Form 8736 (Rev. 10-2003) Page 2
Interest and Penalties
Forms 1041, 1041-N, 1041-QFT, 1065-B,
and 1066. The following interest and
penalties may be assessed:
Interest. Interest is charged on any tax not
paid by the regular due date of the return
from the due date until the tax is paid. It will
be charged even if the entity has been
granted an extension or has shown
reasonable cause for not paying on time.
Late payment penalty. Form 8736 does
not extend the time to pay any tax due.
Generally, a penalty of
1
⁄2 of 1% of any tax
not paid by the due date is charged for each
month or part of a month that the tax remains
unpaid. The penalty cannot exceed 25% of
the amount due. The penalty will not be
charged if the entity can show reasonable
cause for not paying on time.
Late filing penalty. A penalty is charged if
the return is filed after the due date (including
extensions) unless the entity can show
reasonable cause for not filing on time. The
penalty is 5% of the tax not paid by the
regular due date (even if an extension of time
to pay has been granted) for each month or
part of a month that the return is late, up to a
maximum of 25% of the unpaid tax. If the
return is more than 60 days late, the
minimum penalty is $100 or the balance of
the tax due on the return, whichever is
smaller.
Forms 1065, 1065-B, and 1066. A penalty
may be assessed against the partnership (or
REMIC) if it is required to file a return, but (a)
fails to file it on time, including extensions, or
(b) files a return that fails to show all the
information required, unless the entity can
show reasonable cause for not filing on time.
The penalty is $50 for each month or part of
a month (for a maximum of 5 months) the
failure continues multiplied by the total
number of partners (or residual interest
holders) in the partnership (or REMIC) during
any part of the partnership’s (or REMIC’s) tax
year. See the instructions for Form 1065,
1065-B, or 1066 for more information.
Specific Instructions
Address
Include the suite, room, or other unit number
after the street address. If the Post Office
does not deliver mail to the street address
and the entity has a P.O. box, show the box
number instead of the street address.
If the mailing address has changed since
the entity filed its last return, use Form 8822,
Change of Address, to notify the IRS of the
change. A new address shown on Form 8736
will not update the entity’s record.
Line 1
Check the box for the form filed by the entity
for which an extension is requested. A
separate Form 8736 must be filed for each
return. Check only one box.
Line 3b
Change in accounting period. Generally, a
partnership must conform its tax year to the
tax year of a majority of its partners, unless
the partnership can establish a business
purpose for a different period or makes a
section 444 election. See Pub. 538,
Accounting Periods and Methods, for details.
REMICs and trusts (other than trusts exempt
under section 501(a), section 4947(a)(1)
nonexempt charitable trusts, and trusts
treated as wholly owned by a grantor) must
use a calendar tax year.
Line 4a
Enter the total tax that the trust, electing
large partnership, or REMIC expects to owe
for the tax year. The total tax for the trust
consists of the regular income tax on the
taxable income of the trust, plus other taxes,
less allowable nonrefundable credits, plus
recapture taxes and alternative minimum tax.
The tax on Form 1065-B consists of tax due
from recapture of the investment and
low-income housing credits. The total tax for
REMICs consists of the sum of the tax on net
income from prohibited transactions, the tax
on net income from foreclosure property, and
the tax on contributions after the startup day.
Line 4b
For a trust, include in the amount entered on
line 4b all estimated tax payments, any
overpayment from the prior year that was
applied to the current year, any refundable
credits, and all Federal income tax withheld.
For an electing large partnership, include any
credit for Federal tax paid on fuels and the
credit for tax paid on undistributed long-term
capital gains shown on Form 2439, Notice to
Shareholder of Undistributed Long-Term
Capital Gains.
Line 4c
A trust, electing large partnership, or REMIC
can still get an extension even if it cannot pay
the full amount shown on line 4c. But it
should pay as much as it can to limit the
amount of interest it will owe. Also, a late
payment penalty may be charged on the
unpaid tax from the regular due date of its
return. If the trust, electing large partnership,
or REMIC makes a payment, make the check
or money order payable to “United States
Treasury.” Write its employer identification
number, tax year to which the payment
applies, and “Form 8736” on the payment.
Enclose, but do not staple or attach, the
payment with Form 8736.
Paperwork Reduction Act Notice. We ask
for the information on this form to carry out
the Internal Revenue laws of the United
States. You are required to give us the
information. We need it to ensure that you are
complying with these laws and to allow us to
figure and collect the right amount of tax.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB control
number. Books or records relating to a form
or its instructions must be retained as long as
their contents may become material in the
administration of any Internal Revenue law.
Generally, tax returns and return information
are confidential, as required by section 6103.
The time needed to complete and file this
form will vary depending on individual
circumstances. The estimated average time
is:
Recordkeeping 2 hr., 23 min.
Learning about the
law or the form 47 min.
Preparing, copying,
assembling, and sending
the form to the IRS 52 min.
If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler, we
would be happy to hear from you. You can
write to the Tax Products Coordinating
Committee, Western Area Distribution Center,
Rancho Cordova, CA 95743-0001. Do not
send Form 8736 to this address. Instead, see
Where To File on page 1.
