Form 1028 – Fill Out and Use This PDF

The Form 1028 serves as an application for agricultural cooperatives seeking recognition of exemption under Section 521 of the Internal Revenue Code. It is specifically designed for farmers', fruit growers', or like associations to establish their status as cooperatives exempt from certain taxes. Detailed information about the organization's structure, activities, operational information, and financial data is required to ensure compliance and gain approval. For those eligible organizations ready to secure their tax-exempt status, click the button below to begin the application process.

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Form 1028 PDF Details

Applying for tax-exempt status involves navigating through various forms and regulations, and for farmers', fruit growers', or similar associations looking to be recognized as cooperatives, this process includes filling out Form 1028. Issued by the Department of the Treasury's Internal Revenue Service, its latest revision dates back to October 1999. The purpose of Form 1028 is to help these associations obtain recognition of exemption under Section 521 of the Internal Revenue Code. It's crucial that these organizations have their organizing documents in order before applying, as these are mandatory for the application process. The form requires detailed information about the organization, including identification, the type of entity, organizational documents, and thorough insight into their operational activities. From detailing the number of shares of each class of stock and their respective dividends to explaining how patronage dividends are allocated and distributed, the form covers various aspects of a cooperative's functioning. It also explores the association’s interactions with members and nonmembers, laying a framework for understanding its operational and financial structure. Submitting this form is just one step in the journey toward tax exemption, but it's a crucial one, ensuring that all necessary information is provided to make an informed decision. Moreover, if the form is not accompanied by the required documentation and Form 8718 with the appropriate user fee, the application may face delays or be returned, underscoring the need for meticulous attention to detail throughout the application process.

Question	Answer
Form Name	Form 1028
Form Length	4 pages
Fillable?	No
Fillable fields	0
Avg. time to fill out	1 min
Other names	nonmembers, 1028 tax form, Nonproducers, 35d

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Form 1 0 2 8

(Rev. October 1999)

Department of the Treasury Internal Revenue Service

Application for Recognition of Exemption

Under Section 521 of the Internal Revenue Code

For the use of farmers’, fruit growers’, or like associations applying for recognition of

exemption as cooperatives.

▶See separate Instructions.

OMB No. 1545-0058

If your organization does not have an organizing document, do not file this application. Every organization must furnish all the information specified on the form and in the instructions. An attachment may be used if more space is needed for any item. If the required information and appropriate documents are not submitted along with Form 8718 (with payment of the appropriate user fee), the application may be returned to you.

Part I Identification

1a Full name of organization (See instructions.)

bEmployer identification number (See instructions.)

2a Number, street, and room or suite no. (or P.O. box number if mail is not delivered to street address)

b City or town, county, state, and ZIP code

3Name and telephone number (including area code) of person to be contacted during business hours

( )

4Date incorporated or formed

5Month the annual accounting period ends

6a Has the organization filed Federal income tax returns?

b If “Yes,” state the form numbers, years filed, and Internal Revenue office where filed ▶

Yes

Part II Type of Entity and Organizational Documents (See instructions.)

Check the applicable entity box below and attach a conformed copy of the organizing and operational documents listed.

Corporation—Articles of Incorporation, bylaws Other—Constitution or Articles of Association, bylaws

Part III Activities and Operational Information

1Number of shares of each class of capital stock currently outstanding, if any, the value of the consideration for which issued,

	and the rate of dividend paid:		Shares	Amount		Rate of Dividend
a	Preferred stock (voting)	1a
b	Preferred stock (nonvoting)	1b
c	Common stock (voting)	1c
d	Common stock (nonvoting)	1d
2	Number of shares of capital stock (other than nonvoting preferred) owned by:
a	Producers				2a
b	Nonproducers				2b
c	Current and active producers				2c
d	Total number of shares—Add lines 2a and 2b				2d
e	Percentage owned by current and active producers—Divide line 2c by line 2d				2e	%

3What provision is made for retiring the voting stock held by a nonproducer?

4Describe who is accorded voting rights in the cooperative and how many votes one person may have. If a person may be entitled to more than one vote, explain in detail how voting rights are acquired.

5 Legal rate of interest in the state where the association is located

▶

Please

Sign

Here

Under penalties of perjury, I declare that I am authorized to sign this application on behalf of the above organization; and I have examined this application, including the accompanying statements, and to the best of my knowledge and belief it is true, correct, and complete. (See General Instruction “C.”)

▶

(Signature)(Title or authority of signer)(Date)

For Paperwork Reduction Act Notice, see page 2 of the separate instructions.

Cat. No. 17138N

Form 1028 (Rev. 10-99)

Form 1028 (Rev. 10-99)		Page 2

Part III	Activities and Operational Information ( Continued)

6If the association issues any nonvoting preferred stock, explain whether the owners, upon dissolution or liquidation, may participate in the profits of the association beyond fixed dividends.

7a Does state law require the accumulation and maintenance of reserves?

b If “Yes,” state the names and purposes of the reserves and enter the amount of each:

Yes

Amount

8a Does the association maintain or plan to maintain any reserve or reserves other than those required by state law?

b If “Yes,” state the names and purposes of the reserves and enter the amount of each:

Yes

Amount

9	Does the association deal or plan to deal with both members and nonmembers?	Yes	No
10a	Does the association pay or plan to pay patronage dividends?	Yes	No
b	If “Yes,” are they paid or will they be paid to all patrons, both member and nonmember, on the same basis?	Yes	No
11a	Is the allocation of patronage dividends based on an obligation in existence before the cooperative
	received the amounts allocated?	Yes	No

bIf “Yes,” is the obligation in:

Organizing document (specify) ▶

Bylaws

12Explain all of the activities in which the association is or will be engaged.

13Explain how distribution is or will be made of the proceeds of products marketed for members and nonmembers. Also, if the organization operates on a basis of allocated units (i.e., functional, departmental, etc.), explain how losses are or will be treated.

14 Explain how the association charges for supplies and equipment bought for members and nonmembers.

Form 1028 (Rev. 10-99)

Form 1028 (Rev. 10-99)		Page 3

Part III	Activities and Operational Information ( Continued)

15 Explain the requirements for membership in the association.

16Federated cooperatives only:

aAre all the association’s member cooperatives exempt under section 521?

bIf “No,” do the nonexempt member cooperatives have the same annual accounting period as the association’s?

Yes

cIf “No,” to 16b, check the method below that the association used, or will use, to provide a common or comparable unit of time for analyzing and evaluating its operations and those of its members.

Note: Methods listed below do not apply to the filing of retur ns or the manner in which operating results are reported by a federated cooperative and its members.

Method 1—The association uses the operations of members for those months that correspond to the months that make up its tax year.

Method 2—The association uses the tax years of members that end within its tax year. Method other than 1 or 2 above (explain) ▶

17	Value of agricultural products marketed or handled	Current tax		3 prior tax years
17	Value of agricultural products marketed or handled
	for: (See instructions.)	year
	for: (See instructions.)	year
		(a) From	(b)	(c)	(d)
*a	Members—	to

1.Actually produced by members

2.Not actually produced by members but marketed by them through the association

bNonmembers—

1.Actually produced by nonmembers

2.Not actually produced by nonmembers but marketed by them through the association

cNonproducers (purchased from nonproducers for marketing by the association)

18Value of supplies and equipment purchased for or sold to: (See instructions.)

*a Members who were producers

bNonmembers who were producers

cMembers and nonmembers who were not producers

19Amount of business done with the United States Government or any of its agencies

20	Does the association plan to do business with the United States Government or any of its agencies in the future?	Yes	No
21a	Were all of the net earnings (after payment of dividends, if any, on capital stock) for the years shown on
	lines 17–19 distributed as patronage dividends? (See instructions for lines 17–19.)	Yes	No
b	If “No,” were undistributed net earnings apportioned on the records to all patrons on a patronage basis?	Yes	No
22a	Has the organization operated in a manner consistent with the information given since the date formed?	Yes	No

bIf “No,” state the changes that have occurred and dates of the changes.

*If it is necessary to own one or more shares of stock in order to become a member, include on lines 17a and 18a only the amount of business transacted with persons actually owning the required number of shares.

Form 1028 (Rev. 10-99)

Form 1028 (Rev. 10-99)		Page 4
Part IV	Financial Data (See instructions.)

Complete the Statement of Receipts and Expenditures and Balance Sheets for the current year and for each of the three immediately preceding years that the organization was in existence.

Statement of Receipts and Expenditures, for period ending													,		.
	(If you prepare a statement of receipts and expenditures that is more descriptive and detailed than the statement below, you
	may submit that statement instead of this one.)
		1	Gross dues and assessments from members										1
		2	Gross dues and assessments from affiliated organizations										2
		3a	Gross amount derived from activities related to organization’s exempt						3a
			purpose (attach schedule)						3a
Receipts		b Less cost of goods sold							3b	(		)	3c
		4a	Gross amount from other business activities (attach schedule)						4a
		b	Less cost of goods sold						4b	(		)	4c
		5a	Gross amount received from sale of assets, excluding inventory items
			(attach schedule)						5a
		b Less cost or other basis and sales expense of assets sold (attach schedule)							5b	(		)	5c
		6	Interest, dividends, rents and royalties										6
		7	Other receipts (attach schedule)										7
		8	Total receipts—Add lines 1 through 7 in far right column										8
		9	Compensation of officers, directors, and trustees (attach schedule)										9
		10	Other salaries and wages										10
Expenditures		11	Interest										11
		12	Rent										12
		13	Depreciation and depletion										13
		14	Dues and assessments to affiliated organizations										14
		15	Other expenditures (see instructions—attach schedule)										15
		16	Patronage dividends (see instructions—attach schedule)										16
		16	Patronage dividends (see instructions—attach schedule)										16
		17	Total expenditures—Add lines 9 through 16										17
		18	Excess of receipts over expenditures (line 8 less line 17)										18
Balance Sheets								Enter				Beginning date			Ending date
Balance Sheets								dates ▶
								dates ▶
		19	Cash							19
		20	Trade notes and accounts receivable (less allowance for bad debts)							20
		21	Inventories							21
Assets		22	Investments (attach schedule)							22
		23	Other current assets (attach schedule)							23
		24	Depreciable and depletable assets (less accumulated depreciation/depletion)							24
		24								24
		25	Land (net of any amortization)							25
		26	Other assets (attach schedule)							26
		27	Total assets							27
		28	Accounts payable							28
		29	Mortgages, notes, bonds payable in less than one year							29
		30	Other current liabilities (attach schedule)							30
		31	Mortgages, notes, bonds payable in one year or more							31
		32	Other liabilities (attach schedule)							32
Capital		33	Patronage dividends allocated in noncash form, other than capital stock and
			interest-bearing obligations							33
		34	Per-unit retains allocated in noncash form							34
and		35	Capital stock (enter numbers at			Number of shares
		35	Capital stock (enter numbers at		Number of
			end of year):		Number of	Issued for		Issued as
					shareholders
Liabilities					shareholders
						money	patronage benefits

		a Voting preferred stock		35a
		b Nonvoting preferred stock		35b
		c Voting common stock		35c
		c Voting common stock		35c
		d Nonvoting common stock		35d
		36	Paid-in or capital surplus							36
		37	Retained earnings (attach schedule)							37
		38	Less cost of treasury stock							38	(		)	(	)
		39	Total liabilities and capital							39

Form 1028 (Rev. 10-99)

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what is form 1028 empty spaces to fill out

Include the expected information in the a b c d, a b c d e, Number of shares of each class of, Rate of Dividend, Amount, Shares, Preferred stock voting Preferred, a b c d, Number of shares of capital stock, a b c d e, What provision is made for, Describe who is accorded voting, entitled to more than one vote, Legal rate of interest in the, and cid area.

You'll need to give some data in the box If the association issues any, Does state law require the, If Yes state the names and, Yes Amount, a Does the association maintain or, state law, If Yes state the names and, Does the association deal or plan, a Does the association pay or plan, If Yes are they paid or will they, Yes Amount, Yes Yes Yes, and No No No.

The a Is the allocation of patronage, received the amounts allocated If, Organizing document specify cid, Explain all of the activities in, Yes, and Explain how distribution is or field is the place where both parties can place their rights and obligations.

End by reviewing these fields and submitting the required information: Explain how the association, and Form Rev.

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