- When will I get my tax information?
- Why is my tax information always so late?
- What tax forms are necessary for reporting my tax credits?
- Do I need to mail in my Schedule K-1 to the IRS?
- I have more than one Boston Capital Investment.
- What is the cusip number for this investment?
- Why am I only receiving a small return on my investment the first year?
- How can I use my passive losses?
- What do I do in the case of Alternative Minimum Tax (AMT)?
1. When will I get my tax information?
Tax information for all public funds will be sent out on or before March 15th; information for private partnerships will be sent out on or about March 31st. Your K-1 will be available to download from the website approximately 10 days sooner than the mailed copy. Signup at www.bostoncapital.com to “Go Paperless” and receive and email notification when your account documents are available.
2. Why is my tax information always so late?
Why can't I get it sooner? Public funds include many underlying properties which must each have their own tax return prepared by their local accountant. This information is then submitted to Boston Capital. The Fund's accountants gather this information as it is completed, check to ensure that the expected Tax Credits have been generated, and then prepare your Fund's tax return. Private partnerships are complex, and may include more than one property. Due to the complexity of these investments, their annual tax returns may take longer to prepare.
3. What tax forms are necessary for reporting my tax credits?
You will need to use the following forms to report your low-income housing tax credits: Form 8582 (Passive Activity Loss Limitations); Form 8582-CR (Passive Activity Credit Limitations); Form 3800 (General Business Credit). (Individuals are no longer required to complete and file Form 8586 (Low-Income Housing Credit). The credits are reported directly on Form 3800)
5. I have more than one Boston Capital Investment.
Will I receive more than one K-1? Yes. A separate K-1 will be created for each investment. The K-1s are created and mailed by Series, so you probably will not receive all of your K-1 ’ s on the same day. This also applies to the availability of documents on the website. When filling out your tax forms, you will need to add the figures from each of your K-1s and then you only need to fill out one set of forms.
7. Why am I only receiving a small return on my investment the first year?
In the initial years of the funds, the tax credits are phased in. During phase-in, construction is being completed and initial occupancy is being achieved. Once the properties are completed and occupied, Tax Credits should be generated at the higher yield levels for a consistent period of time.
8. How can I use my passive losses?
Passive losses may be used to offset passive income only. You may use the passive losses from your Boston Capital investment if you have passive income from another passive investment. As a result of the 1986 Tax Reform Act, these passive losses are not usable against earned or portfolio income. To use these losses, you must report them on the Form 8582 and carry that information to Schedule E.
9. What do I do in the case of Alternative Minimum Tax (AMT)?
If you are unable to use your Tax Credits due to AMT, you must first carry the Tax Credits back 1 year and amend your taxes. You must use the Form 1040X to amend your previous years' taxes. If you cannot carry the Tax Credits back, then you may carry them forward for 20 years.
Investors should carefully consider the investment objectives, risks, charges and expenses of our fund before investing. For a prospectus containing this and other information about our fund, contact your financial advisor, call Boston Capital Securities, Inc. at 800-866-2282, or click on the following link to view or download a prospectus (using Adobe Acrobat Reader). Please read the prospectus carefully prior to investing.