Instruction 1028 — Instructions for Form 1028, Application for Recognition of Exemption Under Section 521 of the Internal Revenue Code

Official source: IRS Forms, Instructions & Publications (https://www.irs.gov/pub/irs-pdf/i1028.pdf), retrieved 2026-10-03. U.S. Government work (17 U.S.C. § 105).

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Department of the Treasury Internal Revenue Service

Section references are to the Internal representative to act in person or by ruling recognizing its exemption under

Revenue Code unless otherwise noted. correspondence. Send the power of section 521 of the Internal Revenue Code

attorney with the application when you file of 1986 or corresponding provisions of it. Use Form 2848, Power of Attorney and prior law.

Every attachment should state that it The Internal Revenue Service is required Form 1028 may be used by a farmers’ relates to Form 1028 and identify the to collect a fee from any organization cooperative to apply for recognition of applicable part and line item number. The seeking an IRS determination of its exempt status under section 521. A attachments should also show the exempt status as an organization farmers’ cooperative, as defined in organization’s name, address, and described in section 521. A fee also section 521, is an association of farmers, employer identification number (EIN), and applies to any exempt organization’s fruit growers, or persons with similar be on 8 ¹ /2’’ x 11’’ paper. request for a private letter ruling. occupations that is organized and

operated on a cooperative basis. In addition to the required documents The nonrefundable fee must be

and statements, include any additional submitted with the application or ruling

Send the completed application, all processing of the application. Generally, on it. required information, and Form 8718, attachments in the form of tape The fees are shown in Form 8718, User Fee for Exempt Organization recordings are not accepted unless which is used to transmit both the Determination Letter Request, with the accompanied by a transcript. appropriate fee and the application or appropriate user’s fee, to the address ruling request. User fees are subject to shown in the Instructions to Form 8718.

will be advised of the Internal Revenue An organization that is recognized as gov and type “User Fee” in the keyword Service’s determination and of the annual exempt from income tax under section box, or call Customer Account Services at returns that the organization will be 521 must file an annual return on Form 1-877-829-5500 for current information.

required to file. 1120-C, U.S. Income Tax Return for

Cooperative Associations. An

If an agent or attorney will represent the the provisions of sections 521 and 1381

attorney, specifically authorizing the application or has previously received a Line 1a—Organization’s Name. Enter Make sure the application is complete. Remember to... the organization’s name as it appears in its organizing documents, including 1. Complete all parts of the application. amendments. If the organization will be 2. Show the employer identification number (EIN): operated under another name, show that a. If the organization has one, put it on line 1b. name in parentheses. b. If the organization doesn’t have an EIN, you must apply for one (see the Specific Instructions for Part I, line 1b). Line 1b—Employer Identification 3. Enclose financial statements (see the Specific Instructions for Part IV): Number (EIN). Enter the organization’s a. Current year (must include the period that is within 60 days of the application’s filing EIN. If the organization does not have an date) and 3 preceding years. EIN, it must apply for one. An EIN can be b. Detailed breakdown of receipts and expenditures — no lump sums. applied for: 4. Include a conformed copy of the complete organizing instrument and a copy of the - Online—Click on the EIN link at www. bylaws. irs.gov/businesses/small . The EIN is a. An organizing instrument means: issued immediately once the application 1) Articles of incorporation information is validated. a) Signed by the incorporators, and - By telephone at 1-800-829-4933 from b) Signed by an appropriate government official, or 8:00 a.m. to 8:00 p.m. in the local time 2) Constitution of articles of association (signed). zone. b. A conformed copy is one that agrees with the original and all amendments to it.

• By mailing or faxing Form SS-4,

5. Enclose Form 8718 and appropriate user fee (see General Instruction F). Application for Employer Identification 6. Have the application signed by one of the following: a. An officer, Number. b. A director, or If the organization has not received its c. A person having power of attorney (submit the power of attorney too). EIN by the time the return is due, enter 7. Give the name and phone number of someone we can call during normal business “Applied for” in the space for the EIN. For hours if we need additional information (Part I, line 3). more details, see Pub. 583.

Cat. No. 17139Y

and equipment through the cooperative securities, or from the sale or exchange of

One of the basic requirements for sources other than patronage.

“organized” for one or more exempt The statement of receipts and amount of per-unit retain allocations other purposes. If the organization does not expenditures and the balance sheets than those reflected in cost of sales on have an organizing instrument, it will not must be completed for the current year line 3b and the total amount of written qualify for exempt status. and each of the 3 immediately preceding notices of allocation other than those

None of the documents submitted in years (or for the time the organization has reflected on line 16. (See sections 1382

support of this application, including existed if less than 4 years). We may and 1388.)

organizational documents, will be request financial data for more than 4 Line 16—Patronage Dividends. In the returned. years if circumstances warrant. All attached schedule, show the amount of Instead of the originals, submit financial information for the current year patronage dividends paid to patrons in “conformed” copies of these documents. must cover the period beginning on the money, qualified written notices of A “conformed” copy is one that agrees first day of your organization’s established allocation, or other property (except with the original document and all of its annual accounting period and ending on non-qualified written notices of allocation) amendments. If the copies are not signed, any day which is within 60 days of the and the amount paid to patrons in money they must be accompanied by a date of the application. If the date of the or other property (except written notices declaration signed by an officer application is less than 60 days after the of allocation) to redeem nonqualified authorized to sign for the organization, first day of the current accounting period, written notices of allocation. (See sections certifying that they are complete and no financial information is required for the 1382 and 1388 and the related accurate copies of the original current year. Financial information is regulations.) documents. required for the 3 preceding years regardless of the current year Paperwork Reduction Act Notice. We Chemically or photographically requirements. Please note that if no ask for the information on this form to reproduced copies of articles of financial information is required for the carry out the Internal Revenue laws of the incorporation showing the certification of current year, the preceding year’s United States. If you want your an appropriate government official need financial information can end on any day organization to be recognized as not be accompanied by a declaration. which is within 60 days of the date of the tax-exempt by the IRS, you are required

You may reproduce page 4 of the form meets the legal requirements for

tax-exempt status. required year. Attach the financial data for Lines 17 through 19. The information all required years to the application. You are not required to provide the requested on lines 17 through 19 must be information requested on a form that is completed for the current year and each The statements should be consistent subject to the Paperwork Reduction Act of the 3 immediately preceding years (or with the method of accounting the unless the form displays a valid OMB for the time the organization has existed if organization uses in maintaining its books control number. Books or records relating less than 4 years). The requested and records. to a form or its instructions must be information for the current year must Line 3b—Cost of Goods Sold. Include retained as long as their contents may cover the period beginning on the first day per-unit retain allocations paid to patrons become material in the administration of of your organization’s established annual in money, qualified written notices of any Internal Revenue law. Generally, tax accounting period and ending on any day allocation, or other property (except returns and return information are which is within 60 days of the date of the nonqualified per-unit retain certificates) confidential, as required by section 6103. application. If the date of the application is and the amount paid to patrons in money less than 60 days after the first day of the or other property (except per-unit retain The time needed to complete and file current accounting period, no information certificates) to redeem nonqualified this form will vary depending on individual is required for the current year. per-unit retain certificates. (See sections circumstances. The estimated average Requested information is required for the 1382 and 1388.) time is: 3 preceding years regardless of the Line 15—Other Expenditures. In the current year requirement. Please notethat if no information is required for the attached schedule for other expenditures,include a breakdown for nonpatronage RecordkeepingLearning about the law orthe form . . . . . .. .. .. .. .. .. .. .. .. 44 hr., 14 min.1 hr., 44 min. current year, the preceding year’s distributions paid as dividends on capital Preparing the form . . . . . . . 4 hr., 23 min. information period can end on any day stock and nonpatronage distributions Copying, assembling, and which is within 60 days of the date of the made on a patronage basis. This sending the form to the IRS 32 min. application. breakdown should include only

Definitions. The term “producer” means distributions of earnings derived from If you have comments concerning the

an individual or corporation engaged in business done for the United States accuracy of these time estimates or

farming as a business receiving income Government or any of its agencies or suggestions for making this form simpler,

based on farm production rather than income from sources other than we would be happy to hear from you. You

fixed compensation. For example, a patronage, but only to the extent such can write to the Internal Revenue Service,

corporation leases its land to a tenant amounts are paid in the same manner Tax Products Coordinating Committee,

farmer who agrees to pay a rental fee provided for patronage dividends below. SE:W:CAR:MP:T:T:SP, 1111 Constitution

based on a percentage of the farm crops The term “income from sources other Ave. NW, IR-6406, Washington, DC

produced. Both the landowner and the than patronage” means incidental income 20224. Do not send the tax form to this

tenant farmer qualify as producers. derived from sources not directly related address. Instead, see Where To File on

“Current and active” producers are to the marketing, purchasing, or service page 1.

patrons of a cooperative who market activities of the cooperative association.

more than 50% of their products or For example, income derived from the

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