1120-ND Instructions for Form 1120-ND

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Instructions for
Form 1120-ND

Department of the Treasury
Internal Revenue Service

(Rev. November 2018)

(Use with the October 2013 revision of Form 1120-ND)

DRAFT AS OF
September 12, 2018
Return for Nuclear Decommissioning Funds and Certain Related Persons
Section references are to the Internal Revenue Code
unless otherwise noted.

Future Developments

For the latest information about
developments affecting Form 1120-ND and
its instructions, such as legislation enacted
after they were published, go to IRS.gov/
Form1120ND.

What’s New
Address change for filling returns. The
filing address for Form 1120-ND has
changed. See Where To File, later.
Increase in penalty for failure to file. For
returns required to be filed after December
31, 2018, the minimum penalty for failure to
file a return that is over 60 days late has
increased to the smaller of the tax due or
$210. See Late filing of return, later.
NOL carryback eliminated. The 2-year
carryback rule will generally not apply to net
operating losses (NOLs) arising in tax years
ending after 2017. Exceptions apply to NOLs
for farmers and non-life insurance
companies. See section 172(b) as amended
by P.L. 115-97, section 13302.

General Instructions
Purpose of Form

Nuclear decommissioning funds use Form
1120-ND to report contributions received,
income earned, the administrative expenses
of operating the fund, and the tax on
modified gross income. The return is also
used to report the section 4951 initial taxes
on self-dealing.
Taxpayers, electing under section 468A,
are allowed deductions for amounts
contributed to a qualified fund, up to 100% of
the present value of the nuclear power
plant's decommissioning costs. Taxpayers
can apply for a new ruling amount if the
nuclear power plant is granted a license
renewal, extending its useful life. See section
468A for more information.

Who Must File

All section 468A nuclear decommissioning
funds must file Form 1120-ND. A disqualified
person engaging in self-dealing must file
Form 1120-ND to report the initial tax. See
Part II, Initial Taxes on Self-Dealing (Section
4951), later, to determine if an individual has
engaged in self-dealing as a trustee or
disqualified person.

Sep 12, 2018

Note. Each person liable for filing a return to
pay any tax reportable on this form must file
a separate return.

When To File

Generally, a fund must file its income tax
return by the 15th day of the 4th month after
the end of its tax year. The return of a trustee
or self-dealer who owes tax under section
4951 must be filed by the 15th day of the 4th
month after the end of the tax year of the
trustee or self-dealer.
However, a fund with a fiscal tax year
ending on June 30 must file by the 15th day
of the 3rd month after the end of its tax year.
A fund with a short tax year ending in June
will be treated as if the short year ended on
June 30, and must file by the 15th day of the
3rd month after the end of its tax year.

If the due date falls on a Saturday,
Sunday, or legal holiday, the fund may file on
the next business day.

Where To File

File the fund's or disqualified person's or
trustee's return at the applicable IRS address
listed below.
If the fund's principal business, office, or
agency is located in the United States, file
Form 1120-ND at the following address:
Department of the Treasury
Internal Revenue Service Center
Ogden, UT 84201-0012
If the fund's principal business, office, or
agency is located in a foreign country or a
U.S. possession, file Form 1120-ND at the
following address:
Internal Revenue Service Center
P.O. Box 409101
Ogden, UT 84409

Private delivery services. Funds can use
certain private delivery services designated
by the IRS to meet the timely mailing as
“timely filing/paying” rule for tax returns and
payments. See the Instructions for Form
1120, U.S. Corporation Income Tax Return,
for details.
Private delivery services cannot
deliver items to P.O. boxes. The
CAUTION fund must use the U.S. Postal
Service to mail any item to an IRS P.O. box
address.

!

Cat. No. 11508V

Extension of time to file. File Form 7004,
Application for Automatic Extension of Time
To File Certain Business Income Tax,
Information, and Other Returns, to request
an extension of time to file. Generally, file
Form 7004 by the regular due date of the
return.
A disqualified person or trustee filing to
report section 4951 taxes must also file Form
7004 to request an extension of time to file.

Who Must Sign

The return must be signed and dated by an
authorized trustee. The return of any person
who engaged in any act of self-dealing must
be signed and dated by that person or the
individual authorized to sign on behalf of that
person.
If an employee of the fund completes
Form 1120-ND, the paid preparer space
should remain blank. Anyone who prepares
Form 1120-ND but does not charge the fund
should not complete that section. Generally,
anyone who is paid to prepare the return
must sign it and fill in the “Paid Preparer Use
Only” area.
The paid preparer must complete the
required preparer information and:
• Sign the return in the space provided for
the preparer's signature.
• Give a copy of the return to the taxpayer.
Note. A paid preparer may sign original or
amended returns by rubber stamp,
mechanical device, or computer software
program.

Paid Preparer Authorization

If the fund wants to allow the IRS to discuss
its tax return with the paid preparer who
signed it, check the “Yes” box in the
signature area of the return. This
authorization applies only to the individual
whose signature appears in the “Paid
Preparer Use Only” section of the fund's
return. It does not apply to the firm, if any,
shown in that section.

If the “Yes” box is checked, the fund is
authorizing the IRS to call the paid preparer
to answer any questions that may arise
during the processing of its return. The fund
is also authorizing the paid preparer to:
• Give the IRS any information that is
missing from the return,
• Call the IRS for information about the
processing of the return or the status of any
related refund or payment(s), and

• Respond to certain IRS notices about
math errors, offsets, and return preparation.
The fund is not authorizing the paid
preparer to receive any refund check, bind
the fund to anything (including any additional
tax liability), or otherwise represent the fund
before the IRS.
The authorization will automatically end
no later than the due date (excluding
extensions) for filing the fund's subsequent
tax return. If the fund wants to expand the
paid preparer's authorization or revoke
authorization before it ends, see Pub. 947,
Practice Before the IRS and Power of
Attorney.

fund uses a third party to make deposits on
its behalf, they may have different cutoff
times.
Same-day wire payment option. If the
fund fails to submit a deposit transaction on
EFTPS by 8 p.m. Eastern time the day
before the date a deposit is due, it can still
make its deposit on time by using the
Federal Tax Collection Service (FTCS).To
use the same-day payment method, the fund
will need to make arrangements with its
financial institution ahead of time regarding
availability, deadlines, and costs. Financial
institutions may charge a fee for payments
made this way. To learn more about the
information the fund will need to provide to
its financial institution to make a same-day
wire payment, visit the IRS website at
IRS.gov/SameDayWire.

Late payment of tax. A fund that doesn’t
pay the tax when due generally may be
penalized 1/2 of 1% of the unpaid tax for
each month or part of a month the tax is not
paid, up to a maximum of 25% of the unpaid
tax. The penalty won’t be imposed if the fund
can show that the failure to pay on time was
due to reasonable cause.

DRAFT AS OF
September 12, 2018
Assembling the Return

To ensure that the fund's tax return is
correctly processed, attach all schedules
after page 2, Form 1120-ND, in alphabetical
order followed by other forms in numerical
order.

Complete every applicable entry space
on Form 1120-ND. Do not write “See
Attached” instead of completing the entry
spaces. If more space is needed on the
forms or schedules, attach separate sheets
using the same size and format as the
printed forms. If there are supporting
statements and attachments, arrange them
in the same order as the schedules or forms
they support and attach them last. Show the
totals on the printed forms. Enter the fund's
name and employer identification number
(EIN) on each supporting statement or
attachment.

Tax Payments

The fund must pay the tax due in full no later
than the due date for filing its tax return (not
including extensions).

Electronic Deposit
Requirement

Nuclear decommissioning funds must use
electronic funds transfers to make all federal
tax deposits (such as deposits of
employment, excise, and corporate income
tax). Generally, electronic funds transfers are
made using the Electronic Federal Tax
Payment System (EFTPS). However, if the
fund does not want to use EFTPS, it can
arrange for its tax professional, financial
institution, payroll service, or other trusted
third party to make deposits on its behalf.
Also, it may arrange for its financial institution
to submit a same-day tax wire payment
(discussed below) on its behalf. EFTPS is a
free service provided by the Department of
the Treasury. Services provided by a tax
professional, financial institution, payroll
service, or other third party may have a fee.
To get more information about EFTPS or
to enroll in EFTPS, visit EFTPS.gov or call
1-800-555-4477 (TTY/TDD
1-800-733-4829).

Depositing on time. For any deposit made
by EFTPS to be on time, the fund must
submit the deposit by 8 p.m. Eastern time the
day before the date the deposit is due. If the

Estimated Tax Payments

Generally, the following rules apply to the
fund's payments of estimated tax.
• The fund must make installment
payments of estimated tax if it expects its
total tax for the year (less applicable credits)
to be $500 or more.
• The installments are due by the 15th day
of the 4th, 6th, 9th, and 12th months of the
tax year. If any date falls on a Saturday,
Sunday, or legal holiday, the installment is
due on the next regular business day.
• The fund must use electronic funds
transfers to make installment payments of
estimated tax.
• Figure the fund's expected modified gross
income for the tax year. Then multiply the
fund's expected modified gross income by
20% and use Form 1120-W, Estimated Tax
for Corporations, as a worksheet to compute
estimated tax. See the Instructions for Form
1120-W.
• If the fund overpaid estimated tax, it may
be able to get a quick refund by filing Form
4466, Corporation Application for Quick
Refund of Overpayment of Estimated Tax.
For more information on estimated tax
payments, see the instructions for line 15,
later.

Interest and Penalties
Interest. Interest is charged on taxes paid
late even if an extension of time to file is
granted. Interest is also charged on penalties
imposed for failure to file, negligence, fraud,
substantial valuation misstatements,
substantial understatements of tax, and
reportable transaction understatements from
the due date (including extensions) to the
date of payment. The interest charge is
figured at a rate determined under section
6621.
Late filing of return. A fund that doesn’t file
its tax return by the due date, including
extensions, may be penalized 5% of the
unpaid tax for each month or part of a month
the return is late, up to a maximum of 25% of
the unpaid tax. The minimum penalty for a
return that is over 60 days late is the smaller
of the tax due or $210. The penalty won’t be
imposed if the fund can show that the failure
to file on time was due to reasonable cause.
-2-

Reasonable cause determinations. If the
fund receives a notice about penalties after it
files its return, send the IRS an explanation,
and we will determine if the fund meets the
reasonable cause criteria. Do not attach an
explanation when the fund files its return.

Other penalties. Other penalties can be
imposed for negligence, substantial
understatement of tax, reportable transaction
understatements, and fraud. See sections
6662, 6662A, and 6663.

Accounting Method

The fund must use the same method of
accounting as the electing taxpayer.

Rounding Off to Whole Dollars

The fund may round off cents to whole
dollars on its return and schedules. If the
fund does round to whole dollars, it must
round all amounts. To round, drop amounts
under 50 cents and increase amounts from
50 to 99 cents to the next dollar. For
example, $1.39 becomes $1 and $2.50
becomes $3.
If two or more amounts must be added to
figure the amount to enter on a line, include
cents when adding the amounts and round
off only the total.

Recordkeeping

Keep the fund's records for as long as they
may be needed for the administration of any
provision of the Internal Revenue Code.
Usually, records that support an item of
income, deduction, or credit on the return
must be kept for 3 years from the date the
return is due or filed, whichever is later. Keep
records that verify the fund's basis in
property for as long as they are needed to
figure the basis of the original or replacement
property.
The fund should keep copies of all filed
returns. They help in preparing future and
amended returns.

Additional Information

See the instructions for Form 1120 and Pub.
542, Corporations, for more information
about corporations, including additional
forms the fund may need to file and how to
get forms and publications.

Specific Instructions
Period Covered

Enter the tax year in the space provided at
the top of the form. For a calendar year,
enter the last two digits of the calendar year
in the first entry space. For a fiscal tax year
return, fill in the tax year space at the top of
the form.

Name and Address

Enter the fund's true name (as set forth in the
charter or other legal document creating it),
address, and EIN on the appropriate lines.
Enter the address of the fund's principal
office or place of business. Include the suite,
room, or other unit number after the street
address. If the post office does not deliver
mail to the street address and the fund has a
P.O. box, show the box number instead.

1. When filed to report the income,
deductions, and income tax liability of the
fund, check the “Fund” box.
2. When filed by a trustee who is liable
for taxes under section 4951, check the
“Trustee” box.
3. When filed by a disqualified person
who is liable for section 4951 tax, check the
“Disqualified person” box.

Line 6. Taxes. Enter deductible taxes paid
or incurred during the tax year, including
state and local income taxes. Do not deduct
federal income taxes or taxes not imposed
on the fund.
Line 8. Other deductions. Attach a
schedule listing by type and amount all
allowable deductions that are not deducted
elsewhere on Form 1120-ND. Include
investment advisory fees, actuarial
expenses, and other administrative
expenses paid or incurred during the tax
year, but do not include decommissioning
costs.

DRAFT AS OF
September 12, 2018
Note. Do not use the address of the
registered agent for the state in which the
fund is incorporated. For example, if a fund is
incorporated in Delaware or Nevada and the
fund's principal office is located in Little
Rock, AR, the fund should enter the Little
Rock address.
If the return is filed by a trustee or
disqualified person to report section 4951
taxes, enter that person's name and address
in the address section.
If the fund receives its mail in care of a
third party (such as an accountant or an
attorney), enter on the street address line
“C/O” followed by the third party's name and
street address or P.O. box.
If the corporation has a foreign address,
include the city or town, state or province,
country, and foreign postal code. Do not
abbreviate the country name. Follow the
country's practice for entering the name of
the state or province and postal code.

Item A. Employer Identification
Number (EIN)

Enter the fund's EIN. If the fund does not
have an EIN, it must apply for one. An EIN
can be applied for:
• Online — Click on the EIN link IRS.gov/
EIN. The EIN is issued immediately once the
application information is validated.
• By mailing or faxing Form SS-4,
Application for Employer Identification
Number.
If the fund has not received its EIN by the
time the return is due, write “Applied for” and
the date the fund applied in the space for the
EIN. For more details, see the Instructions
for Form SS-4.

Item B. Identifying Number of
Trustee or Disqualified Person

If the return is filed by a trustee or
disqualified person to report section 4951
taxes, enter the identifying number of the
trustee or disqualified person. For an
individual trustee or disqualified person,
enter the individual's social security number.
If the trustee or disqualified person is not an
individual, enter the EIN.
Note. Do not complete item B if Form
1120-ND is filed to report the income,
deductions, and income tax liability of the
fund.

Item C. Fund, Trustee, or
Disqualified Person

Item D. Final Return, Name
Change, Address Change, or
Amended Return

Indicate a final return, name change,
address change, or amended return by
checking the appropriate box. If you are a
trustee or disqualified person reporting
section 4951 taxes, omit item D.

Note. If a change in address occurs after
the return is filed, use Form 8822-B, Change
of Address or Responsible Party – Business,
to notify the IRS of the new address. See the
Instructions for Form 8822-B for details.

Part I. Computation of Fund
Income Tax
Income
Line 1. Taxable interest. Enter the total
taxable interest income received or accrued
for the year, including any original issue
discount. Do not include tax-exempt interest
on line 1; but report it as an item of
information on Schedule M, line 2d.
Line 2. Capital gain net income. Every
sale, exchange, or actual or deemed
distribution of assets held by the fund must
be reported in detail on Schedule D (Form
1120), Capital Gains and Losses (and Form
8949, Sales and Other Dispositions of
Capital Assets, if applicable), even if there is
no gain or loss. The amount realized on an
actual or deemed distribution is the fair
market value of the assets as of the date of
distribution.
Line 3. Other income. Enter any other
taxable income not reported on line 1 or
line 2 and explain its nature on an attached
schedule. If the fund had only one item of
other income, describe it in parentheses on
line 3.

Deductions
Note. A deduction is not allowed for certain
expenses allocable to tax-exempt income.
See section 265. In addition, a deduction is
not allowed for distributions made to electing
taxpayers. Report such payments as an item
of information on Schedule M, line 2c.
Liabilities are not treated as incurred prior to
the time economic performance takes place.
See section 461(h).
Line 5. Trustee fees. Enter the total
deductible fees paid or incurred to the
trustee(s) for administering the fund during
the tax year.

Check only the box that applies.

-3-

Line 11. Net operating loss deduction.
Enter the amount of any net operating loss
deduction allowed by Regulations section
1.468A-4(b)(4), and explain its computation
on an attached schedule.

Note. The 2-year carryback rule does not
apply to net operating losses arising in tax
years ending after 2017. An exception
applies to farmers and non-life insurance
companies. See section 172(b) as amended
by P.L. 115-97, section 13302.

Line 14. Payments. Generally, no
payments are allowed other than those on
lines 14a through 14d and the credit for
backup withholding.
Backup withholding. If the fund had
federal income tax withheld from any
payments it received because, for example,
it failed to give the payer its correct EIN,
include the amount withheld in the total for
line 14f. Write the amount withheld and the
words “Backup Withholding” in the blank
space above line 14f.
Line 15. Estimated tax penalty. A fund
that does not make estimated tax payments
when due may be subject to an
underpayment penalty for the period of
underpayment. Use Form 2220,
Underpayment of Estimated Tax by
Corporations, to see if the fund owes a
penalty and to figure the amount of the
penalty. If Form 2220 is attached, check the
box on line 15 and enter the amount of the
penalty on that line.

Schedule L. Balance Sheets

The balance sheets should agree with the
fund's books and records.

Schedule M. Other Information
Line 1. The term “electing taxpayer” means
an eligible taxpayer that elects the
application of section 468A to deduct
payments made to a nuclear
decommissioning fund. See Regulations
section 1.468A-7 for the rules concerning the
election.
Line 5. If you are a trustee or disqualified
person (defined later), complete the items
included in line 5 to determine if you have
engaged in an act of self-dealing.

Part II. Initial Taxes on
Self-Dealing (Section 4951)
Initial taxes on self-dealers
An initial tax of 10% of the amount involved
(defined later) is imposed on each act of
self-dealing between a disqualified person
and a nuclear decommissioning fund for
each tax year (or part of a tax year) in the
taxable period. The tax is required to be paid
by any disqualified person (other than a
trustee acting only as a trustee of the trust)
who participates in the act of self-dealing.

4. The payment of amounts remaining in
the fund to the electing taxpayer after the
termination of the fund upon the substantial
completion of decommissioning.
5. The furnishing of goods, services, or
facilities by a disqualified person to the fund
if the furnishing is without charge and if the
goods, services, or facilities so furnished are
exclusively used for the purposes specified
in section 468A(e)(4).
6. The payment of compensation (and
the payment or reimbursement of expenses)
by the fund to a disqualified person for
personal services that are reasonable and
necessary to carry out the purposes of the
fund and the compensation (or payment or
reimbursement of expenses) is not
excessive.
7. A payment by the fund for the
performance of trust functions and certain
general banking services by a bank or trust
company that is a disqualified person, if the
banking services are reasonable and
necessary to carry out the purposes of the
fund and the compensation paid to the bank
or trust company is not excessive
(considering the fair market interest rate for
the use of the funds by the bank or trust
company).

have been if the disqualified person acted
under the highest fiduciary relationship.
Disqualified person. The term “disqualified
person” means a person who is:
1. A contributor to the fund.
2. A trustee of the fund.
3. An owner of more than 10% of (a) the
total combined voting power of a
corporation, (b) the profits interest of a
partnership, or (c) the beneficial interest of a
trust or unincorporated business that is a
contributor to the fund.
4. An officer, director, or employee of a
person who is a contributor to the fund.
5. The spouse, ancestor, or a lineal
descendant, or a spouse of a lineal
descendant of an individual described in (1)
through (4) above.
6. A corporation of which persons
described in (1) through (5) above own more
than 35% of the total combined voting
power.
7. A partnership of which persons
described in (1) through (5) above own more
than 35% of the profits interests.
8. A trust or estate of which persons
described in (1) through (5) above own more
than 35% of the beneficial interest.

DRAFT AS OF
September 12, 2018
Initial taxes on trustee

A tax of 21/2% of the amount involved is
imposed on a trustee who participates in the
act of self-dealing. The tax is not imposed if
the trustee unwillingly or due to reasonable
cause participated in the act. The tax is
computed on all acts of self-dealing that
occur within the taxable period. The tax is
required to be paid by the trustee who
participates in the act.
Exceptions. The initial tax on the act of
self-dealing of a disqualified person or a
trustee is not imposed if the acts of
self-dealing are corrected within the taxable
period.

Definitions
Self-dealing. When determining if an act is
an act of self-dealing, treat the transfer of
personal property by a disqualified person to
the fund as a sale or exchange if the property
is subject to a mortgage or similar lien.
Otherwise, the term “self-dealing” means any
direct or indirect:
• Sale, exchange, or leasing of real or
personal property between the fund and a
disqualified person;
• Lending of money or other extensions of
credit between the fund and a disqualified
person;
• Furnishing of goods, services, or facilities
between the fund and a disqualified person;
• Payment of compensation (or payment or
reimbursement of expenses) by the fund to a
disqualified person; and
• Transfers to, or use by or for the benefit
of, a disqualified person of the income or
assets of the fund.
Exceptions. Acts of self-dealing do not
include:
1. The payment by the fund for the
purposes of satisfying, in whole or in part, the
liability of the electing taxpayer for
decommissioning costs of the nuclear power
plant.
2. The withdrawal of excess
contributions by the electing taxpayer in
accordance with Regulations section
1.468A-5(c)(2).
3. The withdrawal of amounts that have
been treated as distributions to the electing
taxpayer under Regulations section
1.468A-5(c)(3).

The allowable general banking services
are:
• Checking accounts, as long as the bank
does not charge interest on any
overwithdrawals;
• Savings accounts, as long as the fund
may withdraw its money after giving no more
than 30 days notice, without losing interest
for the period the money was on deposit; and
• Safekeeping activities (for example, rental
of a safe deposit box).
Taxable period. For an act of self-dealing,
the term “taxable period” means the period
beginning on the date of the act of
self-dealing and ending on the date of the
earliest of—
• The date of mailing of a notice of
deficiency under section 6212 for the section
4951 tax,
• The date on which the tax imposed by
section 4951 is assessed, or
• The date correction of the act of
self-dealing is completed.
Amount involved. The term “amount
involved” means the greater of the amount of
money given (or received) and the fair
market value of the other property given (or
received). When services described in
section 4951(d)(2)(C) are involved, the
amount involved is only the excess
compensation.
Note. Fair market value is determined as of
the date on which the act of self-dealing
occurs and at the highest market value
during the taxable period.
Correction and correct. The terms
“correction” and “correct” mean the undoing
of an act of self-dealing, to the extent
possible, but in any case returning the fund
to a financial position no worse than it would
-4-

For purposes of (3a) and (6) above,
indirect stockholders would be taken into
account under section 267(c), except that,
for purposes of this paragraph, section
267(c)(4) will be treated as providing that the
members of the family of an individual are
only those individuals described in (5)
above. For purposes of (3a), (3c), (7), and
(8) above, the ownership of profits or
beneficial interests will be determined by the
rules of constructive ownership of stock
provided in section 267(c) (other than
paragraph (3) thereof), except that section
267(c)(4) will be treated as providing that the
members of the family of an individual are
only those individuals described in (5)
above.

Dispositions of an Interest in a
Nuclear Power Plant
There are federal income tax consequences
when there is a transfer of assets of a
nuclear decommissioning fund in connection
with the sale, exchange, or other disposition
of a transferor of all or a portion of its
qualifying interest in a nuclear power plant to
another taxpayer (transferee). If the
requirements of Regulations section
1.468A-6(b) are met, the federal income tax
consequences are the following:
1. No gain or loss. If there is a
disposition of an interest (wholly or partially)
in a nuclear power plant, neither the
transferor or the transferee (or either's fund)
will recognize gain, loss, or otherwise take
any income or deduction into account
because of the transfer of all or some of the
assets of the transferor's fund. Also, the
transfer is not considered a payment or

contribution of assets by the transferor's fund
(or by the transferee to its fund).
2. Basis. Transfers of assets of a fund
to which Regulations section 1.468A-6
applies do not affect basis. The transferee's
fund will have a basis in the assets received
from the transferor equal to the transferor's
basis in those assets immediately prior to the
transfer.
3. Tax year of disposition.
A. Transferee. If a transferee does not file
a request for a schedule of ruling amounts by
the deemed payment deadline (21/2 months
after the end of the tax year of the
disposition), the transferee's ruling amount
for the interest acquired is determined by
taking the amount contained in the
transferor's current schedule of ruling
amounts for that tax year and that plant
multiplied by the product of:
(1) The portion of the transferor's
qualifying interest that is transferred, and
(2) A fraction, the numerator of which is
the number of days in the tax year of the
transferor including and following the date of
the disposition, and the denominator of
which is the number of days in that tax year.
B.Transferor. If a transferor does not file a
request for a revised schedule of ruling
amounts on or before the deemed payment
deadline for the tax year of the transferor in
which the disposition of its interest in the
nuclear power plant occurred (that is, the
date that is 21/2 months after the close of that
tax year), the transferor's ruling amount with
respect to that plant for that year will equal
the sum of:
(1) The ruling amount contained in the
transferor's current schedule of ruling
amounts with respect to that plant for that tax
year multiplied by the portion of qualifying
interest that is retained, if any, and
(2) The ruling amount contained in the
transferor's current schedule of ruling
amounts with respect to that plant for that tax
year multiplied by the product of:
(a) The portion of the transferor's
qualifying interest that is disposed of and

(b) A fraction, the numerator of which is
the number of days in the tax year that
precede the date of the disposition, and the
denominator of which is the number of days
in that tax year.
4. Tax year after the year of
disposition. A transferee of, or a transferor
who retains, a qualifying interest in a nuclear
power plant, must file a request for a revised
schedule of ruling amounts for the interest by
the deemed payment deadline (defined
above). If the transferee (or the transferor)
does not timely file such a request, the
transferee's (or the transferor's) ruling
amounts for the interest for that tax year will
be zero.

agencies to enforce federal nontax criminal
laws and to combat terrorism. If you do not
provide this information, or you provide false
or fraudulent information, you may be subject
to penalties.
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.

DRAFT AS OF
September 12, 2018
For more information, see Regulations
section 1.468A-6.

Paperwork Reduction and Privacy 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.

Section 4951 of the Internal Revenue
Code requires disqualified taxpayers
engaged in self-dealing with a trust to pay
over to the IRS an initial tax. This form is
used to report the initial amount of tax that
you owe. Sections 6001 and 6011 require
you to provide the requested information if
the tax applies to you. Section 6109 and its
regulations require you to provide your
identifying number. Routine uses of this
information include disclosing it to the
Department of Justice for civil and criminal
litigation and to other federal agencies, as
provided by law. We may disclose the
information to cities, states, the District of
Columbia, and U.S. Commonwealths or
possessions to administer their tax laws. We
may disclose the information to foreign
governments pursuant to tax treaties. We
may disclose the information to contractors
for tax administration purposes. We may also
disclose this information to federal and state

-5-

The time needed to complete and file this
form will vary depending on individual
circumstances. The estimated burden for
business taxpayers filing this form is
approved under OMB control number
1545-0123 and is included in the estimates
shown in the instructions for their business
income tax return. The estimated burden for
all other taxpayers who file this form is
shown below.
Recordkeeping . . . . . . . . . .

23 hr., 26 min.

Learning about the law or the
form . . . . . . . . . . . . . . . . .

3 hr., 7 min.

Preparing the form . . . . . . . .

5 hr., 30 min.

Copying, assembling, and
sending the form to the IRS . . .

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. You can
send us comments from IRS.gov/
FormComments. Or you can write to the
Internal Revenue Service, Tax Forms and
Publications Division, 1111 Constitution
Ave., NW, IR-6526, Washington, DC 20224.
Do not send the tax form to this address.
Instead, see Where To File, earlier.