IRS Instruction 8613 – IRS Forms, Instructions, Pubs 2026 – Regulated Investment Companies (RICs), such as mutual funds and ETFs, must navigate specific IRS requirements to maintain their tax-advantaged status. One key compliance obligation is Form 8613, used to report and pay any excise tax on undistributed income under Internal Revenue Code (IRC) Section 4982. The official IRS Instructions for Form 8613 (Revision December 2025) provide detailed guidance on completing this form.
This article breaks down the purpose of Form 8613, who must file it, how the excise tax works, filing deadlines, and practical tips. It serves as a helpful overview—always consult the latest official IRS instructions and a qualified tax professional for your specific situation.
What Is Form 8613 and Why Does It Matter?
Form 8613, titled Return of Excise Tax on Undistributed Income of Regulated Investment Companies, allows RICs to:
- Calculate the 4% excise tax on any undistributed income for the calendar year.
- Pay the tax if due.
- Make (or revoke) the elective provision under Section 4982(e)(4) for measuring capital gains.
RICs generally avoid corporate-level income tax by distributing substantially all earnings to shareholders. However, Section 4982 imposes a 4% excise tax on the excess (if any) of the required distribution over the distributed amount for the calendar year. This rule encourages timely distributions to shareholders and aligns RIC tax treatment more closely with calendar-year expectations.
Most RICs distribute enough to avoid or minimize this tax, but the form remains important for accurate reporting and elections.
Download the official IRS Instructions for Form 8613 PDF here: https://www.irs.gov/pub/irs-pdf/i8613.pdf (Rev. December 2025).
Download the Form 8613 itself: https://www.irs.gov/pub/irs-pdf/f8613.pdf.
For the latest developments, visit the IRS page: IRS.gov/Form8613.
Who Must File Form 8613?
Any regulated investment company (as defined under IRC Section 851) must file if it is:
- Liable for the excise tax on undistributed income, or
- Making the Section 4982(e)(4) election (even if no tax is due).
Each “fund” (a series fund or a RIC with a single portfolio of assets) files a separate Form 8613.
Exemption: The tax generally does not apply to funds where all shareholders during the calendar year were qualified tax-exempt entities, such as certain trusts or segregated asset accounts of life insurance companies (with limited exceptions for organizational investments up to $250,000). See Section 4982(f) for details.
Understanding the Excise Tax Calculation (Section 4982)
The excise tax equals 4% of the excess (if any) of the required distribution over the distributed amount for the calendar year.
- Required distribution generally includes:
- 98% of the RIC’s ordinary income for the calendar year.
- 98% of capital gain net income for the 1-year period ending October 31 of the calendar year (subject to the election below).
- 100% of any prior-year undistributed amount carried forward in certain cases.
- Distributed amount primarily consists of dividends and other distributions paid during the calendar year that are properly designated as coming from the relevant year’s earnings (with special rules for dividends declared after year-end but paid within a specified period).
The official instructions contain precise definitions, adjustments, and any required worksheets for these computations.
The Section 4982(e)(4) Election
RICs with a taxable year ending in November or December may elect to use their own fiscal year-end (instead of October 31) for measuring capital gain net income. This simplifies calculations by aligning the excise tax measurement period with the RIC’s tax year. The election is made on Form 8613 and generally applies to the year it is made and subsequent years unless revoked.
How to Complete Form 8613: High-Level Steps?
The form is relatively straightforward but requires accurate income and distribution data. Follow the line-by-line instructions in the PDF for details:
- Identify the fund and tax year — Enter the calendar year and fund information.
- Compute ordinary income and capital gain components — Use the required percentages and periods.
- Determine the required distribution and distributed amount.
- Calculate the excess (if any) and apply the 4% tax rate.
- Enter any payments or overpayments, and provide direct deposit information for refunds (newer versions include fields for this).
- Sign and date — An authorized officer (president, treasurer, etc.) must sign.
Rounding: Amounts may be rounded to whole dollars.
Time estimate (per IRS): About 2 hours and 42 minutes to prepare and file.
Electronic payments are encouraged via IRS.gov/Payments. For balances due, follow the instructions for Line 12; for overpayments, use direct deposit on Lines 13b–13d.
Filing Deadlines and Requirements
- Due date: March 15 of the year following the calendar year for which the tax applies (e.g., March 15, 2026, for 2025).
- Extension: File Form 7004 for an automatic 6-month extension of time to file (does not extend time to pay the tax).
- Where to file: Send to the same IRS center where the RIC files its Form 1120-RIC (income tax return). The address depends on the fund’s location and asset size—check the instructions or IRS.gov for the current mailing address.
- Amended returns: File a corrected Form 8613 marked “Amended” at the top.
Interest and penalties apply for late filing or payment, similar to other excise taxes (e.g., 5% per month for late filing up to 25%, plus interest under Section 6621).
Tips for Compliance
- Maintain detailed records of income, gains, and distributions.
- Coordinate with your tax advisor or fund administrator early, especially for the 4982(e)(4) election.
- Use tax software or professional services that handle RIC excise tax calculations.
- Check IRS.gov/Form8613 regularly for updates, as forms and rules can change.
Frequently Asked Questions (FAQs)
- Do all RICs owe the excise tax?
No. Most avoid it through sufficient distributions. The form is still required if making the election or if any tax is due. - Can the tax be avoided entirely?
Yes, by distributing at least the required amount by the applicable deadlines. - Is Form 8613 filed electronically?
Currently, it is generally filed on paper, but check for any e-file options or future changes. - Where can I find the latest version?
Always download directly from IRS.gov. The December 2025 revision is current as of early 2026.
Conclusion
Form 8613 plays a vital role in RIC tax compliance by enforcing timely distributions through the Section 4982 excise tax. Understanding the instructions helps funds stay compliant, minimize taxes, and make informed elections like the 4982(e)(4) provision.
Download the latest IRS Instructions for Form 8613 here: https://www.irs.gov/pub/irs-pdf/i8613.pdf
For personalized advice, consult a tax professional familiar with regulated investment companies. Tax laws and forms are subject to change—verify all information with official IRS sources.
This article is for informational purposes only and does not constitute tax or legal advice.