US Section 962 Tax Election in Lacerte

When making the Section 962 election to be taxed as a domestic corporation under IRC section 962, the following input is required.

To report the tax and generate the statement:

1. Go to Screen 45, Other Taxes
2. Select Schedule J, Recapture, Other Taxes under Taxes in the left panel
3. Locate the Other Taxes section.
4. Using the field Section 962 tax (code 99), enter the new total amount of tax as a positive number.
   • Entering a negative will result in zero tax on line 22.
5. Using the field Section 962 election attachment (MANDATORY for E-file):
   • Code 109: Enter an explanation including a breakdown of your tax calculation to explain the new total amount of tax.

The amount entered in Section 962 tax will flow to Form 1040 line 22, resulting in an adjusted amount on line 16 to accommodate the new tax amount.

The election statement can be viewed on the Elections page and can also be accessed using the link displayed next to line 16.