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26 U.S.C. § 1381 — Organizations to which part applies
Federal law — U.S. Code and appendices · legal_authorities
**(a) In general** This part shall apply to—
(1) any organization exempt from tax under section 521 (relating to exemption of farmers’ cooperatives from tax), and
(2) any corporation operating on a cooperative basis other than an organization—
(A) which is exempt from tax under this chapter,
(B) which is subject to the provisions of—
(i) part II of subchapter H (relating to mutual savings banks, etc.), or
(ii) subchapter L (relating to insurance companies), or
(C) which is engaged in furnishing electric energy, or providing telephone service, to persons in rural areas.
**(b) Tax on certain farmers’ cooperatives** An organization described in subsection (a)(1) shall be subject to the tax imposed by section 11.
**(c) Cross reference** For treatment of income from load loss transactions of organizations described in subsection (a)(2)(C), see section 501(c)(12)(H).
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Source location: Title 26, Chapter 1, § 1381; chapter-001-normal-taxes-and-surtaxes.md
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**(a) In general** This part shall apply to—
(1) any organization exempt from tax under section 521 (relating to exemption of farmers’ cooperatives from tax), and
(2) any corporation operating on a cooperative basis other than an organization—
(A) which is exempt from tax under this chapter,
(B) which is subject to the provisions of—
(i) part II of subchapter H (relating to mutual savings banks, etc.), or
(ii) subchapter L (relating to insurance companies), or
(C) which is engaged in furnishing electric energy, or providing telephone service, to persons in rural areas.
**(b) Tax on certain farmers’ cooperatives** An organization described in subsection (a)(1) shall be subject to the tax imposed by section 11.
**(c) Cross reference** For treatment of income from load loss transactions of organizations described in subsection (a)(2)(C), see section 501(c)(12)(H).
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Federal law — U.S. Code and appendices · legal_authorities
### Statutory Notes
Section, act Aug. 16, 1954, ch. 736, 68A Stat. 177, related to tax on farmers’ cooperatives.
#### Effective Date of Repeal
Repeal applicable, except as otherwise provided, to taxable years of organizations described in [section 1381(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1381/a&num=0&edition=prelim) beginning after Dec. 31, 1962, see section 17(c) of Pub. L. 87–834, set out as an Effective Date note under [section 1381 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1381&num=0&edition=prelim).
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Corporations in general** A tax is hereby imposed for each taxable year on the taxable income of every corporation.
**(b) Amount of tax** The amount of the tax imposed by subsection (a) shall be 21 percent of taxable income.
**(c) Exceptions** Subsection (a) shall not apply to a corporation subject to a tax imposed by—
(1) section 594 (relating to mutual savings banks conducting life insurance business),
(2) subchapter L (sec. 801 and following, relating to insurance companies), or
(3) subchapter M (sec. 851 and following, relating to regulated investment companies and real estate investment trusts).
**(d) Foreign corporations** In the case of a foreign corporation, the taxes imposed by subsection (a) and section 55 shall apply only as provided by section 882.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Exemption from taxation** An organization described in subsection (c) or (d) or section 401(a) shall be exempt from taxation under this subtitle unless such exemption is denied under section 502 or 503.
**(b) Tax on unrelated business income and certain other activities** An organization exempt from taxation under subsection (a) shall be subject to tax to the extent provided in parts II, III, and VI of this subchapter, but (notwithstanding parts II, III, and VI of this subchapter) shall be considered an organization exempt from income taxes for the purpose of any law which refers to organizations exempt from income taxes.
**(c) List of exempt organizations** The following organizations are referred to in subsection (a):
(1) Any corporation organized under Act of Congress which is an instrumentality of the United States but only if such corporation—
(A) is exempt from Federal income taxes—
(i) under such Act as amended and supplemented before July 18, 1984, or
(ii) under this title without regard to any provision of law which is not contained in this title and which is not contained in a revenue Act, or
(B) is described in subsection (l).
(2) Corporations organized for the exclusive purpose of holding title to property, collecting income therefrom, and turning over the entire amount thereof, less expenses, to an organization which itself is exempt under this section. Rules similar to the rules of subparagraph (G) of paragraph (25) shall apply for purposes of this paragraph.
(3) Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Gross income** Except as provided in subsection (b), the gross income of any organization to which this part applies shall be determined without any adjustment (as a reduction in gross receipts, an increase in cost of goods sold, or otherwise) by reason of any allocation or distribution to a patron out of the net earnings of such organization or by reason of any amount paid to a patron as a per-unit retain allocation (as defined in section 1388(f)).
**(b) Patronage dividends and per-unit retain allocations** In determining the taxable income of an organization to which this part applies, there shall not be taken into account amounts paid during the payment period for the taxable year—
(1) as patronage dividends (as defined in section 1388(a)), to the extent paid in money, qualified written notices of allocation (as defined in section 1388(c)), or other property (except nonqualified written notices of allocation (as defined in section 1388(d))) with respect to patronage occurring during such taxable year;
(2) in money or other property (except written notices of allocation) in redemption of a nonqualified written notice of allocation which was paid as a patronage dividend during the payment period for the taxable year during which the patronage occurred;
(3) as per-unit retain allocations (as defined in section 1388(f)), to the extent paid in money, qualified per-unit retain certificates (as defined in section 1388(h)), or other property (except nonqualified per-unit retain certificates, as defined in section 1388(i)) with respect to marketing occurring during such taxable year; or
(4) in money or other property (except per-unit retain certificates) in redemption of a nonqualified per-unit retain certificate which was paid as a per-unit retain allocation durin
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1382
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** If, under section 1382(b)(2) or (4), or (c)(2)(B), a deduction is allowable to an organization for the taxable year for amounts paid in redemption of nonqualified written notices of allocation or nonqualified per-unit retain certificates, then the tax imposed by this chapter on such organization for the taxable year shall be the lesser of the following:
(1) the tax for the taxable year computed with such deduction; or
(2) an amount equal to—
(A) the tax for the taxable year computed without such deduction, minus
(B) the decrease in tax under this chapter for any prior taxable year (or years) which would result solely from treating such nonqualified written notices of allocation or nonqualified per-unit retain certificates as qualified written notices of allocation or qualified per-unit retain certificates (as the case may be).
**(b) Special rules**
(1) If the decrease in tax ascertained under subsection (a)(2)(B) exceeds the tax for the taxable year (computed without the deduction described in subsection (a)) such excess shall be considered to be a payment of tax on the last day prescribed by law for the payment of tax for the taxable year, and shall be refunded or credited in the same manner as if it were an overpayment for such taxable year.
(2) For purposes of determining the decrease in tax under subsection (a)(2)(B), the stated dollar amount of any nonqualified written notice of allocation or nonqualified per-unit retain certificate which is to be treated under such subsection as a qualified written notice of allocation or qualified per-unit retain certificate (as the case may be) shall be the amount paid in redemption of such written notice of allocation or per-unit retain certificate which is allowable as a deduction under section
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** Except as otherwise provided in subsection (b), each person shall include in gross income—
(1) the amount of any patronage dividend which is paid in money, a qualified written notice of allocation, or other property (except a nonqualified written notice of allocation), and which is received by him during the taxable year from an organization described in section 1381(a),
(2) any amount, described in section 1382 (c)(2)(A) (relating to certain nonpatronage distributions by tax-exempt farmers’ cooperatives), which is paid in money, a qualified written notice of allocation, or other property (except a nonqualified written notice of allocation), and which is received by him during the taxable year from an organization described in section 1381(a)(1), and
(3) the amount of any per-unit retain allocation which is paid in qualified per-unit retain certificates and which is received by him during the taxable year from an organization described in section 1381(a).
**(b) Exclusion from gross income** Under regulations prescribed by the Secretary, the amount of any patronage dividend, and any amount received on the redemption, sale, or other disposition of a nonqualified written notice of allocation which was paid as a patronage dividend, shall not be included in gross income to the extent that such amount—
(1) is properly taken into account as an adjustment to basis of property, or
(2) is attributable to personal, living, or family items.
**(c) Treatment of certain nonqualified written notices of allocation and certain nonqualified per-unit retain certificates**
(1) **Application of subsection** — This subsection shall apply to—
(A) any nonqualified written notice of allocation which—
(i) was paid as a patronage dividend, or
(ii) was paid
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1385
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Patronage dividend** For purposes of this subchapter, the term “patronage dividend” means an amount paid to a patron by an organization to which part I of this subchapter applies—
(1) on the basis of quantity or value of business done with or for such patron,
(2) under an obligation of such organization to pay such amount, which obligation existed before the organization received the amount so paid, and
(3) which is determined by reference to the net earnings of the organization from business done with or for its patrons.
Such term does not include any amount paid to a patron to the extent that (A) such amount is out of earnings other than from business done with or for patrons, or (B) such amount is out of earnings from business done with or for other patrons to whom no amounts are paid, or to whom smaller amounts are paid, with respect to substantially identical transactions. For purposes of paragraph (3), net earnings shall not be reduced by amounts paid during the year as dividends on capital stock or other proprietary capital interests of the organization to the extent that the articles of incorporation or bylaws of such organization or other contract with patrons provide that such dividends are in addition to amounts otherwise payable to patrons which are derived from business done with or for patrons during the taxable year.
**(b) Written notice of allocation** For purposes of this subchapter, the term “written notice of allocation” means any capital stock, revolving fund certificate, retain certificate, certificate of indebtedness, letter of advice, or other written notice, which discloses to the recipient the stated dollar amount allocated to him by the organization and the portion thereof, if any, which constitutes a patronage dividend.
**(c) Qualif
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1388
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Exemption from tax** A farmers’ cooperative organization described in subsection (b)(1) shall be exempt from taxation under this subtitle except as otherwise provided in part I of subchapter T (sec. 1381 and following). Notwithstanding part I of subchapter T (sec. 1381 and following), such an organization shall be considered an organization exempt from income taxes for purposes of any law which refers to organizations exempt from income taxes.
**(b) Applicable rules**
(1) **Exempt farmers’ cooperatives** — The farmers’ cooperatives exempt from taxation to the extent provided in subsection (a) are farmers’, fruit growers’, or like associations organized and operated on a cooperative basis (A) for the purpose of marketing the products of members or other producers, and turning back to them the proceeds of sales, less the necessary marketing expenses, on the basis of either the quantity or the value of the products furnished by them, or (B) for the purpose of purchasing supplies and equipment for the use of members or other persons, and turning over such supplies and equipment to them at actual cost, plus necessary expenses.
(2) **Organizations having capital stock** — Exemption shall not be denied any such association because it has capital stock, if the dividend rate of such stock is fixed at not to exceed the legal rate of interest in the State of incorporation or 8 percent per annum, whichever is greater, on the value of the consideration for which the stock was issued, and if substantially all such stock (other than nonvoting preferred stock, the owners of which are not entitled or permitted to participate, directly or indirectly, in the profits of the association, upon dissolution or otherwise, beyond the fixed dividends) is owned by producers who market the
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 521
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Federal law — U.S. Code and appendices · legal_authorities
**(a) General rule** In the case of returns under section 6012, 6013, or 6017 (relating to income tax under subtitle A), returns made on the basis of the calendar year shall be filed on or before the 15th day of April following the close of the calendar year and returns made on the basis of a fiscal year shall be filed on or before the 15th day of the fourth month following the close of the fiscal year, except as otherwise provided in the following subsections of this section.
**(b) Returns of partnerships and S corporations** Returns of partnerships under section 6031 and returns of S corporations under sections 6012 and 6037 made on the basis of the calendar year shall be filed on or before the 15th day of March following the close of the calendar year, and such returns made on the basis of a fiscal year shall be filed on or before the 15th day of the third month following the close of the fiscal year. Returns required for a taxable year by section 6011(c)(2) (relating to returns of a DISC) shall be filed on or before the fifteenth day of the ninth month following the close of the taxable year.
**(c) Returns by certain nonresident alien individuals and foreign corporations** Returns made by nonresident alien individuals (other than those whose wages are subject to withholding under chapter 24) and foreign corporations (other than those having an office or place of business in the United States or a former FSC (as defined in section 922 as in effect before its repeal by the FSC Repeal and Extraterritorial Income Exclusion Act of 2000)) under section 6012 on the basis of a calendar year shall be filed on or before the 15th day of June following the close of the calendar year and such returns made on the basis of a fiscal year shall be filed on or before the 15th day o
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Federal law — U.S. Code and appendices · legal_authorities
Page 2469
TITLE 26—INTERNAL REVENUE CODE
§ 1381
sion Act of 1982) shall continue to apply with re-
spect to distributions of undistributed taxable
income for any taxable year beginning before
January 1, 1983.
(d) Carryforwards
If a corporation was an electing small business
corporation for the last preenactment year and
is an S corporation for the 1st postenactment
year, any carryforward to the 1st postenactment
year which arose in a taxable year for which the
corporation was an electing small business cor-
poration shall be treated as arising in the 1st
postenactment year.
(e) Preenactment and postenactment years de-
fined
For purposes of this subsection—
(1) Last preenactment year
The term ‘‘last preenactment year’’ means
the last taxable year of a corporation which
begins before January 1, 1983.
(2) 1st postenactment year
The term ‘‘1st postenactment year’’ means
the 1st taxable year of a corporation which be-
gins after December 31, 1982.
(Added Pub. L. 97–354, § 2, Oct. 19, 1982, 96 Stat.
1686; amended Pub. L. 98–369, div. A, title VII,
§ 721(n), July 18, 1984, 98 Stat. 969.)
Editorial Notes
REFERENCES IN TEXT
The enactment of the Subchapter S Revision Act of
1982, referred to in subsecs. (a) to (c), is the enactment
of Pub. L. 97–354, which was approved Oct. 19, 1982.
PRIOR PROVISIONS
A prior section 1379, added Pub. L. 91–172, title V,
§ 531(a), Dec. 30, 1969, 83 Stat. 654; amended Pub. L.
93–406, title II, § 2001(b), Sept. 2, 1974, 88 Stat. 952; Pub.
L. 97–34, title III, § 312(c)(6), Aug. 13, 1981, 95 Stat. 284;
Pub. L. 97–248, title II, § 238(c), Sept. 3, 1982, 96 Stat. 513,
related to certain qualified pension, etc., plans, prior to
the general revision of this subchapter by section 2 of
Pub. L. 97–354.
AMENDMENTS
1984—Subse
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