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@JimS_1 wrote:

Actually...

The instructions for line 3a say..

Does this make sense? Or am I just lost... 😞

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Filing instructions are not authoritative.  And because these are written for general consumption, they tend to miss out important technical details on more complex topics.  That's why you read the Code, Regs, RR, CCM, Preambles, caselaw, JCT reports, etc. instead of only filing instructions and pubs, which are far easier to digest but much lighter in contents.

If you want to go into the technical details and there is a lot even for that one section, read the Code and the Regs under §861 as suggested.  Once you understand those technicalities, all these will start to make sense.