Partners in Cooperative Development

The Internal Revenue Service administers the Federal cooperative tax rules, processes Form 1120-C, the U.S. Income Tax Return for Cooperative Associations (review instructions for 1120-C) and provides publications to assist cooperatives with tax planning. IRS employees draft regulations interpreting the Internal Revenue Code and for a fee issue private letter rulings on cooperatives’ tax situations. Agricultural marketing and supply cooperatives that would like to receive special deductions beyond those received by nonexempt cooperatives must meet certain organizational and operational standards and file Form 1028, Application for Recognition of Exemption Under Section 521 of the Internal Revenue Code (review instructions for Form 1028).

The Justice Department has jurisdiction over the Capper Volstead Act, which provides a limited exemption for agricultural cooperatives from antitrust liability. The Capper Volstead Act allows farmers to unite in cooperative associations to collectively market their products.

The Labor Department Employee Benefits Security Administration Participant Assistance and Outreach Program educates participants, beneficiaries and plan sponsors about their rights and obligations under employee benefit laws. EBSA also ensures that participants and beneficiaries have access to plan documents filed with the Labor Department so that they can more easily access their benefits. EBSA national and field offices offer individualized participant assistance. EBSA also provides rulings and opinions on compliance with the Employee Retirement Income Security Act to plan participants and sponsors.

The Labor Department Employment and Training Administration provides workforce information and administers federal government job training and federal grants to states for public employment service programs. These services are primarily provided through state and local workforce development systems. Their Office of Workforce Investment provides workers with job search assistance and training services including work-based learning. OWI programs also help connect employers with skilled workers.

Labor Department's Occupational Safety and Health Administration sets and enforces workplace safety standards and provides training, outreach, education and compliance assistance. Cooperatives must comply with all applicable OSHA standards and keep their workplace free of serious recognized hazards.

The Labor Department Wage and Hour Division enforces federal minimum wage, overtime pay, recordkeeping, and child labor requirements of the Fair Labor Standards Act. WHD provides resources and information to assure workers receive proper pay including compliance assistance toolkits, posters, fact sheets, and presentations.

The Securities and Exchange Commission oversees when a company raises money by selling securities to investors. Many of these securities sales must go through a costly registration process with the SEC, but certain sales are exempt from registration. The SEC Office of the Advocate for Small Business Capital Formation helps small businesses, particularly those in rural areas and in places where natural disasters have occurred as well as businesses that are owned by minorities and women. The Office provides tools, technical assistance, information, education, and outreach so that small businesses and their investors can raise capital.

The Small Business Administration provides technical assistance to cooperatives through its Small Business Development Centers. In some limited instances SBA may provide financial assistance through its 7(a) loan program, microloans, 504 loans, and disaster loans. SBA also provides general technical assistance to businesses. SBA has programs directed toward minority, women, LGBT, veteran, and Native American business owners. Additional SBA partner organizations that cooperatives may benefit from include Veterans Business Outreach Centers, Score Business Mentors, and Women’s Business Centers. SBA provides information to businesses interested in contracting with the Federal government. Through its 8(a) Business Development program, it aims to award at least 5% of all federal contracting dollars to small disadvantaged businesses each year.

The Department of Transportation has opportunities that cooperatives can access, generally by reaching out to an intermediary governmental entity or nonprofit that has been awarded DoT funds. The Thriving Communities Program provides funding to disadvantaged communities adversely affected by environmental, climate, and human health policy outcomes. The Reconnecting Communities Program provides planning grants, capital construction grants, and technical assistance to reconnect communities that were previously cut off from economic opportunities by transportation infrastructure. The Rural Opportunities to Use Transportation for Economic Success program addresses disparities in rural transportation infrastructure. The Rural EV Infrastructure Toolkit helps rural communities plan and fund electric vehicle charging infrastructure.

The Treasury Department’s Financial Institutions Office oversees the Community Development Financial Institutions Fund including the New Market Tax Credit Program. CDFIs are banks, credit unions, loan funds, or venture capital providers that have been certified by Treasury and receive assistance from the CDFI fund to invest in low-income communities and broaden access to financial products and services. Through the NMTC Program, the CDFI Fund allocates authority to certified Community Development Entities to offer tax credits to investors in exchange for equity in the CDE. Using the capital from these equity investments, CDEs make loans and investments to businesses operating in low-income communities on better-then-market terms. Cooperatives may benefit by borrowing from CDFIs or from loans or investments by CDEs.