facility or property in columns (a), (b), (d), and (h) (if applicable). If you transferred a credit (or portion thereof) under section 6418, enter the amount in column (f) as a negative number. See Transfer of Eligible Credits Under Section 6418 , earlier. Transferees enter the amount of the transferred credit from the applicable line(s) of Part III as a positive number(s) in column (f), and enter relevant information provided by the transferor in columns (a), (b), (c), (d), and (e) (as applicable). You must also attach all transfer election information provided by the transferor to take into account your transferred credits in Part I and Part II of Form 3800. See Transfer of Eligible Credits Under Section 6418 , earlier. Part VI. Breakdown of Aggregate Amounts in Part IV If any of the amounts entered in Part IV (aside from totals) are aggregate figures from more than 1 year or more than 1 pass-through entity, provide breakdowns of those figures by tax year and by the EIN of the pass-through entity, if applicable, in Part VI. Use only the columns applicable for the particular credits you are reporting. Instructions for Form 3800 - Notices 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. 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 30 hr., 51 min. Learning about the law or the form 1 hr. Preparing and sending the form to the IRS 1 hr., 32 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.
