Form 4797N Fillable 2013 Special Capital Gains Election and Computation  (11/2013)
(all forms fillable on Windows, Mac, Android tablets, and iPad using Adobe Reader XI)

(see Page 1 General Instructions) 11c 1 Distributions considered ordinary income or reported on Form W 2 and not on Federal Form 8949 do not qualify 1 Has a previous special capital gains/extraordinary dividend election been made either by or on behalf of the employee? 1 Has been in existence and actively doing business in Nebraska for at least three years; 1 Less than zero; or 1 Sales and exchanges of the qualifying stock in the taxable year the election was made and any following taxable 1 Sales price of the capital stock (attach Federal Form 8949 and Federal Schedule D) 1 1 Through the creation or purchase of a corporation by an investor who is not an employee; 1 What is your relationship to the employee? 10 Enter the amount of the dividend received (attach Federal Schedule B and other federal documentation) 10 2 Cost or other basis in capital stock 2 2 For services performed for a corporation by a non employee; or 2 Greater than Tax Table Income line 14 from Form 1040N without the exclusion 2 Has at least five shareholders; and 2 Is the employee still living? 2 Losses on the qualifying capital stock must be netted against gains on the qualifying capital stock to determine the 2 Name of the corporation issuing the capital stock or declaring the extraordinary dividend 2 Sales and exchanges of stock owned by a spouse or descendant received as a gift including a gift in trust from the 2 Was the capital stock a gift from the employee? (Note inherited stock is not a gift and does not qualify ) 3 Capital gains on sales of capital stock during this year (line 1 minus line 2) 3 3 Has no more than 90% of the capital stock held by any single shareholder or group of related shareholders 3 If you are the qualified spouse were you married to the employee on the date of the sale of the capital stock or the date the dividend 3 Please provide a description of the capital stock sold If claiming extraordinary dividend please provide a detailed description of the 3 Stock that was inherited or transferred through a testamentary trust 3 Was the employee married on the date of the employee s death AND is the spouse still living? 4 Are you the oldest surviving descendant (for example child grandchild)? 4 Capital gains exclusion deferred from a prior year 4 4 Has this corporation conducted business in Nebraska for at least three years before the first sale or exchange of capital stock or 4 If the trust is claiming the exclusion was it created while the employee was living and are all the beneficiaries either the spouse or 5 or More Continue 5 Total capital gains available for exclusion (line 3 from all forms plus line 4) (see Page 1 General Instructions) 5 5 Was the corporation a publicly traded corporation? 6 How many shareholders did the corporation have at the time of the first sale or exchange of capital stock or declaration of extraordinary dividend? 6 Limitation on capital gains exclusion (see instructions) 6 7 Allowable capital gains (smaller of line 5 or line 6) 7 7 Did a shareholder or group of related shareholders hold more than 90% of the capital stock at the time of the first sale or exchange of 8 Capital gains exclusion deferred to next year (line 5 minus line 7) 8 9 Enter the fair market value of the capital stock on the date the dividend was declared 9 as line 3 of Part I Attach this page to Form 1040N or Form 1041N b If result is greater than 20 enter the amount from line 10 on line 11b If the c Total extraordinary dividends available for exclusion (line 11b from all forms) Complete this part to make the Special Capital Gains/Extraordinary Dividend Election declaration of extraordinary dividend? descendant complete the Exclusion Computation on page 1 descendants of the employee? dividend transaction from: to: I hereby elect to receive the special capital gains/extraordinary dividend treatment provided under Neb Rev Stat 77 2715 09 and declare under If the capital stock was not acquired while employed explain how the capital stock was acquired on account of employment If you are not the employee complete only Parts I and II If you are not the employee complete Part III and also Page 1 If you are not the employee complete Parts I II III and also Page 1 If you are the employee complete only Part I If you are the employee complete Page 1 If you are the employee complete Part I and Page 1 Less than 5 STOP The corporation does not qualify for the election Month/Day/Year Month/Day/Year Name of the Employee Who Originally Acquired the Capital Stock Employee s Social Security Number Name of the employee who originally acquired the capital stock if different from the name on Form 1040N Social Security Number Name of the Person Making the Election (if not the employee complete Part II) Social Security Number Name on Form 1040N or Form 1041N Social Security Number NO Continue NO Continue NO STOP The capital stock does not qualify NO STOP The capital stock does not qualify NO STOP The corporation does not qualify for the election NO STOP You do not qualify to make the election NO To exclude income complete the Exclusion Computation on page 1 and sign below Part II Determine if a Non Employee Qualifies to Make the Election Part III Determine if the Capital Stock Qualifies Partial year residents do not include this amount on Form 1040N Nebraska Schedule III line 77 12 Period of time during which the capital stock was acquired by the employee Period of time during which the employee was employed by the corporation Please provide a description of the capital stock sold If you are claiming an extraordinary dividend please provide a detailed description of the dividend transaction result is equal to or less than 20 enter ( 0 ) on line 11b 11b Signature of Employee Surviving Spouse or Descendant Making this Election Date Spouse Descendant (Oldest child or grandchild) Other STOP You do not qualify to make the election Spouse Descendant Trust YES Complete the Exclusion Computation on page 1 YES Continue YES If you are the qualified spouse go to the next question If you represent the trust go to Question 4 If you are a YES If you are the spouse go to Part I to make the election All others STOP Only the spouse can make the election YES Skip to signature YES STOP Only one election is available for an employee (see instructions) YES STOP Only the employee can make the election YES STOP The corporation does not qualify for the election YES You may go to Part I to make the election (If no election has been made previously go to Part I before completing Exclusion Computation ) 11 a Divide line 10 by line 9 11a 12 Allowable exclusion (line 7 plus line 11c) Enter here and on Form 1040N Nebraska Schedule I line 59 8 449 2013 A surviving spouse is a spouse who was married to the employee on the date of the employee's death account of employment adjust the basis for any stock splits also applies to the capital stock of a corporation that was a party to a tax free reorganization with the elected corporation amount is a capital loss enter $3 000 ($1 500 if married filing separately) less the amount of the loss amount to enter on line 3 and once made the election may not be changed The election may be made even if there is no sale or exchange of stock or are inherited or received because of the death of the employee such as a testamentary trust do not qualify for the exclusion been acquired either while the employee was employed by the corporation or on account of employment being excluded qualifies for the income exclusion capital gain add that amount to $3 000 ($1 500 if married filing separately) Enter the result on line 6 of this form If the Capital Gains capital gains exclusion if it is from capital stock from the same employee A separate Page 1 is required for each additional Capital Stock Capital stock is common or preferred stock and may be either voting or nonvoting Capital stock does not capital stock or declaration of extraordinary dividend? Caution The amount on line 6 of this form cannot be: contact the Nebraska Department of Revenue for specific instructions corporation for the employee the spouse or descendants The spouse or descendant must attach a copy of the completed corporation such as a parent or subsidiary Brother sister corporations do not qualify under the same election The election Department if you have a specific question regarding whether a person qualifies as a descendant Descendant Descendant is a direct descendant of the employee (for example child or grandchild) Please contact the Description of the Capital Stock or the Extraordinary Dividend Enter the description of the capital stock (for detailed description of the dividend transaction If this information is the same as what you entered on line 3 of Part I enter dividend election Election and Computation election for the exclusion to apply election the surviving spouse may make the election provided the election could have been made by the employee eligible the dividend must be greater than 20% of the fair market value of the capital stock on the dividend declaration date employed by the corporation employed they must have been acquired on account of employment For the shares to have been acquired on account of employee could have taken the exclusion for the same shares if the employee still owned them To qualify shares owned by employee during his or her lifetime Stock received by a non employee through a will or testamentary trust does Employee Employee is an individual subject to withholding who is or was employed by a qualified corporation and who employee were made during the tax year whether the spouse is also an employee or the capital stock was gifted complete a employment dates attach an explanation of how the capital stock was acquired because of either employment or while employment the employee must have received a vested right to the shares from the corporation while employed An option entry on line 2 unless net sales price was reported on line 1 example sold 100 shares of 7% preferred voting stock ) If you are claiming an extraordinary dividend please enter a Exclusion Computation extraordinary dividend declared during the year Extraordinary Dividend Extraordinary dividend is any dividend that is more than 20% of the fair market value of the Extraordinary Dividends For more information please refer to Neb Rev Stat 77 2715 08 and 77 2715 09 for the income exclusion: FORM 4797N FORM 4797N from the employer that is considered to be compensation that can be exercised without any additional payment would be on General Instructions How to Complete this Form If a broker advised that the gross proceeds (gross sales price) less commission and option premium were reported to the If more than one extraordinary dividend was received complete a separate Page 1 for each dividend Compute the percentage If the Capital Stock Was Not Acquired While Employed If the date the capital stock was acquired is not during If the name of the corporation which issued the stock or declared the extraordinary dividend is different than the corporation If there is no surviving spouse then the oldest living descendant may make the election If you are not the employee and an election has been made go to Part III If you are not the employee and no election has been If you are not the employee use Part II to determine if you qualify to make the election include stock rights stock warrants stock options debt securities or cash distributions from employee stock ownership plans Income from the sale or exchange of capital stock owned by the spouse or descendant will only qualify for the exclusion if the Increase the basis by any expenses of the sale such as broker s fees commissions and option premiums before making an Internal Revenue Service enter the net amount on line 1 Do not include the commission and option premium on line 2 is not the same as the name on the election include an explanation of how the named corporation is a qualified corporation Line 1 Sales Price of the Capital Stock Enter the sales price of the capital stock as shown on the Federal Form 8949 Line 10 Enter the Amount of the Dividend Received Do not include any distribution or the portion of a distribution Line 11 Total Extraordinary Dividends Available for Exclusion For the extraordinary dividend exclusion to be Line 2 All capital stock owned by the spouse or descendants must have been received from the employee by gift Any shares Line 2 Cost or Other Basis in Capital Stock In general the cost or other basis is the cost of the capital stock as LINE 3 Capital Gains on Sales of Capital Stock During this Year Enter the amount of the capital gains on Line 3 The spouse must have been married to the employee at the time of the sale of the capital stock whether or not LINE 4 Capital Gains Exclusion Deferred from a Prior Year Enter the amount of the qualified capital gain on Line 4 Shares held by an inter vivos trust created for the benefit of the spouse or descendants qualify for the exclusion if Line 5 Publicly traded corporations meet the ownership requirements and lines 6 and 7 do not have to be completed line 5 This is the qualified gain that may be carried over and excluded in future years If line 5 is less than line 7 enter ( 0 ) Line 6 If you answered No to question 5 the corporation must have at least five shareholders in order to be a LINE 6 Limitation on Capital Gains Exclusion If line 13 Federal Form 1040 or line 4 Federal Form 1041 is a Line 7 The qualified corporation must have some unrelated shareholders If a group of shareholders who are related to each Line 8 Capital Gains Exclusion Deferred to Next Year If line 5 is greater than line 7 on this form subtract line 7 from made during the tax year combine all sales onto a single Page 1 to determine the exclusion made go to Part II married at the time the return is filed or the date of death of the employee if deceased Multiple Extraordinary Dividends One extraordinary dividend may be included on the same Page 1 as a special Multiple Sales of Capital Stock from One Employee When multiple sales of capital stock from one employee were name appearing on line 2 of Part I attach an explanation as to how the corporations are related and why the gain or dividend Name of Person Making Election If the election is being made on this return enter the phrase See Part I If an election Name of person making the election or who previously made the election if different than above Year the Election Was Made Social Security Number Name of the Corporation Issuing the Capital Stock or Declaring the Extraordinary Dividend Enter the name Name of the corporation issuing the capital stock or declaring the extraordinary dividend If different than the name previously provided on the election explain Name on Form 1040N or Form 1041N Social Security Number niece or nephew of another person who owns capital stock either directly or indirectly Shareholders who are otherwise no extraordinary dividend is received Each spouse may make their own election and it may be for a different corporation Non Qualified Stock Non qualified stock is stock that does not qualify for the exclusion because it was received: not qualify for the exclusion obtained the capital stock either: (1) because of employment by the qualified corporation; or (2) while employed by the of the corporation that issued the capital stock or declared the extraordinary dividend If capital stock issued by more than Once the election is made for an employee that election will apply to sales or exchanges of capital stock of the selected Once the election is made the following transactions by a resident or by a partial year resident while a resident qualify one corporation is included under the same election list the names of all corporations If this information is the same as what Other Corporations The election also applies to the capital stock of other corporations that are related to the elected other hold more than 90% of the shares of the stock the company is too closely held to qualify Page I General Instructions Page I Specific Instructions Part I Part I Election Part I Instructions Part I is only to be completed if an election has never been made for the employee who originally received the stock If a Part II Determine if a Non Employee Qualifies to Make the Election Part II Instructions Part II is only completed when an election has not been previously made and a person other than the employee needs to make Part III Determine if the Capital Stock Qualifies Part III Instructions Part III is only completed when a person other than the employee wants to exclude income from the sale or exchange of Parts II and III penalties of perjury that to the best of my knowledge and belief the capital stock described above qualifies for the special capital gains/extraordinary previous election has been made for the employee that is the only election allowed qualified corporation Qualified Corporation Qualified corporation is any corporation which (at the time of the first sale or exchange of capital qualified person qualifying capital stock or an extraordinary dividend The election applies to sales or exchanges of qualifying capital stock Qualifying Capital Stock To exclude income from the sale or exchange of capital stock of a corporation it is necessary qualifying capital stock transactions this year related stock on the date the dividend is declared retirement purposes or shares the employee acquired on their own in the open market If the shares were not acquired while revenue nebraska gov 800 742 7474 (NE and IA) 402 471 5729 rights to the shares in the trust were not changed by the death of the employee When a trust is claiming the exclusion please Sales of Capital Stock from More than One Employee When multiple sales of capital stock from more than one separate Page 1 for each employee s capital stock The separate Page 1's must be completed through line 3 Then consolidate separately for each dividend and add all of the line 11b amounts on a single line 11c on Page 1 Shareholders are related if one is married to a lineal ancestor or descendent of or is the brother sister aunt uncle cousin Shares acquired while employed can be either shares received from the corporation as compensation shares received for shown on the Federal Form 8949 If cash cost was not used as a basis attach an explanation of your basis Special Capital Gains/Extraordinary Dividend stock or declaration of extraordinary dividend on capital stock for which the election is made): Terms that are inherited or that were transferred as a result of the death of the employee are ineligible for the exclusion that is not treated as a dividend on the federal return such as a return of capital that occurred during or after the time the employee was employed by the elected corporation If the name of the corporation the amounts on lines 4 through 8 on a single Page 1 The Election the election If the employee is alive then only the employee can make the election If the employee died without making the The Exclusion the exclusion would have applied to shares owned directly by the spouse or descendants at the time of the sale; and if the the spouse or descendant must have been received as a gift from the employee while the employee was alive Any shares that This election may be made for the capital stock of one corporation The election may only be made once for an individual to determine if the specific shares that were sold or exchanged qualify for the exclusion The qualifying shares must have To exclude income if an election has previously been made To make an election and exclude income To make an election without excluding any income Total Exclusion transactions in prior years that was carried forward unrelated are related if they are each related to the same person was declared? was previously made attach a copy of the Form 4797N where the initial election was previously made either by you or the when made by the spouse or descendants of the employee When selling capital stock adjust your basis by subtracting all the nontaxable distributions received before the sale Also year; and you entered on line 2 of Part I enter Same as line 2 of Part I