Department of the Treasury 2004 Internal Revenue Service

Instructions for Form

1099-PATR

Section references are to the Internal Revenue Code unless otherwise noted.

A Change To Note Box 1. Patronage Dividends

Enter the total patronage dividends paid in cash (qualified or The Jobs and Growth Tax Relief Reconciliation Act of 2003 “consent” checks), qualified written notices of allocation (face (Public Law 108-27) reduced the backup withholding rate to amount), and other property (except nonqualified written notices 28% on amounts paid after December 31, 2002. of allocation).

An Item To Note Box 2. Nonpatronage Distributions

In addition to these specific instructions, you should also use This box applies only to farmers’ cooperatives exempt from tax

the 2004 General Instructions for Forms 1099, 1098, 5498, under section 521. Enter the total nonpatronage distributions

and W-2G. Those general instructions include information paid in cash (qualified or “consent” checks), qualified written

about: notices of allocation (face amount), and other property. Do not • Backup withholding include nonqualified written notices of allocation. • Magnetic media and electronic reporting requirements Box 3. Per-Unit Retain Allocations • Penalties

• Who must file (nominee/middleman) Enter the total per-unit retain allocations paid in cash, qualified

• When and where to file per-unit retain certificates (face amount), and other property.

• Taxpayer identification numbers Box 4. Federal Income Tax Withheld • Statements to recipients Enter backup withholding. For example, persons who have not • Corrected and void returns furnished their TIN to you in the manner required are subject to • Other general topics withholding at a 28% rate on payments required to be reported You can get the general instructions from the IRS website at in boxes 1, 2, 3, and 5 to the extent such payments are in cash www.irs.gov or by calling 1-800-TAX-FORM (1-800-829-3676). or qualified check. See Regulations section 31.3406(b)(2)-5 for

more information on backup withholding by cooperatives.

Specific Instructions for Form Box 5. Redemption of Nonqualified Notices and

1099-PATR Retain Allocations

For farmers’ cooperatives qualifying under section 521 only, File Form 1099-PATR, Taxable Distributions Received From

Cooperatives, for each person to whom the cooperative has enter all redemptions of nonqualified written notices of

allocation issued as patronage dividends or nonqualified written paid at least $10 in patronage dividends and other distributions notices of allocation issued as nonpatronage allocations. Also described in section 6044(b) or from whom you withheld any enter nonqualified per-unit retain certificates issued with respect Federal income tax under the backup withholding rules to marketing. regardless of the amount of the payment. A cooperative

determined to be primarily engaged in the retail sale of goods or Pass-Through Credits services that are generally for personal, living, or family use of Report in the appropriate boxes the patron’s share of unused the members may ask for and receive exemption from filing credits that the cooperative is passing through to the patron. Form 1099-PATR. See Form 3491, Consumer Cooperative

Exemption Application, for information about how to apply for Box 6. (Certain Credits)

this exemption. Report dividends paid on a cooperative’s capital For the patron, state separately in box 6 (or in the blank box stock on Form 1099-DIV, Dividends and Distributions. below boxes 8 and 9 if more than one credit applies) the type

Exceptions. Generally, you are not required to file Form and amount of each of the following credits:

1099-PATR for payments made to a corporation, a tax-exempt • The empowerment zone and renewal community

organization, the United States, a state, a possession, or the employment credit (Form 8844).

District of Columbia. See Regulations section 1.6044-3(c). • The Indian employment credit (Form 8845).

• The welfare-to-work credit (Form 8861). Statements to Recipients • The New York Liberty Zone business employee credit (Form If you are required to file Form 1099-PATR, you must provide a 8884) for wages paid during 2002 or 2003. statement to the recipient. For more information about the Box 7. Investment Credit requirement to furnish an official form or acceptable substitute

statement to recipients in person, by statement mailing, or Enter the total investment credit for the patron.

electronically, see part H in the 2004 General Instructions for Box 8. Work Opportunity Credit Forms 1099, 1098, 5498, and W-2G. Enter the total work opportunity credit for the patron. Do not 2nd TIN Not. include the New York Liberty Zone business employee credit on

You may enter an “X” in this box if you were notified by the IRS line 8; instead, include it on line 6.

twice within 3 calendar years that the payee provided an Box 9. Patron’s AMT Adjustment incorrect taxpayer identification number (TIN). If you mark this

box, the IRS will not send you any further notices about this Enter the total alternative minimum tax (AMT) patronage

account. dividend adjustment for the patron.

For more information on the TIN Matching System

offered by the IRS, see the 2004 General Instructions

for Forms 1099, 1098, 5498, and W-2G.

TIP

Cat. No. 27984F