Form 1139 (Rev. October 2018) — Checklist for 2018 Tax Year
Purpose of Form 1139
Form 1139 allows corporations to request a tentative refund by carrying back net operating losses, capital losses, or general business credits to prior tax years. For 2018, corporations must account for TCJA-modified taxable income calculations, including the base erosion minimum tax requirement on line 18. The carryback periods and computational rules differ substantially from the pre-2018 law due to the Tax Cuts and Jobs Act changes.
Filing Requirements and Timing
Corporations must file Form 1139 within 12 months of the end of the tax year in which the NOL, net capital loss, unused credit, or claim of right adjustment arose. The income tax return for the tax year must be filed no later than the date Form 1139 is submitted.
Do not attach the income tax return itself to this application. File the return separately before or simultaneously with Form 1139.
Required Documentation
Attach the following items to Form 1139 if applicable for the year of the loss or credit:
- The first two pages of the corporation's income tax return.
- All forms and schedules from which a carryback results, such as Schedule D (Form 1120) or Form 3800.
- All Forms 8886 (Reportable Transaction Disclosure Statement) are attached to the corporation's tax return.
- Any applicable election statements as required under the instructions.
- All carryback year forms and schedules for which items were refigured.
- Form 8991 and supporting computation if the base erosion minimum tax applies.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
Line-by-Line Completion Requirements
Complete line 1 by identifying whether the carryback claim rests on a 2018 NOL, net capital loss, unused general business credit under 2018 post-TCJA definitions, or section 1341(b)(1) overpayment. Attach detailed computation support for all carryback claims.
Enter on line 2 the complete tax year ending date and original filing date for the 2018 return claiming the loss or credit. You must confirm the applicable service center where the original return was filed.
On line 4, determine whether the 2018 loss triggered the release of a foreign tax credit under TCJA consolidated return rules. If the answer is yes, you must file amended returns for carryback years separately per the 2018 instructions rather than using Form 1139.
Address line 5a by indicating whether the corporation filed a consolidated return in 2018 or any carryback year. If yes, provide the common parent name, EIN, and year-end date on line 5b.
Taxable Income Recalculation
For lines 11 through 15, recalculate 2018 taxable income using TCJA provisions by excluding the deduction for net operating losses under section 172(a) limits. Capital loss carrybacks follow 2018 NOL carryback year restrictions as specified in the current instructions.
Complete lines 16 through 26 using 2018 tax rates, which reflect the corporate rate now flat at 21 percent under section 11. Line 17 requires no corporate alternative minimum tax entry for 2018 because TCJA permanently repealed corporate AMT for tax years beginning after December 31, 2017.
On line 18, attach Form 8991 and compute the base erosion minimum tax if the corporation meets the 2018 BEAT applicability thresholds. This line did not appear on prior-year forms and is mandatory for 2018 filings when applicable.
Line 20 permits only general business credits allowable under the 2018 rules. Do not include credits suspended or eliminated by TCJA. Line 24 requires the inclusion of personal holding company tax only if the 2018 return reported Schedule PH income.
This line applies regardless of which carryback year you are computing. Verify the line 28 decrease in tax by subtracting the after-carryback column totals from the original tax liability for each carryback year. This calculation produces the refund amount claimed.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
2018 Tax Year Changes Under TCJA
Net Operating Loss Provisions
- For losses incurred in tax years ending after December 31, 2017, the NOL carryback applies only to farming losses and losses from insurance companies other than life insurance companies.
- The TCJA eliminated general NOL carrybacks for all other corporations.
- NOLs arising in tax years ending after December 31, 2017, can be carried forward indefinitely for most taxpayers.
- The NOL deduction limitation applies to tax years beginning after December 31, 2017, but the 80 percent of taxable income restriction takes effect only for tax years beginning after December 31, 2020.
Corporate Tax Structure Changes
- The base erosion minimum tax introduced under TCJA, effective for 2018, requires line 18 completion with Form 8991 attachment if applicable.
- The corporate income tax rate was permanently reduced to a flat 21 percent under section 11, effective for tax years beginning after December 31, 2017.
- The corporate alternative minimum tax was permanently repealed for tax years beginning after December 31, 2017, eliminating all line 17 entries for 2018 returns.
- The foreign tax credit release rules were clarified in the 2018 instructions for consolidated return filers with specific line 4 and line 5 cross-references.
- The section 1341(b)(1) claim of right adjustment option is emphasized as an alternative carryback claim pathway on line 2 and line 29.
Signature and Authorization
Sign and date the form as an authorized officer per the 2018 signature rules. A paid preparer must include their PTIN and firm EIN if applicable. The IRS will process complete applications within 90 days of the later of the filing date or the last day of the month that includes the return's due date.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
