Form 1028 is the IRS Application for Recognition of Exemption Under Section 521. A farmers' cooperative, meaning an association of farmers, fruit growers or people in similar work that's organized and run on a cooperative basis, uses it to ask the IRS to recognize its exempt status. It goes in with the organizing documents, four years of financial data and the user fee, and an exempt cooperative then files Form 1120-C every year.
This guide follows the September 2006 revision of Form 1028 and its instructions, plus the mailing address update the IRS has added to the front of the form file, as of October 2026. The About Form 1028 page lists no recent developments.
Who Form 1028 is for
Section 521 is a narrow status for agricultural cooperatives, not a general charity exemption. A charity or social welfare group uses Form 1023 or a related form instead. The form itself says it's for the use of farmers', fruit growers' or like associations, and that if your organization doesn't have an organizing document, you shouldn't file it at all.
Recognition matters because the instructions say a cooperative won't be treated as exempt, even if it runs within sections 521 and 1381 to 1388, unless it files this application or already has an IRS ruling recognizing the exemption.
What's on the form
- Part I, identification: the organization's legal name, EIN, address, the date it was formed, the month its accounting year ends and whether it's filed federal returns before.
- Part II, type of entity: a corporation attaches articles of incorporation and bylaws, and any other kind attaches its constitution or articles of association and bylaws.
- Part III, activities: share classes and dividends, how much stock producers own, voting rights, reserves, whether it deals with nonmembers, patronage dividends, membership rules and how it handles proceeds and supplies.
- Part IV, financial data: receipts and expenditures plus balance sheets.
Part III is where most of the judgment sits. It asks what percentage of the voting stock is owned by current and active producers, how a nonproducer's voting stock gets retired, and whether patronage dividends are paid to members and nonmembers on the same basis.
The financial data rule
You give receipts, expenditures and balance sheets for the current year and each of the 3 years before it, or for as long as the organization has existed if that's under 4 years. The current year has to run from the first day of your accounting year to a date within 60 days of the application. If you're applying less than 60 days into the current year, no current year figures are needed, but the 3 preceding years still are.
The instructions also want a detailed breakdown, with no lump sums, and the IRS may ask for more than 4 years of data if circumstances warrant.
Documents to send with it
- A conformed copy of the complete organizing instrument and the bylaws. A conformed copy agrees with the original and every amendment, and unsigned copies need a declaration from an authorized officer that they're complete and accurate.
- The financial statements described above.
- Form 8718 with the user fee. The fee is nonrefundable, and the instructions say an application sent without it will be returned without action. User fees change, so check the current amount on the IRS site before you send anything.
- A power of attorney on Form 2848 if an agent or attorney will represent the cooperative.
None of the documents you send are returned, so keep copies. Every attachment should say it relates to Form 1028, name the part and line it supports, and show the organization's name, address and EIN.
Where to send Form 1028
The current form file carries an update over the old instructions: Form 1028 goes to the Internal Revenue Service, TE/GE Stop 31A Team 105, P.O. Box 12192, Covington, KY 41012. Private delivery services use the Florence, Kentucky address printed in the same update. The IRS says filers should rely on that update until the next revision of the instructions.
After the IRS decides
The IRS tells you its determination and which annual returns you'll have to file. An exempt farmers' cooperative files Form 1120-C, the income tax return for cooperative associations, rather than the ordinary corporate Form 1120.
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Who signs, and who the IRS can call
The application has to be signed by an officer, a director or someone holding a power of attorney for the cooperative, and a power of attorney has to be sent with it. Line 3 of Part I asks for the name and phone number of someone the IRS can reach during normal business hours, which saves weeks if a question comes up.
If the cooperative doesn't have an EIN yet, it has to apply for one first. The instructions say that if the number hasn't arrived by the time the application is due, you enter Applied for in the EIN space rather than leaving it blank.
Checklist before you post it
- Every part of the application completed, with attachments where the space runs out.
- The EIN on line 1b, or Applied for if it's pending.
- Conformed copies of the organizing instrument and the bylaws.
- Financial data for each required year, with no lump sums.
- Form 8718 and the current user fee.
- A signature from an officer, a director or an authorized representative.
The verdict
Form 1028 is short on paper but heavy on evidence. The cooperative has to show it's organized and run for producers, on a cooperative basis, with four years of clean figures behind it. Get the organizing documents conformed, the financial years right and the user fee confirmed before you post it to Covington.
Frequently asked questions
What is Form 1028?
It's the application a farmers' cooperative files to ask the IRS to recognize it as exempt under section 521 of the Internal Revenue Code.
Who can file Form 1028?
An association of farmers, fruit growers or people in similar occupations that's organized and operated on a cooperative basis and has an organizing document.
How many years of financial data does Form 1028 need?
The current year and the 3 years before it, or the time the organization has existed if that's less than 4 years.
Where do I mail Form 1028?
To the Internal Revenue Service, TE/GE Stop 31A Team 105, P.O. Box 12192, Covington, KY 41012, under the mailing address update on the current form file.
What return does an exempt farmers' cooperative file?
Form 1120-C, the U.S. Income Tax Return for Cooperative Associations.
