What Form 1139 (2013) Is For
IRS Form 1139 (2013) allows corporations—other than S corporations—to apply for a tentative refund when specific tax adjustments reduce previously paid taxes. It provides a faster method for obtaining refunds compared to filing an amended return.
Corporations typically use this form when they experience a net operating loss, a net capital loss, an unused general business credit, or a claim of right to a property. By filing Form 1139, an eligible corporation may receive its refund within about 90 days, which can improve cash flow and support business stability.
When You’d Use Form 1139
Corporations use Form 1139 when they need a quick refund for overpaid corporate income tax due to a net operating loss, net capital loss, or unused general business credit from the current tax year. The form allows a company to offset prior taxable income, improving cash flow and helping maintain stability after a financial downturn.
This corporation application must be filed within 12 months after the end of the tax year in which the loss or credit occurred. Corporations that miss this window can still recover overpayments by filing Form 1120X, an amended return, though it lacks the fast refund processing available through Form 1139.
Key Rules or Details for 2013
Net Operating Loss (NOL) Carrybacks
- Most net operating losses could be carried back for two years to recover previously paid corporate income tax.
- Farming losses and disaster-related losses could be carried back for five years under special federal revenue provisions.
- Specified liability losses, including product liability and environmental cleanup expenses, had a ten-year carryback period.
- Small business disaster losses could be carried back for three years to offset taxable income from earlier tax years.
Waiving the Carryback
Corporations could elect to forgo the carryback and carry the loss forward instead. The election had to appear on a timely-filed return and was irrevocable once made.
Net Capital Loss Carrybacks
Capital losses could be carried back three years, but would not create or increase a net operating loss in the carryback year.
General Business Credit (GBC) Carrybacks
Most unused credits could be carried back one year, but certain small-business credits under the Small Business Jobs Act qualified for a five-year carryback.
Computation Adjustments
When computing the NOL for 2013, the domestic production activities deduction and any prior NOL deductions were excluded to ensure an accurate calculation of taxable income.
Step-by-Step (High Level)
1. Prepare the Loss-Year Return
File the complete 2013 corporate tax return before submitting Form 1139. This confirms the amount of loss or credit available for carryback.
2. Identify the Carryback Years
Determine which prior years will absorb the loss or credit. For a 2013 two-year carryback, apply it first to 2011 and then to 2012 if any balance remains.
3. Gather Required Attachments
Include supporting documentation such as:
- The first two pages of the 2013 corporate return
- Schedules that support the carryback (Schedule D, Form 3800, etc.)
- Refigured computations for each carryback year, showing taxable income and credits
4. Complete Form 1139
Enter corporate information accurately and specify the amount and type of loss or credit carried back. Recalculate taxable income, regular tax, alternative minimum tax, and credits for each carryback year.
5. Sign and Submit Separately
An authorized corporate officer must sign the form. Mail it separately to the IRS Service Center where the corporation files its regular return.
6. Await Processing
The IRS processes Form 1139 within 90 days of the filing date or the last day of the month containing the original return’s due date, whichever is later.
Learn more about federal tax filing through our IRS Form Help Center.
Common Mistakes and How to Avoid Them
Filing Form 1139 with the Tax Return
Form 1139 must be filed separately. Including it with the corporate tax return can delay the processing of the application.
Missing Attachments
Applications missing required documents, such as carryback schedules or refigured calculations, may be disallowed. All supporting pages should be attached before submission.
Incorrect NOL Calculations
Common errors include adding prior NOL deductions or failing to exclude the domestic production activities deduction. Recheck all adjustments before filing.
Late Filing
Form 1139 must be submitted within 12 months after the end of the tax year in which the loss occurred. Missing this deadline requires filing Form 1120X, which is a more complex and time-consuming process.
Misapplied Carrybacks
Losses must offset the earliest eligible year first. Applying them out of order can trigger corrections or disallowance by the IRS.
Overlooking Alternative Minimum Tax Recalculation
Refiguring AMT for each carryback year is required. Attach Form 4626 for every affected year.
Consolidated Return Issues
Corporations within a consolidated group must follow allocation rules. Refunds are generally issued to the parent corporation's standard account.
Learn more about how to avoid business tax problems in our guide on How to File and Avoid Penalties.
What Happens After You File
After filing, the IRS generally processes Form 1139 within 90 days, issuing a quick refund for verified overpayments. The approved refund enhances business liquidity while aligning with federal revenue procedures under U.S. tax law.
However, the refund is tentative. The Internal Revenue Service may later review or audit the calculation, and any errors found—such as misreported deductions or income—can result in repayment with interest. Corporations should maintain detailed tax records to verify compliance and support future tax returns.
FAQs
What is IRS Form 1139 (2013) used for?
IRS Form 1139 (2013) helps corporations claim a quick refund for overpaid corporate income tax from a prior tax year. It allows a business to offset taxable income using a net operating loss or unused general business credit.
How does Form 1139 benefit corporations filing amended returns?
Filing Form 1139 provides corporations a faster way to recover overpayments compared to filing an amended return. It supports improved cash flow while complying with corporate tax rules under the Internal Revenue Code and other federal revenue laws.
Can a corporation claim a net capital loss or proper adjustment on Form 1139?
Yes, resident corporations may use Form 1139 to apply a net capital loss or claim of proper adjustment to earlier tax years, reducing previously taxed profits and generating a tentative refund from the Internal Revenue Service.
How does Form 1139 affect taxable income and business deductions?
Form 1139 recalculates taxable income for earlier tax years after a corporation reports new deductions, losses, or credits. It adjusts prior tax returns to correct overpayment, aligning with laws governing corporate tax and general taxation systems.
What is the difference between Form 1139 and the corporate tax return Form 1120X?
Form 1139 allows for a tentative refund to be processed quickly, while Form 1120X is used for a full amended return to address formal claims. The advantage of Form 1139 lies in expedited review and earlier recovery of business revenue and tax benefits.
Where can corporations find additional information or official forms for filing?
Corporations should visit IRS.gov to download the official forms and instructions. The page last reviewed or updated includes the latest modified version of Form 1139, relevant calculation rules, and additional information about federal taxation and deductions.
