Form 8883, Asset Allocation Statement Under Section 338, is used to report information about transactions involving the deemed sale of corporate assets under section 338. This includes two types of section 338 elections: one made by the purchasing corporation and the other jointly by the old target shareholders and the purchasing corporation.
What is Form 8883?
Form 8883, Asset Allocation Statement Under Section 338, is used to report information about deemed sale of corporate assets made under section 338 of the Internal Revenue Code. It must be used to make section 338(g) and 338(h)(10) elections, and can be attached to the income tax return for the year in which a sale occurs. Form 8883 must be filed when an acquisition date has occurred with the purchase of stock from the old target and the new target, and even if all information on the form is not available. Penalties may be issued if the form is not filled out correctly and on time.
IRS Form 8883 – Who Needs to Fill It Out?
IRS Form 8883 needs to be completed for any transactions involving a deemed sale of corporate assets under Section 338 (as per Form 8023). It must be completed and filed in accordance with the type of Section 338 election being made, and the old and new target’s tax return. Penalties may be applicable if the form is not filed correctly and on time. For multiple targets under Section 338, one Form 8023 can be used, but separate Forms 8883 must be filed for each target.
Step-by-Step: Form 8883 Instructions For Filling Out the Document
Use Form 8883 to report information about transactions involving the deemed sale of corporate assets under section 338 of the U.S. Tax Code. When filing Form 8883, make sure to attach it to the appropriate income tax return: the return of the old target, the return of the new target, or the return of the consolidated group that includes the acquisition date. Form 8883 may also be used to make both section 338(g) and 338(h)(10) elections, and, when necessary, should be supplemented with increases or decreases in asset allocations. It is also important to note that separate Forms 8883 must be filed for each target corporation when multiple targets are involved. Penalties may be incurred if a correct Form 8883 is not filed by the due date without reasonable cause.
Below, we present a table that will help you understand how to fill out Form 8883.
| Form Name | Form 8883 |
|---|---|
| Purpose | Report information about transactions involving the deemed sale of corporate assets under section 338 of the U.S. Tax Code. |
| Filing Requirements | Attach it to the appropriate income tax return: the return of the old target, the return of the new target, or the return of the consolidated group that includes the acquisition date. Separate Forms 8883 must be filed for each target corporation when multiple targets are involved. |
| Additional Information | May also be used to make both section 338(g) and 338(h)(10) elections, and should be supplemented with increases or decreases in asset allocations. Penalties may be incurred if not filed correctly by the due date. |
Do You Need to File Form 8883 Each Year?
If an election is made under section 338 for a qualified purchase of stock of a target corporation, both the old target corporation and the new target corporation need to file Form 8883. Generally, the form is attached to the income tax return in which the effects of the section 338 deemed sale and purchase are reported. Supplemental Form 8883 may also need to be filed for individual cases when the amount allocated to any asset is increased or decreased. If Form 8883 is not filed correctly by the due date, without reasonable cause, there may be penalties. For multiple targets with the same acquisition date, one Form 8023 may be used, but a separate Form 8883 must be filed for each target corporation.
Download the official IRS Form 8883 PDF
On the official IRS website, you will find a link to download Form 8883. 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 8883
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