§1.7519-1T   Required payments for entities electing not to have required year (temporary).

(a) In general.

(1) Applicability.

(2) Returns and required payments.

(3) Required payment.

(4) Examples.

(b) Definitions and special rules.

(1) Applicable percentage.

(i) In general.

(ii) Exception for certain applicable election years beginning after 1987.

(iii) Example.

(2) Adjusted highest section 1 rate.

(i) General rule.

(ii) Period for determining highest section rate.

Base year.

(4) Special rules for certain applicable election years.

(i) First applicable election year of new entities.

(ii) Applicable election years ending prior to the required taxable year.

(5) Net base year income.

(i) In general.

(ii) Partnership net income.

(A) In general.

(B) Treatment of deductions and losses.

(C) Partner limitations disregarded.

(iii) S corporation net income.

(A) In general.

(B) Treatment of deductions and losses.

(C) Shareholder limitations disregarded.

(iv) Applicable payments.

(A) In general.

(B) Exceptions.

(C) Special rule for corporation electing S status.

(D) Special rules for certain payments.

(1) Certain indirect payments.

(2) Payments by a downstream controlled partnership.

(i) In general.

(ii) Definition of a downstream controlled partnership.

(3) Examples.

(v) Special rule for base year of less than twelve months.

(A) In general.

(B) Annualized short base year income.

(vi) Examples.

(c) Refunds of required payments.

(d) Examples.

§1.7519-2T   Required payments—procedures and administration (temporary).

(a) Payment and return required.

(1) In general.

(2) Return required.

(i) In general.

(ii) Procedure if amount for applicable election year (and all preceding years) is not greater than $500.

(3) Time and place for filing return.

(i) Applicable election years beginning in 1987.

(A) Taxpayers that would otherwise file Form 720 for the second quarter of 1988.

(B) Other taxpayers.

(ii) Applicable election years beginning after 1987.

(A) Return made on Form 720.

(B) Return made on form other than Form 720.

(iii) Special rule for back-up section 444 election.

(4) Time and place for making required payment.

(i) Applicable election years beginning in 1987.

(ii) Applicable election years beginning after 1987.

(iii) Special rule for back-up section 444 election.

(5) Penalties for failure to pay.

(6) Refund of required payment.

(i) In general.

(ii) Procedures for claiming refund.

(iii) Interest on refund.

(b) Assessment and collection of payment.

(c) Termination due to willful failure.

(d) Negligence and fraud penalties made applicable.

§1.7519.3T   Effective date (temporary).