General Instructions

Purpose of Form

Partnerships that have effectively connected taxable income (ECTI) allocable to foreign partners can use the Form 8804-W (WORKSHEET) to determine the proper estimated section 1446 tax payments.

Who Must Make Estimated Section 1446 Tax Payments

Partnerships generally must make installment payments of estimated section 1446 tax if the aggregate tax on the ECTI that is allocable to all foreign partners will be $500 or more.

When To Make Estimated Section 1446 Tax Payments

The installments are due by the 15th day of the 4th, 6th, 9th, and 12th months of the partnership's tax year. If any date falls on a Saturday, Sunday, or legal holiday, the installment is due on the next regular business day.

Underpayment of Estimated Section 1446 Tax

A partnership that does not make estimated section 1446 tax payments when due may be subject to an underpayment penalty for the period of underpayment. See Schedule A (Form 8804) for details.

How To Make Estimated Section 1446 Tax Payments

A partnership that is required to make an installment payment of section 1446 tax must file Form 8813, Partnership Withholding Tax Payment Voucher (Section 1446). Furthermore, the partnership is generally required to notify each foreign partner of the section 1446 tax paid on the partner's behalf within 10 days of the installment payment due date. See Regulations section 1.1446-3(d) and the Instructions for Forms 8804, 8805, and 8813 for more information.

Refiguring Estimated Section 1446 Tax

If, after the partnership figures and makes an installment payment of estimated section 1446 tax, it finds that its section 1446 tax liability for the year will be more or less than originally estimated, it may have to refigure its required installments. If earlier installments were underpaid, the partnership may owe a penalty for underpayment of estimated tax. An immediate catch-up payment should be made to reduce the amount of any penalty resulting from the underpayment of any earlier installments, whether caused by a change in estimate, failure to make a payment, or a mistake.

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