Form 8804-W
Forms

Form 8804-W: Installment Payments of Section 1446 Tax for Partnerships

Partnerships that have taxable income allocable to foreign partners are mandated to make estimated section 1446 tax payments of $500 or more, due by specific dates throughout the year. Penalties apply for those who do not comply with underpayments, but immediate catch-up payments can be made to reduce them.

What is Form 8804-W?

Form 8804-W (WORKSHEET) is used by partnerships that have taxable income allocable to foreign partners to determine the required estimated section 1446 tax payments. Payments of $500 or more are due four times per year, with any dates falling on a weekend or holiday pushed to the following business day. If the partnership fails to make the payments, it may be subject to underpayment penalties. The form 8813 must be completed in order to make an installment payment, and partnerships must also notify each foreign partner of the section 1446 tax that has been paid on their behalf. Any changes in the estimated tax should be refigured and a catch-up payment should be made to reduce the penalty for underpayment.

See also:  Form 8288-C: Statement of Withholding Under Section 1446(f)(4) on Dispositions by Foreign Persons of Partnership Interests

IRS Form 8804-W – Who Needs to Fill It Out?

IRS Form 8804-W (WORKSHEET) must be filled out by partnerships that have Effective Connected Taxable Income (ECTI) that is allocable to foreign partners, and where the aggregate tax liability on that ECTI is greater than $500. Payment installments are due to the IRS on the 15th of the 4th, 6th, 9th, and 12th months of the partnership’s tax year, and those installments must be accompanied by Form 8813. Partnerships must also notify foreign partners of any taxes paid on their behalf within 10 days of the due date of the installment or the payment date. If estimated tax is underpaid, there may be a penalty, and immediate catch-up payments should be made to reduce any such penalty.

See also:  Form 8851: Summary of Archer MSAs

Step-by-Step: Form 8804-W Instructions For Filling Out the Document

Partnerships that have income allocable to foreign partners with taxable income over $500 must make installment payments of estimated section 1446 tax by the 15th of the 4th, 6th, 9th, and 12th months of the tax year. Form 8813 must be filed and foreign partners must be notified of the section 1446 tax within 10 days of the installment payment due date. If any date falls on a Saturday, Sunday, or legal holiday, the installment is due on the next regular business day. If the amount originally estimated is incorrect, the partnership may need to refigure and may owe a penalty for underpayment of estimated tax. An immediate catch-up payment should be made to reduce any potential penalty.

Below, we present a table that will help you understand how to fill out Form 8804-W.

Form Name Form 8813
Purpose File installment payments of estimated section 1446 tax for partnerships with income allocable to foreign partners.
Filing Requirements File by specified due dates and notify foreign partners promptly. Make immediate catch-up payments if necessary.
Additional Information Refer to IRS rules for installment payments and penalties for underpayment. Ensure timely submission.
See also:  Form 8858: Information Return of U.S. Persons With Respect to Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs)

Do You Need to File Form 8804-W Each Year?

Partnerships that have ECTI allocable to foreign partners must use Form 8804-W (WORKSHEET) to determine the estimated section 1446 tax payments. Generally, if the aggregate tax on the ECTI that is allocable to all foreign partners will be $500 or more, installments must be made by the 15th day of the 4th, 6th, 9th, and 12th months of the partnership’s tax year. To make the installment payments, partnership must file Form 8813 and also notify each foreign partner. However, if the liability is more or less than what is originally estimated, then the installments may have to be refigured and a penalty may be due if earlier installments were underpaid. In these cases, the partnership should make an immediate catch-up payment.

Download the official IRS Form 8804-W PDF

On the official IRS website, you will find a link to download Form 8804-W. 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 8804-W

Sources:

https://www.irs.gov/forms-pubs/about-form-8804-w

https://www.irs.gov/instructions/i8804w

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