Instructions for IRS Form 1099-PATR "Taxable Distributions Received From Cooperatives"

This document contains official instructions for IRS Form 1099-PATR, Taxable Distributions Received From Cooperatives - a tax form released and collected by the Internal Revenue Service (IRS), a subdivision of the U.S. Department of the Treasury. An up-to-date fillable IRS Form 1099-PATR is available for download through this link.

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2021
Department of the Treasury
Internal Revenue Service
Instructions for Form
1099-PATR
Taxable Distributions Received From Cooperatives
Section references are to the Internal Revenue Code unless
Report on Form 1099-PATR only items of income,
otherwise noted.
expenses, and credits that you properly pass through to
!
patrons for reporting on the patron's tax return.
Future Developments
CAUTION
Exceptions. Generally, you are not required to file Form
For the latest information about developments related to Form
1099-PATR for payments made to a corporation, a tax-exempt
1099-PATR and its instructions, such as legislation enacted after
organization including tax-exempt trusts (HSAs, Archer MSAs,
they were published, go to IRS.gov/Form1099PATR.
and Coverdell ESAs), the United States, a state, a possession,
What’s New
or the District of Columbia. See Regulations section 1.6044-3(c).
Statements to Recipients
Expiration of certain credits. The Indian Employment Credit,
Second Generation Biofuel Producer credits, and the Production
If you are required to file Form 1099-PATR, you must furnish a
Credit for Indian Coal Facilities reported in box 12 have expired.
statement to the recipient. For more information about the
See
Box 12. Other Credits and
Deductions, later.
requirement to furnish statements to recipients, see part M in the
2021 General Instructions for Certain Information Returns.
At the time these instructions went to print, these credits
had not been extended. To find out if legislation
!
Truncating recipient's TIN on payee statements. Pursuant
extended the credits and made them available for 2021,
to Regulations section 301.6109-4, all filers of this form may
CAUTION
go to IRS.gov/FormsUpdates.
truncate a payee’s TIN (social security number (SSN), individual
taxpayer identification number (ITIN), adoption taxpayer
Reminders
identification number (ATIN), or employer identification number
(EIN)) on payee statements. Truncation is not allowed on any
In addition to these specific instructions, you should also use the
documents the filer files with the IRS. A filer’s TIN may not be
2021 General Instructions for Certain Information Returns.
truncated on any form. See part J in the 2021 General
Those general instructions include information about the
Instructions for Certain Information Returns.
following topics.
Who must file.
2nd TIN Not.
When and where to file.
Electronic reporting.
You may enter an “X” in this box if you were notified by the IRS
Corrected and void returns.
twice within 3 calendar years that the payee provided an
Statements to recipients.
incorrect TIN. If you mark this box, the IRS will not send you any
Taxpayer identification numbers (TINs).
further notices about this account.
Backup withholding.
However, if you received both IRS notices in the same year,
Penalties.
or if you received them in different years but they both related to
Other general topics.
information returns filed for the same year, do not check the box
You can get the general instructions at
IRS.gov/
at this time. For purposes of the two-notices-in-3-years rule, you
1099GeneralInstructions.
are considered to have received one notice and you are not
required to send a second “B” notice to the taxpayer on receipt
Online fillable copies. To ease statement furnishing
of the second notice. See part N in the 2021 General Instructions
requirements, Copies B and C have been made fillable online in
for Certain Information Returns for more information.
a PDF format available at IRS.gov/Form1099PATR. You can
complete these copies online for furnishing statements to
.
recipients and for retaining in your own files.
For information on the TIN Matching System offered by
the IRS, see Items You Should Note in the 2021 General
Specific Instructions
TIP
Instructions for Certain Information Returns.
File Form 1099-PATR, Taxable Distributions Received From
Cooperatives, for each person to whom the cooperative has paid
Account Number
at least $10 in patronage dividends and other distributions
The account number is required if you have multiple accounts for
described in section 6044(b), or from whom you withheld any
a recipient for whom you are filing more than one Form
federal income tax under the backup withholding rules
1099-PATR. Additionally, the IRS encourages you to designate
regardless of the amount of the payment. A cooperative
an account number for all Forms 1099-PATR that you file. See
determined to be primarily engaged in the retail sale of goods or
part L in the 2021 General Instructions for Certain Information
services that are generally for personal, living, or family use of
Returns.
the members may ask for and receive exemption from filing
Form 1099-PATR. See Form 3491, Consumer Cooperative
Box 1. Patronage Dividends
Exemption Application, for information about how to apply for
Enter the patron’s share of total patronage dividends paid in
this exemption. Report dividends paid on a cooperative's capital
cash (including qualified or “consent” checks), qualified written
stock on Form 1099-DIV, Dividends and Distributions.
notices of allocation (face amount), and other property (except
Sep 17, 2020
Cat. No. 27984F
2021
Department of the Treasury
Internal Revenue Service
Instructions for Form
1099-PATR
Taxable Distributions Received From Cooperatives
Section references are to the Internal Revenue Code unless
Report on Form 1099-PATR only items of income,
otherwise noted.
expenses, and credits that you properly pass through to
!
patrons for reporting on the patron's tax return.
Future Developments
CAUTION
Exceptions. Generally, you are not required to file Form
For the latest information about developments related to Form
1099-PATR for payments made to a corporation, a tax-exempt
1099-PATR and its instructions, such as legislation enacted after
organization including tax-exempt trusts (HSAs, Archer MSAs,
they were published, go to IRS.gov/Form1099PATR.
and Coverdell ESAs), the United States, a state, a possession,
What’s New
or the District of Columbia. See Regulations section 1.6044-3(c).
Statements to Recipients
Expiration of certain credits. The Indian Employment Credit,
Second Generation Biofuel Producer credits, and the Production
If you are required to file Form 1099-PATR, you must furnish a
Credit for Indian Coal Facilities reported in box 12 have expired.
statement to the recipient. For more information about the
See
Box 12. Other Credits and
Deductions, later.
requirement to furnish statements to recipients, see part M in the
2021 General Instructions for Certain Information Returns.
At the time these instructions went to print, these credits
had not been extended. To find out if legislation
!
Truncating recipient's TIN on payee statements. Pursuant
extended the credits and made them available for 2021,
to Regulations section 301.6109-4, all filers of this form may
CAUTION
go to IRS.gov/FormsUpdates.
truncate a payee’s TIN (social security number (SSN), individual
taxpayer identification number (ITIN), adoption taxpayer
Reminders
identification number (ATIN), or employer identification number
(EIN)) on payee statements. Truncation is not allowed on any
In addition to these specific instructions, you should also use the
documents the filer files with the IRS. A filer’s TIN may not be
2021 General Instructions for Certain Information Returns.
truncated on any form. See part J in the 2021 General
Those general instructions include information about the
Instructions for Certain Information Returns.
following topics.
Who must file.
2nd TIN Not.
When and where to file.
Electronic reporting.
You may enter an “X” in this box if you were notified by the IRS
Corrected and void returns.
twice within 3 calendar years that the payee provided an
Statements to recipients.
incorrect TIN. If you mark this box, the IRS will not send you any
Taxpayer identification numbers (TINs).
further notices about this account.
Backup withholding.
However, if you received both IRS notices in the same year,
Penalties.
or if you received them in different years but they both related to
Other general topics.
information returns filed for the same year, do not check the box
You can get the general instructions at
IRS.gov/
at this time. For purposes of the two-notices-in-3-years rule, you
1099GeneralInstructions.
are considered to have received one notice and you are not
required to send a second “B” notice to the taxpayer on receipt
Online fillable copies. To ease statement furnishing
of the second notice. See part N in the 2021 General Instructions
requirements, Copies B and C have been made fillable online in
for Certain Information Returns for more information.
a PDF format available at IRS.gov/Form1099PATR. You can
complete these copies online for furnishing statements to
.
recipients and for retaining in your own files.
For information on the TIN Matching System offered by
the IRS, see Items You Should Note in the 2021 General
Specific Instructions
TIP
Instructions for Certain Information Returns.
File Form 1099-PATR, Taxable Distributions Received From
Cooperatives, for each person to whom the cooperative has paid
Account Number
at least $10 in patronage dividends and other distributions
The account number is required if you have multiple accounts for
described in section 6044(b), or from whom you withheld any
a recipient for whom you are filing more than one Form
federal income tax under the backup withholding rules
1099-PATR. Additionally, the IRS encourages you to designate
regardless of the amount of the payment. A cooperative
an account number for all Forms 1099-PATR that you file. See
determined to be primarily engaged in the retail sale of goods or
part L in the 2021 General Instructions for Certain Information
services that are generally for personal, living, or family use of
Returns.
the members may ask for and receive exemption from filing
Form 1099-PATR. See Form 3491, Consumer Cooperative
Box 1. Patronage Dividends
Exemption Application, for information about how to apply for
Enter the patron’s share of total patronage dividends paid in
this exemption. Report dividends paid on a cooperative's capital
cash (including qualified or “consent” checks), qualified written
stock on Form 1099-DIV, Dividends and Distributions.
notices of allocation (face amount), and other property (except
Sep 17, 2020
Cat. No. 27984F
nonqualified written notices of allocation) allowable as a
Note. The cooperative must reduce its section 1382 deduction
deduction under section 1382(b)(1).
by the amount of the section 199A(g) deduction passed through
to its patrons.
Box 2. Nonpatronage Distributions
Box 7. Qualified Payments
For farmers’ cooperatives exempt from tax under section 521
only, enter the patron’s share of the total amount paid in cash
For specified agricultural and horticultural cooperatives only,
(including qualified or “consent” checks), qualified written
enter the qualified payments paid to the patron. You are required
notices of allocation (face amount), and other property (except
to provide this information whether or not you pass any of the
nonqualified written notices of allocation) on a patronage basis
domestic production activities deduction (DPAD) through to the
with respect to the cooperative’s earnings that are derived from
patrons. See section 199A(b)(7).
business done for the United States or any agency thereof or
Box 8. Section 199A(a) Qualified Items
from nonpatronage sources allowable as a deduction under
section 1382(c)(2)(A).
Enter amounts reported to the patrons that are qualified items of
income, gain, deduction, or loss from qualified trades or
Redemptions of nonqualified written notices of allocation that
businesses that are not a specified service trade or business
were paid on a patronage basis with respect to the cooperative's
(SSTB) for purposes of section 199A. Examples of income that
earnings from nonpatronage sources allowable as a deduction
are not qualified items include tax-exempt income, capital gains,
under section 1382(c)(2)(B) are also required to be included in
and income that isn't effectively connected with the conduct of a
box 2. Prior to tax year 2020, these amounts were reported in
trade or business within the United States. See the Instructions
box 5.
for Form 8995-A for more information on qualified items. Report
items relating to SSTBs separately in box 9.
Box 3. Per-Unit Retain Allocations
Box 9. Section 199A(a) SSTB Items
Enter the patron’s share of the total per-unit retain allocations
paid in cash, qualified per-unit retain certificates (face amount),
Enter amounts reported to the patrons that are qualified items
and other property (except nonqualified per-unit retain
from otherwise qualified trades or businesses that are an SSTB
certificates) allowable as a deduction under section 1382(b)(3).
for purposes of section 199A. Examples of SSTBs include the
provision of services in the fields of health, law, accounting, etc.
Box 4. Federal Income Tax Withheld
See the Instructions for Form 8995-A for more information on
Enter backup withholding on patronage payments. Persons who
SSTBs and income that does not qualify as qualified items.
have not furnished their TIN to you in the manner required are
Box 10. Investment Credit
subject to withholding on payments required to be reported in
boxes 1, 2, 3, and 5 to the extent such payments are in cash or
Enter the patron’s share of total investment credit.
qualified check. See Regulations section 31.3406(b)(2)-5 for
more information on backup withholding by cooperatives.
Box 11. Work Opportunity Credit
Enter the patron’s share of total work opportunity credit.
For more information on backup withholding, including the
applicable rate, see part N in the 2021 General Instructions for
Box 12. Other Credits and Deductions
Certain Information Returns.
For the patron, state separately in box 12 the type and amount of
Box 5. Redeemed Nonqualified
each of the following credits and deductions.
Notices
The empowerment zone credit (Form 8844).
The low sulfur diesel fuel production credit (Form 8896).
Enter the amount of redeemed nonqualified written notices of
The credit for small employer health insurance premiums
allocation that were paid as a patronage dividend and the
(Form 8941).
amount of redeemed nonqualified per-unit retain certificates that
The credit for employer differential wage payments (Form
were paid as a per-unit retain allocation. See sections 1382(b)(2)
8932).
and (4).
The deduction for capital costs incurred by small refiner
cooperatives when complying with EPA sulfur regulations.
Box 6. Section 199A(g) Deduction
The biodiesel and renewable diesel fuels credit (Form 8864).
For specified agricultural and horticultural cooperatives only,
enter the patron's share of the amount of section 199A(g)
Box 13. Specified Cooperatives
deduction claimed by the cooperative under section 199A(g)
Check this box if you are reporting information as a specified
and passed through to the patron. This amount must have been
agricultural or horticultural cooperative, defined in section
designated in a written notice sent to the patron from the
199A(g)(4)(A) as a cooperative to which part 1 of subchapter T
cooperative within the payment period under section 1382(d).
of chapter 1 of subtitle A of the Code applies which is engaged
The deduction allocated to each patron cannot exceed 9% of the
(1) in the manufacturing, production, growth, or extraction in
qualified payments reported in box 7 and cannot be passed
whole or significant part of any agricultural or horticultural
through to patrons that are C corporations. Do not reduce the
product, or (2) in the marketing of agricultural or horticultural
amounts reported in box 1 or box 3 by the amount reported in
products.
box 6.
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Instructions for Form 1099-PATR (2021)
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