Form 1128 (Rev. 8-84)

Page 4

SECTION D.—All Corporations Yes | No
1 Date of incorporation >»
2 Is the change being requested by a subsidiary who became a member of an affiliated group to join with the ® arent Mh
corporation in the filing of a consolidated return for the short period? . . .
If “Yes,” DO NOT FILE THIS FORM. SEE “EXCEPTIONS” IN GENERAL INSTRUCTION. B. Y

3 Isthe corporation a member of an affiliated group filing a consolidated return?
If “Yes,”’ attach a statement showing @) the name, address, identifying number used on the Consolidated return, the tax
year and the Internal Revenue Service Center where the taxpayer files the return; and (b) the name, address, and identify-
ing number of each member of the affiliated group. Designate the parent corporation ‘and the taxable income or (loss) of
each member for the 3 years before the short period.

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4 Did the corporation pay any dividends to its shareholders during the short period?
If “Yes,” furnish the following information:
(a) Taxable dividends .

ale

(b) Nontaxable dividends (explain t how determined)

SECTION E.—S Corporations

1_Date of election >

Attach a statement showing each shareholder's name, address, identifying number, tax year, percentage of ownership
and type of entity (e.g. individual, trust or qualified Subchapter S Trust as defined in section 1361(d)(3)).

3 Is the corporation a newly electing S corporation required to file Form 2553, Election *y a Small Business Corporation, to
adopt, retain or change its accounting period? . woe ee ee
If ‘Yes,”’ do not file this form. See “Exceptions” in General Instruction B.

te
_.

SECTION F.—Tax Exempt Organizations

Form of organization: [] Corporation [] Trust [] Other(Specify) >

Date of organization >

Code section under which you are recognized as exempt >

SS

Are you required to file an annual return on either Form 990, 990-C, 990-PF, 990-T, 1120-H, or 1120-POL? . .
Date exemption was granted Attach a copy of ruling letter granting exemption. If a copy of letter is not
available, attach explanation.

Ifa private foundation, is the foundation terminating its status under section 507?

A KPIWIN|S

SS

SECTION G.—Domestic International Sales Corporations

Date of election >

|

Attach a statement showing the name, address, identifying number, tax year, and the percentage of ownership of each
shareholder.

Signature—ALL FILERS (See specific instructions)

Under penalties of perjury, | declare that | have examined this application, including accompanying schedules and statements, and to the best of my knowledge and belief it is

true, correct, and complete. Declaration of preparer (other than applicant) is ‘on all information of which preparer has any knowledge.

U.S. Government Printing Office: 1987—181-447/40052


a . . . OMB No. 1545-0134
Form 1128 Application for Change in Accounting Period Expites 731.87
Scarce of the reasury > For Paperwork Reduction Act Notice, see page 1 of separate instructions.

Internal Revenue Service. File in triplicate.
‘Name of applicant (if joint return is filed, also show your spouse's name) Identifying number (See specific instructions) ‘Check one:
T individual
q ‘Address (Number and street) Service Center where return will be filed CO Partnership
A O Estate
1 City or town, State and ZIP code ‘Applicant's telephone number O trust
H ¢ ) CO Corporation
@| Name of person to contact Telephone number of contact person CO scorporation
i ) O osc
. . - 0 Cooperative
DO NOT FILE FORM 1128 if you meet any of the exceptions under General Instruction B. Sec. 1381(a))
DO NOT CHANGE YOUR TAX YEAR UNTIL THE COMMISSIONER HAS APPROVED YOUR REQUEST. 1 Tax Exempt
Organization
1 Controlled
SECTION A.—AIll Filers Foreign Corp.
1 Foreign Corp.
1 (a) Present tax year ends 1 (b) Permission is requested to change to a tax year ending
2 The period change will require a return for a short period 3 Nature of business or principal source of income
Beginning - Ending
19 H 119
(Continued on page 3)
MAKE NO ENTRIES BELOW—For Internal Revenue Service Use Only
Approval Disapproval (see page 2)

Gi oration Tax Branch Date oration Tax Branch Date
Person to Phone>  202- Internal Revenue Service
contact Symbols ® CC: Washington, D.C. 20224

Approval

Based solely upon the information furnished in this application, you are granted permission to make the requested change in the
accounting period indicated above, subject to the conditions checked below:

(You must file a return for the short period shown in this application by the due date of the return, including extensions, or, if later, within
30 days from the date of this approval. Attach a copy of this application to your return for the short period as authority for the change.

( Your books must be closed as of the last day of the new tax year. Returns for subsequent years must be made on the basis of a full 12-
months or 52-53 weeks ending on the last day of the new tax year. You must compute your income and keep your books and records
(including financial reports and statements for credit purposes) on the basis of the new tax year.

C Your taxable income for the short period must be annualized and the tax computed in accordance with the provisions of section 443(b)
and Regulations section 1.443-1(b).

CD In computing taxable income for the short period, accrual basis taxpayers must reduce any expense covering a 12-month period (such
as taxes, insurance, vacation pay, or similar expense) to an amount bearing the same ratio to the total expense as the number of months
in the short period bears to 12; and deduct one-sixth of that reduction each year of a 6-year period commencing with the first tax year
after the short period.

Note: This condition is not applicable if you have consistently deducted such expenses on the ratable accrual method for federal income
tax purposes.

(i If the short period required to effect the change of annual accounting period is a tax year in which you have a net operating loss, you
must deduct the net operating loss ratably over a 6-year period beginning with the first tax year after the short period unless you meet
one of the following exceptions:

(a) If the net operating loss resulting from the short period is $10,000 or less, the net operating loss can be carried back or carried over
in accordance with section 172(b); or

(b) If the net operating loss resulting from a short period of 9 months or longer is greater than $10,000 and is less than the net
operating loss for a full 12-month period beginning with the first day of the short period, the net operating loss can be carried back
or carried over in accordance with section 172(b).

C If you are filing for an S corporation that has a net operating loss as defined in section 172(c) for the short period, you are not allowed a
deduction from gross income of the shareholders as provided in section 1366 and 1367; but instead you must deduct one-sixth of the
ret operating loss as a business expense under section 162 each year of a 6-year period commencing with the first tax year after the
short period.

Form 1128 (Rev. 8-84)


Form 1128 (Rev. 8-84) Page 2

C1 Ifthere is an unused general business credit or any other credit for the short period, you must carry the unused credit(s) forward.
Unused credit(s) from the short period may not be carried back.

If the change in accounting period is for a corporation, the corporation may not make an election (under section 1362(a)) to be treated
as an S corporation, that would be effective for the tax year immediately following the short period.

If there is any change in partnership interest before the partnership files its short period return, the partnership must notify this office in
writing within 30 days of the change in interest.

ood

Any ordinary loss incurred for the short period must not create or increase a net operating loss available for carryback for any of the
following named partners:

Q) (2)

3)
1 Ifyou do not wish to comply with these conditions, please let us know within 30 days from the date on this application.

The accounting period approval granted in this ruling is directed only to the applicant who requested it and may not be used or cited as
precedent.

Disapproval
Your application cannot be approved because:
It was not filed on time. (See explanation
(__) Itwas dated
(__) Itwas received in an envelope postmarked_
It was prematurely filed. (See explanation

oO

below.)

_below.)

The reason given for adopting the tax year requested does not constitute a business purpose within the meaning of the Regulations.
(See explanation 4 below.)

The reason given for the change in the tax year requested is not a substantial business purpose under the Regulations. (See explanation
5 below.)
The information given does not establish that the tax year requested is the natural business year. (See explanation 6 below.)

The tax year requested would cause income to one or more of the partners or to the shareholders of an S corporation to be deferred
more than 3 months. (See explanation 7 below.)

O oO 0 00

Because it appears that you have been using an incorrect accounting period or the application involves returns already filed, or both, we
have forwarded the application to the Internal Revenue Service Center where you file your returns. Please contact the Service Center
about this matter.

o

We searched our records thoroughly, but could not locate your original application. Therefore, we cannot consider your request. (See
explanation 1 below.)

Oo

It is not necessary for this office to take action. You may adopt with your first return without obtaining prior approval from the
Commissioner of Internal Revenue, any tax year that meets the requirements of section 441. You must adopt your first tax year onor
before the due date (not including extensions) for filing the return for that tax year. You should file your return with the Service Center
for your area. (See Regulations section 1.441-1(b)(3). S Corporations see Temp. Regs. section 18.1378-1.)

EXPLANATION OF DISAPPROVAL

. Regulations section 1.442-1(b)(1) provides that, to secure prior approval of a change in annual accounting period, a taxpayer must
file the application by the 15th day of the second calendar month following the close of the short period.

. Regulations section 1.706-1(b)(4)(ii) provides that, where a newly formed partnership is required to obtain prior approval from the
Commissioner for the adoption of a tax year, the partnership must file the application by the last day of the month following the
close of the tax year to be adopted.

3. The application was filed too far in advance of the end of the short period. Please use the enclosed forms to make a new application
closer to the end of the short period, when more accurate information will be available.

4, Regulations section 1.706-1(b) provides that, generally, a partnership may not adopt a tax year other than that of all its principal
partners, unless it establishes to the satisfaction of the Commissioner that a business purpose exists for adopting such a year.

5. Regulations section 1.442-1(b)(1) provides that the taxpayer requesting a change in accounting period must establish that there is
a substantial business purpose for making the change.

6. (a) Regulations section 1.706-1(b) provides that if a newly formed partnership wishes to adopt a tax year other than a calendar
year where all of its principal partners are on different tax years, it must establish a business purpose for its adoption and obtain
prior approval from the Commissioner. Generally, the requirement of a business purpose will be met if the desired year
coincides with the partnership's natural business year. The tax year should end at, or soon after, the close of the peak business
period. (See Rev. Rul. 60-182, 1960-1 C.B. 264, and Rev. Proc. 74-33, 1974-2 C.B. 489.)

(b) Regulations section 1.442-1(b)(1) provides that the taxpayer requesting a change in accounting period must establish that
there is a substantial business purpose for making the change, and that in making its determination, the Internal Revenue
Service will consider the effect of the proposed change on the taxpayer’s annual business cycle. The tax year should end at, or
soon after, the close of the taxpayer's peak business period. (See Rev. Proc. 74-33.)

n

7. Rev. Proc. 72-51, 1972-2 C.B. 832, provides that a request by a partnership desiring to change to, or adopt, a tax year other than
that of all its principal partners generally will be approved only where the request for the adoption or change would result ina
deferment of income to the partners of three months or less. This Rev. Proc. is also applicable toa change in accounting period
requested by an S corporation.



Form 1128 (Rev. 8-84)

Page 3

SECTION A.—All Filers (continued)

Yes

4 What is your overall method of accounting? 0 Cash receipts and disbursements [1] Accrual
2 Other (explain):

5 Are you an individual requesting a change from a fiscal year to a calendar year under Rev. Proc. 66-50, 1966-2 C.B.
1260? . Fe

6 Are you requesting a ‘change fora trust under ‘Rev. Pros. 68. a1, 1968. 2 C. B. 943? .

7 Are you requesting a change for a tax exempt organization under Rev. Proc. 76-9, 1976-1 ro B. 347, or 176: 10, 1976 1
C.B. 548? : .

8 Are you requesting a ‘change fora corporation under Rev. Proc. a4. 34, 1984. 17 L R. 8. 24? .

IF “YES,"’ TO EITHER 5, 6, 7, or 8 ABOVE, FILE FORM 1128 WITH THE SERVICE CENTER.
SEE GENERAL INSTRUCTION C.

9 In the last 10 years have you changed or requested permission to change your accounting period, your overall method of
accounting or the accounting treatment of any item? . .
If “Yes,” and there was a ruling letter issued granting permission nto make the change, attach a a copy. it acopy yy of the ruling
letter is not available, explain and give date permission was granted.

10 Do you have pending any accounting method, accounting period, ruling or technical advice request in the National Office? .
If “Yes,” attach a statement explaining the type of request (method, period, etc.) and the specific issues involved in each
request.

11 Enter the taxable income* or (loss) for the three tax years immediately before the short period and for the short period. If
necessary, estimate the amount for the short period.
Third preceding year ‘Second preceding year First preceding year Short period
$ $ $ $

“Individuals enter adjusted gross income. Partnerships and S$ corporations enter ordinary income. Section 501(c)
organizations enter unrelated business taxable income.

12 Are you a member of a partnership, a beneficiary of a trust or estate, a shareholder of an S corporation, or a shareholder of
a Domestic International Sales Corporation (DISC)? .
If “Yes,"’ attach a statement showing the name, address, identifying number, tax year, ‘percentage of interest in capital
and profits, or percentage of interest of each DISC and the amount of income received from each partnership, trust,
estate, S corporation, or DISC for the first preceding year and the short period.

13 State the reasons for requesting the change. (Attach a separate sheet if you need more space.) /f you are requesting a
change to conform to your ‘‘natural business year,’ provide the information described in Rev. Proc. 74-33.

SECTION B.—Estates or Trusts

Attach a statement showing the following information:
1 Name, identifying number, address and tax year of each beneficiary and whether a beneficiary is also the grantor.
2 Based on the taxable income of the estate or trust entered in Section A, item 11, show the distribution deduction and the taxable
amounts distributable to each beneficiary for the 2 tax years immediately before the short period and for the short period.
3 Ifthe trust is a member of a common trust fund, show name and tax year of that fund.

4 Are you filing for a simple trust as defined in section 651? .
5 Are you filing for a complex trust as defined in section 661?

SECTION C.—Partnerships

1 Date business began. (See specific instructions for Section C.)_>

2 1s any partner applying for a corresponding change in accounting period?

3 Attach a statement showing each partner's name, type of partner (e.g. individual, partnership, estate, trust, corporation, $
corporation, DISC, etc.), address, identifying number, tax year, the percentage of interest in capital and profits, and how
the interest was acquired.

4 ls any partner of this partnership a member of a professional corporation as defined in section 269A? .
If “Yes,” attach a separate sheet providing the name, address, identifying number, tax year, percentage of interest in
capital and profits, and the amount of income received from each professional corporation for the first preceding year and
the short period.