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If you received a Form 1099-PATR Taxable Distributions Received From Cooperatives, below is the information you will need to help you determine if the amount needs to be entered on your return. If the purchases you made from the cooperative were only for personal items, please note the instructions from IRS Publication 225 below.

Per the IRS Instructions for Form 1099-PATR:

Instructions for Recipient

Distributions you received from a cooperative may be includible in your income. Generally, if you are an individual, report any amounts shown in boxes 1, 2, 3, and 5 as income, unless nontaxable, on Schedule F (Form 1040), Schedule C(Form 1040), or Form 4835. See the Instructions for Schedule F (Form 1040) and Pub. 225 for more information.

Per IRS Publication 225 Farmer's Tax Guide, page 14:

Personal purchases. Because you can't deduct the cost of personal, living, or family items, such as supplies, equipment, or services not related to the production of farm income, you can omit from the taxable amount of patronage dividends on Schedule F, any dividends from buying those items (and you must reduce the cost or other basis of those items by the amount of the dividends). This rule also applies to amounts you receive from the sale, redemption, or other disposition of a nonqualified written notice of allocation resulting from these purchases.

To enter the data on Schedule C or Schedule F in the TaxAct program:

  1. From within your TaxAct return (Online or Desktop), click Federal and then click Business income 
  2. Select Business Income or loss from a sole proprietorship OR Farming Income or Loss 
  3. Click New Copy of Schedule C (Business Income or loss from a sole proprietorship) or New Copy of Schedule F (Farming Income or Loss) (Desktop users click Add) to create a new copy of the form or Review to review a form already created
  4. The program will proceed with the interview questions for you to enter or review the appropriate information

If entering the information from Form 1099-PATR on the Schedule F: Enter the amounts on the screen titled Farm Income - Cooperative Distributions. As you will see, there are two fields for Total Received and Taxable Amount. You can determine the Taxable Amount by subtracting the dividends from purchasing personal items (as mentioned in the excerpt above from Pub. 225) from the Total Received.

If entering the information from Form 1099-PATR on the Schedule C: Enter the amounts on the screen titled Business Income - Other Income which will transfer to Schedule C, Line 6. If you purchased personal items as mentioned in the excerpt from Pub. 225 above, subtract the dividends from purchasing personal items and only enter the NET amount in the Other Income field.

To enter the data on Form 4835 for farm rental in the TaxAct program:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click the menu icon in the upper left-hand corner, then select Federal
  2. Click Rent or Royalty Income in the Federal Quick Q&A Topics menu to expand the category and then click Farm Rental for Crop Shares
  3. Click New Copy of Form 4835 (Desktop users click Add) to create a new copy of the form or click Review to review a form already created 
  4. The program will proceed with the interview questions for you to enter or review the appropriate information. Coop distributions are entered on the screen Farm Rental - Cooperative Distributions.

If there is Federal and/or State income tax withheld on the Form 1099-PATR, those amounts would be entered in the Form 1099-MISC section:

  1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click the menu icon in the upper left-hand corner, then select Federal.
  2. Click Form 1099-MISC in the Federal Quick Q&A Topics menu.
  3. Click New Copy of Form 1099-MISC (Desktop users click Add) to create a new Form 1099-MISC
  4. Click Form 1099-MISC Quick Entry to open the Quick Entry window
  5. Enter all of the applicable information from your Form 1099-MISC, including Box 4 or 16
  6. Close the Quick Entry window
  7. On the screen titled What schedule or form should the income from this Form 1099-MISC be reported on?, make the appropriate selection
  8. If you selected Other non-business income on the previous screen, check the box to confirm that the income is non-business income and is not subject to self-employment taxes

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