We have been seeing 1099-PATR forms coming in with a number in Box 3 (Per-unit retain allocations). Having never seen a number in this box before I did some research and found that the COOP is using this to enable them to claim the Production Activities Credit for the sale of grain.
In doing this the farmer can’t use the same grain sales to claim the credit. Most of my farmers don’t pay wages so it doesn’t really matter. The concern is that if this number isn’t reported the IRS will send a notice. I have been adding Box 1 and Box 3 together and report that total on 5a of Schedule “F” with the Box 1 amount on 5b. The grain sales represented by the number in Box 3, I report on Line 4 as always. Don’t know how many farm returns the other poster’s here prepare but you might want to watch out for this.
In doing this the farmer can’t use the same grain sales to claim the credit. Most of my farmers don’t pay wages so it doesn’t really matter. The concern is that if this number isn’t reported the IRS will send a notice. I have been adding Box 1 and Box 3 together and report that total on 5a of Schedule “F” with the Box 1 amount on 5b. The grain sales represented by the number in Box 3, I report on Line 4 as always. Don’t know how many farm returns the other poster’s here prepare but you might want to watch out for this.