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26 U.S.C. § 1383 — Computation of tax where cooperative redeems nonqualified written notices of allocation or nonqualified per-unit retain certificates
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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Source file: Laws/federal/codes/united-states-code/title-26/section-1383-computation-of-tax-where-cooperative-redeems-nonqualified-written-notice--e495bd0432.md
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Source location: Title 26, Chapter 1, § 1383; chapter-001-normal-taxes-and-surtaxes.md
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**(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 1382(b)(2) or (4), or (c)(2)(B) for the taxable year.
(3) If the tax imposed by this chapter for the taxable year is the amount determined under subsection (a)(2), then the deduction described in subsection (a) shall not be taken into account for any purpose of this subtitle other than for purposes of this section.
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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).
Source: Supplied U.S. Code snapshot — release unconfirmed · 26 U.S.C. § 1381
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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
Page 2472
TITLE 26—INTERNAL REVENUE CODE
§ 1383
§ 1383. Computation of tax where cooperative re-
deems nonqualified written notices of alloca-
tion or nonqualified per-unit retain certifi-
cates
(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 organi-
zation 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 non-
qualified 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 tax-
able year (computed without the deduction de-
scribed 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 cred-
ited in the same manner as if it were an over-
payment 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 al-
location or nonqualified per-unit retain certifi-
cate which is to be treated under such sub-
section as a qualified written notice of alloca
Source: Supplied 2024 U.S. Code historical extraction · 26 U.S.C. § 1383
Stored review status: historical_2024_not_currentness_verified. Same stored citation; legal effect and authority still require review.