
Form 1099-PATR and Instructions 
Taxable Distributions Received From Cooperatives
2012

Cat. No. 33596B

Department of the Treasury
Internal Revenue Service

In 1 File
Print pages 1-5 and 1-2

Provided by the IRS AMC
(Alternative Media Center)
2011

Contents

Section:  Page
Form 1099-PATR:  1
Copy A--For IRS:  1
Copy B--For Recipient:  2
Instructions for Recipient:  3
Copy C--For Payer:  4
Instructions for Payer:  5
2012 Instructions for Form 1099-PATR:  1
What's New:  1
Reminders:  1
Specific Instructions:  1

This electronic edition contains the entire text of the print editions.

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Form 1099-PATR
Taxable Distributions Received From Cooperatives
2012

Copy A
For Internal Revenue Service Center

File with Form 1096.

VOID --; CORRECTED --
PAYER'S name, street address, city, state, ZIP code, and telephone no.: ----
PAYER'S federal identification number: ----
RECIPIENT'S identification number: ----
RECIPIENT'S name: ----
Street address (including apt. no.): ----
City, state, and ZIP code: ----
Account number (see instructions): ----
2nd TIN not.: --

1. Patronage dividends: $----
2. Nonpatronage distributions: $----
3. Per-unit retain allocations: $----
4. Federal income tax withheld: $----
5. Redemption of nonqualified notices and retain allocations: $----
6. Domestic production activities deduction: $----
7. Investment credit: $----
8. Work opportunity credit: $----
9. Patron's AMT adjustment: $----
10. Other credits and deductions: $----

For Privacy Act and Paperwork Reduction Act Notice, see the 2012 General Instructions for Certain Information Returns.

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Form 1099-PATR
Taxable Distributions Received From Cooperatives
2012

Copy B
For Recipient

CORRECTED (if checked) --
PAYER'S name, street address, city, state, ZIP code, and telephone no.: ----
PAYER'S federal identification number: ----
RECIPIENT'S identification number: ----
RECIPIENT'S name: ----
Street address (including apt. no.): ----
City, state, and ZIP code: ----
Account number (see instructions): ----

1. Patronage dividends: $----
2. Nonpatronage distributions: $----
3. Per-unit retain allocations: $----
4. Federal income tax withheld: $----
5. Redemption of nonqualified notices and retain allocations: $----
6. Domestic production activities deduction: $----
7. Investment credit: $----
8. Work opportunity credit: $----
9. Patron's AMT adjustment: $----
10. Other credits and deductions: $----

This is important tax information and is being furnished to the Internal Revenue Service.  If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this income is taxable and the IRS determines that it has not been reported.

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Instructions for Recipient

Distributions you received from a cooperative may be includible in your income. Generally, if you are an individual, report any amounts shown in boxes 1, 2, 3, and 5 as income, unless nontaxable, on Schedule F (Form 1040), Schedule C (Form 1040), or Form 4835. See the instructions for Schedule F (Form 1040) and Pub. 225 for more information.

Recipient's identification number. For your protection, this form may show only the last four digits of your social security number (SSN), individual taxpayer identification number (ITIN), or adoption taxpayer identification number (ATIN). However, the issuer has reported your complete identification number to the IRS, and, where applicable, to state and/or local governments.

Account number. May show an account or other unique number the payer assigned to distinguish your account.

Box 1. Shows patronage dividends paid to you during the year in cash, qualified written notices of allocation (at stated dollar value), or other property (not including nonqualified allocations). Any dividends paid on (1) property bought for personal use or (2) capital assets or depreciable property used in your business are not taxable. However, if (2) applies, reduce the basis of the assets by this amount.

Box 2. Shows nonpatronage distributions paid to you during the year in cash, qualified written notices of allocation, or other property (not including nonqualified written notices of allocation).

Box 3. Shows per-unit retain allocations paid to you during the year in cash, qualified per-unit retain certificates, or other property.

Box 4. Shows backup withholding. Generally, a payer must backup withhold if you did not furnish your taxpayer identification number to the payer. See Form W-9 for information on backup withholding. Include this amount on your income tax return as tax withheld.

Box 5. Shows amounts you received when you redeemed nonqualified written notices of allocation and nonqualified per-unit retain allocations. Because these were not taxable when issued to you, you must report the redemption as ordinary income to the extent of the stated dollar value.

Box 6. Shows the deduction amount you may take based on your portion of patronage dividends or per-unit retain allocations (boxes 1 and 3) attributable to qualified production activities income. To claim the deduction amount, this amount must have been designated in a written notice sent to you from the cooperative within the payment period under section 1382(d). Enter on the appropriate line of Form 8903.

Boxes 7, 8, and 10. These boxes may show unused credits and deductions passed through to you by the cooperative. Generally, if your only source for a credit is from the cooperative, you are not required to complete the source credit form or attach it to Form 3800. Therefore, the following credits may be reported directly on Form 3800: the work opportunity credit (Form 5884); the small ethanol and cellulosic biofuel producer credits (Form 6478); the renewable electricity production credit (Form 8835, Part I); the Indian employment credit (Form 8845); and the energy efficient appliance credit (Form 8909). However, for the following credits, complete the forms shown and follow the instructions on the form for how to report the credit: the investment credit (Form 3468); the renewable electricity, refined coal, and Indian coal production credit (Form 8835, Part II); the biodiesel and renewable diesel fuels credit (Form 8864); and the agricultural chemicals security credit (Form 8931). For information on how to report other credits and deductions (including depreciation) that may be passed through to you, see the instructions for Schedules C and F (Form 1040) and Pub. 946.

Box 9. Shows the alternative minimum tax (AMT) adjustment passed through to you by the cooperative. Report this amount on Form 6251 on the appropriate line in Part I.

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Form 1099-PATR
Taxable Distributions Received From Cooperatives
2012

Copy C
For Payer

VOID --; CORRECTED --
PAYER'S name, street address, city, state, ZIP code, and telephone no.: ----
PAYER'S federal identification number: ----
RECIPIENT'S identification number: ----
RECIPIENT'S name: ----
Street address (including apt. no.): ----
City, state, and ZIP code: ----
Account number (see instructions): ----
2nd TIN not.: --

1. Patronage dividends: $----
2. Nonpatronage distributions: $----
3. Per-unit retain allocations: $----
4. Federal income tax withheld: $----
5. Redemption of nonqualified notices and retain allocations: $----
6. Domestic production activities deduction: $----
7. Investment credit: $----
8. Work opportunity credit: $----
9. Patron's AMT adjustment: $----
10. Other credits and deductions: $----

For Privacy Act and Paperwork Reduction Act Notice, see the 2012 General Instructions for Certain Information Returns.

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Instructions for Payer

General and specific form instructions are provided as separate products. The products you should use to complete Form 1099-PATR are the 2012 General Instructions for Certain Information Returns and the 2012 Instructions for Form 1099-PATR. A chart in the general instructions gives a quick guide to which form must be filed to report a particular payment. To order these instructions and additional forms, visit IRS.gov or call 1-800-TAX-FORM (1-800-829-3676).

Caution: Because paper forms are scanned during processing, you cannot file Forms 1096, 1097, 1098, 1099, 3921, 3922, or 5498 that you print from the IRS website.

Due Dates. Furnish Copy B of this form to the recipient by January 31, 2013.

File Copy A of this form with the IRS by February 28, 2013. If you file electronically, the due date is April 1, 2013. To file electronically, you must have software that generates a file according to the specifications in Pub. 1220, Specifications for Filing Forms 1097, 1098, 1099, 3921, 3922, 5498, 8935, and W-2G Electronically. IRS does not provide a fill-in form option.

Foreign recipient. If the recipient is a nonresident alien, you may have to withhold federal income tax and file Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding. See the Instructions for Form 1042-S and Pub. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities.

Need help? If you have questions about reporting on Form 1099-PATR, call the information reporting customer service site toll free at 1-866-455-7438 or 304-263-8700 (not toll free). For TTY/TDD equipment, call 304-579-4827 (not toll free). The hours of operation are Monday through Friday from 8:30 a.m. to 4:30 p.m., Eastern time.

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2012 Instructions for Form 1099-PATR

Section references are to the Internal Revenue Code unless otherwise noted.

What's New

Truncating recipient identification number on paper payee statements. Notice 2011-38 allows filers of this form to truncate a recipient's identification number (social security number (SSN), individual taxpayer identification number (ITIN), or adoption taxpayer identification number (ATIN)) on paper payee statements for tax years 2011 and 2012. See part M in the 2012 General Instructions for Certain Information Returns.

Retention of expiring credits. The following credits expired on December 31, 2011. They are being retained in these instructions for the benefit of fiscal year reporting cooperatives.
-- The biodiesel and renewable diesel fuels credit, under section 40A(g).
-- The Indian employment credit, under section 45A.
-- The energy efficient appliance credit, under section 45M(b).

Reminders

General instructions. In addition to these specific instructions, you should also use the 2012 General Instructions for Certain Information Returns. Those general instructions include information about the following topics.
-- Backup withholding.
-- Electronic reporting requirements.
-- Penalties.
-- Who must file (nominee/middleman).
-- When and where to file.
-- Taxpayer identification numbers.
-- Statements to recipients.
-- Corrected and void returns.
-- Other general topics.

You can get the general instructions at IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676).

How to get the latest information. If there are changes to the 2012 tax laws that affect this form, you can find them at www.irs.gov/form1099patr.

Specific Instructions

File Form 1099-PATR, Taxable Distributions Received From Cooperatives, for each person to whom the cooperative has paid at least $10 in patronage dividends and other distributions described in section 6044(b) or from whom you withheld any federal income tax under the backup withholding rules regardless of the amount of the payment. A cooperative determined to be primarily engaged in the retail sale of goods or services that are generally for personal, living, or family use of the members may ask for and receive exemption from filing Form 1099-PATR. See Form 3491, Consumer Cooperative Exemption Application, for information about how to apply for this exemption. Report dividends paid on a cooperative's capital stock on Form 1099-DIV, Dividends and Distributions.

CAUTION: Report on Form 1099-PATR only items of income, expenses, and credits that you properly pass through to patrons for reporting on the patron's tax return.

Exceptions. Generally, you are not required to file Form 1099-PATR for payments made to a corporation, a tax-exempt organization including tax-exempt trusts (HSAs, Archer MSAs, and Coverdell ESAs), the United States, a state, a possession, or the District of Columbia. See Regulations section 1.6044-3(c).

Statements to Recipients

If you are required to file Form 1099-PATR, you must provide a statement to the recipient. For more information about the requirement to furnish an official form or acceptable substitute statement to recipients in person, by statement mailing or electronically, see part M in the 2012 General Instructions for Certain Information Returns.

2nd TIN Not.

You may enter an "X" in this box if you were notified by the IRS twice within 3 calendar years that the payee provided an incorrect taxpayer identification number (TIN). If you mark this box, the IRS will not send you any further notices about this account. However, if you received both IRS notices in the same year, or if you received them in different years but they both related to information returns filed for the same year, do not check the box at this time. For purposes of the two-notices-in-3-years rule, you are considered to have received one notice. You are not required to send a second "B" notice to the taxpayer on receipt of the second notice. See part N in the 2012 General Instructions for Certain Information Returns for more information.

TIP: For information on the TIN Matching system offered by the IRS, see Items You Should Note in the 2012 General Instructions for Certain Information Returns.

Account Number

The account number is required if you have multiple accounts for a recipient for whom you are filing more than one Form 1099-PATR. Additionally, the IRS encourages you to designate an account number for all Forms 1099-PATR that you file. See part L in the 2012 General Instructions for Certain Information Returns.

Box 1. Patronage Dividends

Enter the total patronage dividends paid in cash (qualified or "consent" checks), qualified written notices of allocation (face amount), and other property (except nonqualified written notices of allocation).

Box 2. Nonpatronage Distributions

This box applies only to farmers' cooperatives exempt from tax under section 521. Enter the total nonpatronage distributions paid in cash (qualified or "consent" checks), qualified written notices of allocation (face amount), and other property. Do not include nonqualified written notices of allocation.

Box 3. Per-Unit Retain Allocations

Enter the total per-unit retain allocations paid in cash, qualified per-unit retain certificates (face amount), and other property.

Box 4. Federal Income Tax Withheld

Enter backup withholding. For example, persons who have not furnished their TIN to you in the manner required are subject to withholding at a 28% rate on payments required to be reported in boxes 1, 2, 3, and 5 to the extent such payments are in cash or qualified check. See Regulations section 31.3406(b)(2)-5 for more information on backup withholding by cooperatives.

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Box 5. Redemption of Nonqualified Notices and Retain Allocations

For farmers' cooperatives qualifying under section 521 only, enter all redemptions of nonqualified written notices of allocation issued as patronage dividends or nonqualified written notices of allocation issued as nonpatronage allocations. Also enter nonqualified per-unit retain certificates issued with respect to marketing.

Pass-Through Credits and Deductions

Report in the appropriate boxes the patron's share of unused credits and deductions that the cooperative is passing through to the patron.

Box 6. Domestic Production Activities Deduction

CAUTION: A cooperative must reduce its section 1382 deduction by an amount equal to the portion of any patronage dividend or per-unit retain allocation, including any advances on these paid in cash during the year, that is attributable to the cooperative's section 199 deduction passed through to its patrons during the year. See Regulations section 1.199-6 for more details.

Deduction for domestic production activities income. Section 199(d)(3) and Regulations section 1.199-6 provide special rules for cooperatives to pass through, if elected, to their patrons receiving certain patronage dividends or certain per-unit retain allocations from the cooperative a deduction equal to their portion of the cooperative's qualified production activities income (QPAI) that would be deductible by the cooperative and have been designated by the cooperative in a written notice mailed to its patrons during the payment period specified under section 1382(d). The deduction for QPAI applies to any cooperative that is engaged in the manufacturing, producing, growing, or extracting in whole or significant part of any agricultural or horticultural product, or the marketing of agricultural or horticultural products.

If any amount of a patronage dividend or qualified per-unit retain allocation is passed through to a patron, and such amount is allocable to QPAI that is deductible under section 199(a), then the amount is reported in box 6. However, if no written notice (see later) was sent within the payment period or if the cooperative does not pass through the deduction to the patron, leave box 6 blank.

To determine the portion of the cooperative's QPAI that would be deductible, the cooperative's taxable income is computed without taking into account any deduction allowable under section 1382(b) or (c) relating to patronage dividends, per-unit retain allocations, and nonpatronage distributions. In the case of a cooperative engaged in the marketing of agricultural or horticultural products (or both), the cooperative is treated as having manufactured, produced, grown, or extracted in whole or in significant part any qualifying production property marketed by the cooperative that its patrons have manufactured, produced, grown, or extracted. Agricultural or horticultural products also include fertilizer, diesel fuel, and other supplies used in agricultural or horticultural production that are manufactured, produced, grown, or extracted by the cooperative.

CAUTION: Do not reduce the amounts reported in boxes 1 or 3 by the amount you report in box 6.

Written notice. In order for the patron to qualify for the deduction, the cooperative must designate the patron's portion of the section 199 deduction in a written notice mailed to the patron no later than the 15th day of the ninth month following the close of the tax year. The cooperative may use the same written notice, if any, that it uses to notify patrons of their respective allocations of patronage dividends, or may use a separate timely written notice to comply with the written notice requirement for this deduction.

Box 7. Investment Credit

Enter the total investment credit for the patron.

Box 8. Work Opportunity Credit

Enter the total work opportunity credit for the patron.

Box 9. Patron's AMT Adjustment

Enter the total alternative minimum tax (AMT) patronage dividend adjustment for the patron.

Box 10. Other Credits and Deductions

For the patron, state separately in box 10 the type and amount of each of the following credits and deductions.
-- The small ethanol producer credit (Form 6478).
-- The cellulosic biofuel producer credit (Form 6478).
-- The renewable electricity, refined coal, and Indian coal production credit (Form 8835).
-- The empowerment zone and renewal community employment credit (Form 8844).
-- The Indian employment credit (Form 8845).
-- The small agri-biodiesel producer credit (Form 8864).
-- The energy efficient appliance credit (Form 8909).
-- The agricultural chemicals security credit (Form 8931).
-- The deduction for capital costs incurred by small refiner cooperatives when complying with EPA sulfur regulations.
-- The deduction for expensing qualified refinery property under section 179C.

End of Form 1099-PATR and Instructions
