IRS Instruction 1045 – IRS Forms, Instructions, Pubs 2026 – If you’re dealing with a net operating loss (NOL), an unused business credit, or certain overpayments, IRS Form 1045 could help you secure a quick tax refund. This form, known as the Application for Tentative Refund, allows eligible taxpayers to carry back losses and credits to prior years for faster relief. In this comprehensive guide, we’ll break down the IRS instructions for Form 1045, including eligibility, filing steps, recent updates for tax year 2025, and tips to avoid common pitfalls. Whether you’re an individual, estate, or trust, understanding how to use this form can streamline your tax strategy.
What Is IRS Form 1045 and Its Purpose?
IRS Form 1045 is specifically designed for individuals, estates, and trusts seeking a tentative (quick) refund based on specific carryback provisions. Unlike standard amended returns, this form accelerates the refund process, typically within 90 days of filing or the due date of your return (including extensions).
The primary purposes include:
- Carryback of a Net Operating Loss (NOL): This allows you to apply an NOL from the current year to reduce taxable income in prior years. For farming or insurance-related NOLs, the carryback period is generally 2 years.
- Carryback of an Unused General Business Credit: If you have excess credits from forms like Form 3800, you can carry them back to offset taxes in earlier years.
- Carryback of a Net Section 1256 Contracts Loss: This applies to losses from regulated futures contracts, treated as an adjustment to adjusted gross income (AGI).
- Overpayment Due to a Claim of Right Adjustment: Under section 1341(b)(1), if you’ve repaid income previously taxed, you may qualify for a refund.
Note that tax-exempt trusts should use Form 990-T instead, and carrybacks to years involving section 965 (repatriation tax) require an amended return like Form 1040-X, not Form 1045.
Who Can File Form 1045? Eligibility Criteria
Form 1045 is available to:
- Individuals
- Estates
- Trusts (excluding tax-exempt ones)
To be eligible, you must have one of the qualifying events listed above, such as an NOL or unused credit arising in the tax year. You cannot use this form for forward carryovers—only carrybacks. Additionally, if your carryback creates an alternative minimum tax (AMT) liability, you’ll need to account for it using Form 6251.
Key eligibility notes:
- For NOLs, refer to Publication 536 (Net Operating Losses) for calculations.
- Farming losses are limited to the smaller of your farming NOL or total NOL, with a 2-year carryback.
- Joint filers must consider special rules if filing statuses change between years.
If you’re unsure about eligibility, consult IRS.gov/Form1045 for the latest guidance.
How to File IRS Form 1045: Step-by-Step Process?
Filing Form 1045 requires careful preparation to ensure quick processing. Here’s how:
When to File?
You must submit Form 1045 within 1 year after the end of the tax year in which the NOL, credit, loss, or adjustment occurred. Extensions may apply for federally declared disasters—check IRS.gov/DisasterTaxRelief. Do not file before submitting your income tax return for the loss year.
Where to File?
- Paper Filing: Mail to the IRS Service Center for your location, as indicated in your income tax return instructions. Do not include it with your regular tax return.
- E-Filing: Use new Form 8453-TR for electronic submission, a 2025 update for efficiency.
What to Attach?
Attach copies of:
- Your tax return (e.g., Form 1040 or 1041) and relevant schedules (A, D, F, J, etc.).
- Form 6251 (AMT) for each carryback year.
- Computations for NOL (from Publication 536), credits (Form 3800), or losses (Form 6781).
- Allocation schedules if filing status changed.
- Form 8302 for refunds of $1 million or more.
- Any election statements or Forms 8886 (reportable transactions).
Incomplete attachments can delay or disallow your application.
Direct Deposit for Refunds
Under Executive Order 14247, the IRS is phasing out paper checks. Provide banking details on Line 34 for direct deposit. See IRS.gov/ModernPayments for more.
Key Line-by-Line Instructions for Form 1045
Follow these summaries from the official instructions:
- Line 1b (Unused General Business Credit): Attach detailed computations; special rules apply for joint vs. separate returns.
- Line 1c (Net Section 1256 Contracts Loss): Reduces AGI; attach Form 6781 and amended Schedule D.
- Line 2c (New for 2025): Check if resubmitting in response to IRS correspondence; attach only requested items.
- Lines 10-32 (Computation of Decrease in Tax): Use columns for before and after carryback. Refigure AGI, deductions, taxes, credits, AMT, and more. Attach worksheets if used.
- Line 33 (Overpayment Under Section 1341(b)(1)): Attach computation per regulations.
For NOL details, use Form 1045’s computation sections and reference Publication 536. No dedicated Schedules A, B, or C exist on Form 1045, but attach relevant ones from your return.
Recent Changes and Updates for Tax Year 2025
As of 2026, the instructions for Form 1045 include several efficiency-focused updates:
- New Resubmission Process: Line 2c simplifies resubmissions.
- E-Filing Enhancements: Form 8453-TR enables electronic filing.
- Payment Modernization: Mandatory direct deposit under EO 14247.
The One Big Beautiful Bill Act (Working Families Tax Cut Act) introduced broader changes like increased Child Tax Credits and standard deductions, but these do not directly alter Form 1045. Always check IRS.gov for post-publication developments.
Common Mistakes and Tips for Success
- Avoid Omissions: Double-check attachments; material errors can lead to disallowance without appeal rights (though you can file Form 1040-X later).
- Refigure Everything: Carrybacks affect AGI, credits, and taxes—use tools like Form 8962 for premium tax credits.
- Authorize Representation: Use Form 2848 if needed.
- Estimated Burden: Filing may take time; refer to OMB estimates in your return instructions.
For complex cases, consult a tax professional. Remember, refunds are tentative and subject to audit.
By following these IRS Form 1045 instructions, you can efficiently claim your tentative refund and optimize your tax position. Stay updated via IRS.gov/Form1045 for any 2026 changes.