Form 8586: Low-Income Housing Credit
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Form 8586: Low-Income Housing Credit

Pass-through entities, such as partnerships, S corporations, estates, and trusts, can claim the low-income housing credit on Form 8586, although individual taxpayers are not required to complete the form. Owners of qualifying buildings must comply with certain conditions to avoid having to recapture the credit and file Form 3800 to report their claim. Fortunately, with TurboTax, filing taxes does not require manual calculations or forms.

What is Form 8586?

Form 8586 is an IRS form used by pass-through entities such as partnerships, S corporations, estates, and trusts to provide summary of credits for qualifying buildings that provide low-income housing. Form 8609 is then used to certify and allocate the amount of the credit. Annual filing of Form 8609-A is required for 15 years in order to avoid recapturing the credit using Form 8611. For individuals not filing through pass-through entities, the low-income housing credit can be reported directly on Form 3800. With TurboTax, users don’t need to understand tax forms for their calculations – TurboTax will handle all the calculations and forms.

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IRS Form 8586 – Who Needs to Fill It Out?

Form 8586 is used by pass-through entities such as partnerships, S corporations, estates, and trusts to report the credit they receive through low-income housing. To apply for the credit, the building owner must use Form 8609 to certify and allocate the amount of the credit. Depending on the structure, the credit can then be reported to Form 8586 or Form 3800. Additionally, Form 8609-A must be filed annually for 15 years to continue to meet certification requirements, and Form 8611 may be necessary for recapture of the credit. Depending on their situation, individual taxpayers may not need to complete Form 8586 at all, but can instead report the credit directly to Form 3800. To make the process easier, TurboTax is available to help manage the process and file taxes.

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Step-by-Step: Form 8586 Instructions For Filling Out the Document

Completing Form 8586 for a low-income housing credit requires a few key steps. Pass-through entities, such as partnerships and trusts, must file this form for certification. They must also complete the accompanying form 8609 to determine and allocate the amount of the credit. The building owner then has to file Form 8609-A annually for 15 years to keep their qualification in good standing. Finally, individual taxpayers or owners of pass-through entities must use Form 3800 and use their Employer Identification Numbers to report the credit allocation. TurboTax simplifies these complicated instructions and provides a straightforward platform to file taxes with confidence.

Information Required for Form 8586 Details
Credit Type Low-Income Housing Credit
Pass-Through Entity Information Details about the entity filing for certification
Form 8609-A Annual filing of Form 8609-A for 15 years

Do You Need to File Form 8586 Each Year?

Pass-through entities, such as partnerships, S corporations, estates, and trusts, are required to file Form 8586 to summarize credits from qualifying buildings providing low-income housing. Additionally, Form 8609 must be completed for certification and credit allocations, while Form 8609-A must be filed annually for 15 years to ensure continued certification. After 10 years, Form 3800 can be used to report the credit, with or without Form 8586. No matter which option you choose, TurboTax’s support will make filing as easy as possible. Their dedicated experts will uncover all possible deductions and make the necessary calculations, to guarantee complete coverage and reliable filing.

Download the official IRS Form 8586 PDF

On the official IRS website, you will find a link to download Form 8586. However, to make it easier for you, we are providing the link in our article, which comes directly from the official irs.gov website! Click to download: Form 8586

Sources:

https://www.irs.gov/forms-pubs/about-form-8586

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