The 1028 form is the Internal Revenue Service (IRS) application that a farmers', fruit growers' or like cooperative association files to be recognized as exempt under section 521 of the Internal Revenue Code. It collects the organization's identity, organizing documents, stock, voting, patronage dividend and business information, and four years of financial data. On this page you can fill out Form 1028 online on FillingPDF and download or print the completed PDF; the form and its instructions are published by the IRS, and the application goes to the IRS with Form 8718 and the user fee.
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What is Form 1028?
Form 1028, Application for Recognition of Exemption Under Section 521 of the Internal Revenue Code, is the IRS form a farmers' cooperative uses to ask for recognition of exempt status as a cooperative under section 521. It is printed under OMB No. 1545-0058.
The IRS instructions define a farmers' cooperative as an association of farmers, fruit growers, or persons with similar occupations that is organized and operated on a cooperative basis. The form has four parts: Part I, Identification; Part II, Type of Entity and Organizational Documents; Part III, Activities and Operational Information (lines 1 through 22); and Part IV, Financial Data, which holds a statement of receipts and expenditures and balance sheets.
Completing and filing it, together with Form 8718 and the user fee, starts the IRS determination. The instructions say the IRS advises the organization of its determination, and of the annual returns it will have to file, soon after receiving the application. An organization recognized as exempt under section 521 files an annual return on Form 1120-C, U.S. Income Tax Return for Cooperative Associations.
The form does not stand alone: an organization that has no organizing document must not file it, and the application may be returned if the required information and Form 8718 with payment are not included.
Who needs to file Form 1028?
A farmers', fruit growers' or like cooperative association applying for recognition of exemption under section 521 uses Form 1028. The instructions say it may be used by a farmers' cooperative, meaning an association of farmers, fruit growers, or persons with similar occupations that is organized and operated on a cooperative basis.
Conditions and exclusions printed on the form and in the instructions:
- Do not file if the organization has no organizing document. The form says not to file the application in that case, and the instructions say such an organization will not qualify for exempt status.
- An organization is not considered exempt, even if it operates within sections 521 and 1381 through 1388, unless it files this application or has previously received a ruling recognizing its exemption.
- Lines 16a to 16c are for federated cooperatives only.
An officer, a director, or a person holding a power of attorney may sign the application. If an agent or attorney will represent the organization, a power of attorney must be filed with the application, using Form 2848, Power of Attorney and Declaration of Representative, or Form 8821, Tax Information Authorization.
When to file Form 1028
File Form 1028 when the cooperative wants the IRS to recognize its exempt status under section 521; the form and instructions print no separate due date. The instructions say an organization will not be considered exempt unless it files this application or has previously received a ruling recognizing its exemption.
Timing affects the financial data. Part IV and lines 17 through 19 must cover the current year and the 3 immediately preceding years, or the time the organization has existed if less than 4 years. The current-year period begins on the first day of the organization's established annual accounting period and ends on any day within 60 days of the application date. If the application date is less than 60 days after the first day of the current accounting period, no current-year information is required, but the 3 preceding years still are.
After the application is received, the instructions say the IRS will advise the organization of its determination soon after receipt. Once recognized, the organization files an annual return on Form 1120-C.
Documents you need
- Form 8718, User Fee for Exempt Organization Determination Letter Request, with the appropriate nonrefundable user fee; without them the application may be returned.
- A conformed copy of the organizing document: signed articles of incorporation for a corporation, or the signed constitution or articles of association for another entity.
- A copy of the bylaws, attached with the organizing document in Part II.
- A declaration signed by an officer authorized to sign, certifying the copies are complete and accurate, if the copies of the organizing documents are not signed.
- Statement of receipts and expenditures and balance sheets (Part IV) for the current year and each of the 3 preceding years, or the time the organization has existed if less than 4 years.
- Schedules for every line marked "attach schedule" in Part IV, such as lines 3a, 4a, 5a, 5b, 7, 9, 15, 16, 22, 23, 26, 30, 32 and 37.
- Form 2848, Power of Attorney and Declaration of Representative, or Form 8821, Tax Information Authorization, if an agent or attorney represents the organization.
- A transcript, if any attachment is a tape recording; the instructions generally do not accept recordings without one.
How to fill out Form 1028
Identify the organization in Part I
Line 1a: enter the name as it appears in the organizing documents, including amendments, and show any other operating name in parentheses. Line 1b: enter the EIN, or apply for one if the organization has none.
Enter address and contact details
Lines 2a and 2b: the street address (or P.O. box if mail is not delivered to the street) and the city, county, state and ZIP code. Line 3: the name and telephone number, with area code, of a person the IRS can call during business hours.
Enter dates and filing history
Line 4: date incorporated or formed. Line 5: month the annual accounting period ends. Line 6a: check Yes or No for prior federal income tax returns; for Yes, line 6b asks for the form numbers, years filed and office where filed.
Select entity type in Part II
Check Corporation (articles of incorporation, bylaws) or Other (constitution or articles of association, bylaws), and attach a conformed copy of the listed organizing and operational documents.
Report stock and ownership (lines 1 and 2)
Line 1: shares, amount and rate of dividend for each class of preferred and common stock, voting and nonvoting. Lines 2a to 2c: shares owned by producers, nonproducers and current and active producers; line 2d is 2a plus 2b, and line 2e is line 2c divided by line 2d.
Explain voting, stock and reserves
Answer lines 3 and 4 (retiring nonproducer voting stock; voting rights and votes per person), line 5 (legal rate of interest), line 6 (nonvoting preferred stock participation) and lines 7 and 8 (required and other reserves, with names, purposes and amounts).
Describe members, dividends and activities
Answer line 9 (members and nonmembers), lines 10 and 11 (patronage dividends and the obligation behind their allocation), and explain lines 12 to 15: activities, distribution of proceeds, charges for supplies and equipment, and membership requirements.
Complete federated cooperative questions
Lines 16a to 16c apply to federated cooperatives only. If member cooperatives are not all exempt and have different accounting periods, check Method 1, Method 2 or explain another method.
Report business volume on lines 17 to 22
Lines 17 and 18: value of products marketed and supplies and equipment, for the current year and 3 prior years. Lines 19 and 20: business with the U.S. Government; lines 21 and 22: net earnings distribution and whether operations match the information given.
Complete Part IV financial data
For the current year and each of the 3 preceding years, enter the statement of receipts and expenditures (lines 1 to 18) and balance sheets (lines 19 to 39), attaching schedules where the lines say so. Use a more detailed statement if you prefer.
Review, sign and download the PDF
Check that the signer is an officer, director or attorney-in-fact, then sign, give the title or authority, and date. Download or print the completed PDF from FillingPDF and assemble the package with Form 8718 as described under How to submit.
How to submit Form 1028
Form 1028 is sent to the IRS by mail or private delivery service, together with Form 8718 and the user fee. The instructions give no online or in-person channel.
- Mail: The instructions direct you to the address in the Instructions to Form 8718. The update printed at the front of the Form 1028 PDF gives this address for Forms 1023, 1024, 1024-A, 1028, 5300, 5307, 5310, 5310-A, 5316, 8717, 8718 and 8940: Internal Revenue Service, TE/GE Stop 31A Team 105, P.O. Box 12192, Covington, KY 41012–0192.
- Private delivery service: Internal Revenue Service, 7940 Kentucky Drive, TE/GE Stop 31A Team 105, Florence, KY 41042.
Include the completed application, all required information and attachments, and Form 8718, User Fee for Exempt Organization Determination Letter Request. A nonrefundable user fee applies and must accompany the request; otherwise the request is returned without action. The fee amount is shown in Form 8718 and is subject to change: check www.irs.gov (keyword "User Fee") or call Customer Account Services at 1-877-829-5500. If a representative acts for the organization, send the power of attorney with the application. Keep a copy of the completed application for your permanent records. FillingPDF lets you fill out and download the PDF; submission follows the channels above.
Common mistakes to avoid
- Filing Form 1028 for an organization that has no organizing document; the form says not to file in that case.
- Omitting Form 8718 or the user fee, which can lead the IRS to return the application without action.
- Sending original organizing documents; none of the submitted documents are returned, so send conformed copies.
- Sending unsigned copies of the organizing documents without a declaration from an authorized officer certifying they are complete and accurate.
- Entering lump sums in the financial statements; the instructions ask for a detailed breakdown of receipts and expenditures.
- Ending the current-year financial period more than 60 days from the application date, or leaving out one of the 3 preceding years.
- Attaching pages that do not say they relate to Form 1028 or do not identify the part and line number, name, address and EIN.
- Having someone other than an officer, a director or a person with power of attorney sign the application.
- Filing without an EIN or without applying for one; line 1b asks for it, and "Applied for" may be entered if it has not been received by the time the return is due.
- Answering lines 16a to 16c when the association is not a federated cooperative.
Frequently asked questions
What is Form 1028 used for?
Form 1028 is the IRS application for recognition of exempt status under section 521 of the Internal Revenue Code. It is used by farmers', fruit growers' or like associations organized and operated on a cooperative basis that want to be recognized as exempt cooperatives.
Who can sign Form 1028?
An officer, a director, or a person with power of attorney may sign it. If someone with power of attorney signs, submit the power of attorney with the application, using Form 2848 or Form 8821.
Is there a fee to file Form 1028?
Yes. A nonrefundable user fee applies and is submitted with Form 8718 and the application; without it the request is returned without action. The fee changes, so check Form 8718 or www.irs.gov, or call 1-877-829-5500.
Where do I mail Form 1028?
The instructions say to use the address in the Instructions to Form 8718. The update on the Form 1028 PDF lists Internal Revenue Service, TE/GE Stop 31A Team 105, P.O. Box 12192, Covington, KY 41012–0192, and for private delivery services 7940 Kentucky Drive, Florence, KY 41042.
Can I file Form 1028 without organizing documents?
No. The form says that if the organization has no organizing document, do not file the application. Submit a conformed copy of the articles of incorporation or constitution or articles of association, plus the bylaws.
What financial years must I include?
Include the current year and each of the 3 immediately preceding years, or the time the organization has existed if under 4 years. The current period must end within 60 days of the application date; the IRS may ask for more years.
What happens after the IRS receives Form 1028?
The instructions say the IRS will advise you soon after receipt of its determination and of the annual returns the organization must file. A recognized section 521 organization files Form 1120-C each year.
Can I fill out Form 1028 online on FillingPDF?
Yes. You can fill out the fillable PDF online on FillingPDF and download or print it. FillingPDF is an independent service and does not file the application; you send it to the IRS with Form 8718 and the fee through the channels above.
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