U.S. Income Tax Return of a Foreign Corporation

Who Must Sign

The return must be signed and dated by:

• The president, vice president, treasurer, assistant treasurer, chief accounting officer or
• Any other corporate officer (such as tax officer) authorized to sign.

Receivers, trustees, or assignees must also sign and date any return filed on behalf of a corporation.

If an employee of the corporation completes Form 1120-F, the paid preparer's space should remain blank. In addition, anyone who prepares Form 1120-F but does not charge the corporation should not complete that section. Generally, anyone who is paid to prepare the return must sign it and fill in the Paid Preparer's Use Only area.

The paid preparer must complete the required preparer information and -

• Sign the return, by hand, in the space provided for the preparer's signature (signature stamps or labels are not acceptable).
• Give a copy of the return to the taxpayer.

Paid Preparer Authorization

If the corporation wants to allow the IRS to discuss its 2001 tax return with the paid preparer who signed it, check the Yes box in the signature area of the return. This authorization applies only to the individual whose signature appears in the Paid Preparer's Use Only section of the corporation's return. It does not apply to the firm, if any, shown in that section.

If the Yes box is checked, the corporation is authorizing the IRS to call the paid preparer to answer any questions that may arise during the processing of its return. The corporation is also authorizing the paid preparer to:

• Give the IRS any information that is missing from the return,
• Call the IRS for information about the processing of the return or the status of any related refund or payment(s), and
• Respond to certain IRS notices that the corporation has shared with the preparer about math errors, offsets, and return preparation. The notices will not be sent to the preparer.

The corporation is not authorizing the paid preparer to receive any refund check, bind the corporation to anything (including any additional tax liability), or otherwise represent the corporation before the IRS. If the corporation wants to expand the paid preparer's authorization, see Pub. 947, Practice Before the IRS and Power of Attorney.

The authorization cannot be revoked. However, the authorization will automatically end no later than the due date (excluding extensions) for filing the corporation's 2002 tax return.

Where To File

File Form 1120-F with the Internal Revenue Service Center, Philadelphia, PA 19255.

Other Forms, Returns, and Statements That May Be Required

Forms

A foreign corporation may have to file some of the following forms. See the forms for more information.

Form W-2, Wage and Tax Statement, and Form W-3, Transmittal of Wage and Tax Statements. Use these forms to report wages, tips, and other compensation, and withheld income, social security, and Medicare taxes for employees.

Form 720, Quarterly Federal Excise Tax Return. Use this form to report and pay the luxury tax on passenger vehicles, environmental taxes, communications and air transportation taxes, fuel taxes, manufacturers taxes, ship passenger taxes, and certain other excise taxes.

Form 940 or Form 940-EZ, Employer's Annual Federal Unemployment (FUTA) Tax Return. The corporation may be liable for FUTA tax and may have to file Form 940 or Form 940-EZ if either of the following applies.

1. It paid wages of $1,500 or more in any calendar quarter in 2000 or 2001 or
2. It had at least one employee who worked for the corporation for some part of a day in 20 or more different weeks in 2000 or 20 or more different weeks in 2001.

Form 941, Employer's Quarterly Federal Tax Return, or Form 943, Employer's Annual Tax Return for Agricultural Employees. Employers must file these forms to report income tax withheld, and employer and employee social security and Medicare taxes. Also, see Trust fund recovery penalty on page 7.

Form 945, Annual Return of Withheld Federal Income Tax. File Form 945 to report income tax withheld from nonpayroll distributions or payments, including pensions, annuities, IRAs, gambling winnings, and backup withholding.

See Trust fund recovery penalty on page 7.

Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons, and Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding. Use these forms to report and send withheld tax on payments or distributions made to nonresident alien individuals, foreign partnerships, or foreign corporations to the extent these payments constitute gross income from sources within the United States (see sections 861 through 865).

Also, see Pub. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities, and sections 1441 and 1442.

Form 1096, Annual Summary and Transmittal of U.S. Information Returns.

Form 1098, Mortgage Interest Statement. Use this form to report the receipt from any individual of $600 or more of mortgage interest (including points) in the course of the corporation's trade or business and reimbursement of overpaid interest.

Forms 1099. Use these information returns to report the following.

• Form 1099-A, Acquisition or Abandonment of Secured Property.
• Form 1099-B, Proceeds From Broker and Barter Exchange Transactions.
• Form 1099-C, Cancellation of Debt.
• Form 1099-DIV, Dividends and Distributions.
• Form 1099-INT, Interest Income.
• Form 1099-LTC, Long-Term Care and Accelerated Death Benefits.
• Form 1099-MISC, Miscellaneous Income. Use this form to report payments: to certain fishing boat crew members, to providers of health and medical services, of rent or royalties, of non-employee compensation, etc.

  Note: Every corporation must file Form 1099-MISC if it makes payments of rents, commissions, or other fixed or determinable income (see section 6041) totaling $600 or more to any one U. S. person in the course of its trade or business during the calendar year.

• Form 1099-MSA, Distributions From an Archer MSA or Medicare+Choice MSA.
• Form 1099-OID, Original Issue Discount.
• Form 1099-PATR, Taxable Distributions Received From Cooperatives.
• Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
• Form 1099-S, Proceeds From Real Estate Transactions.

Also, use these returns to report amounts received as a nominee for another person.

Form 5471, Information Return of U.S. Persons With Respect to Certain Foreign Corporations. This form is filed by certain officers, directors, and U.S. shareholders of certain foreign corporations to report the information required by sections 6035, 6038, and 6046 (and the underlying regulations). See Form 5471 and its instructions.

Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. This form is filed by or for a foreign corporation engaged in a U.S. trade or business that had certain reportable transactions with a related party. See Form 5472 for filing instructions and information for failure to file and maintain records.

Form 5498, IRA Contribution Information. Use this form to report contributions (including rollover contributions) to any IRA, including a SEP, SIMPLE, Roth IRA, Coverdell ESA, and to report Roth conversions, IRA recharacterizations, and the fair market value of the account.

Form 5498-MSA, Archer MSA or Medicare+Choice MSA Information. Use this form to report contributions to an Archer MSA and the fair market value of an Archer MSA or Medicare+Choice MSA.

For more information, see the general and specific Instructions for Forms 1099, 1098, and 5498, and W-2G.

Form 5713, International Boycott Report. If the foreign corporation had operations in or related to certain boycotting countries, the U.S. shareholders, if any, must file Form 5713.

Form 8264, Application for Registration of a Tax Shelter. Tax shelter organizers use this form to receive a tax shelter registration number from the IRS.

Form 8271, Investor Reporting of Tax Shelter Registration Number. Corporations, which have acquired an interest in a tax shelter that is required to be registered, use this form to report the tax shelter's registration number. Attach Form 8271 to any tax return (including an application for tentative refund (Form 1139) and an amended return) on which a deduction, credit, loss, or other tax benefit attributable to a tax shelter is taken or any income attributable to a tax shelter is reported.

Form 8275, Disclosure Statement, and Form 8275-R, Regulation Disclosure Statement. Disclose items or positions taken on a tax return that are not otherwise adequately disclosed on a tax return or that are contrary to Treasury regulations (to avoid parts of the accuracy-related penalty or certain preparer penalties).

Form 8288, U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests, and Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property Interests. Use these forms to report and transmit withheld tax on the purchase of U.S. real property to a foreign person. However, for distributions described in Regulations section 1.1445-8, use Forms 1042 and 1042-S. See section 1445 and the related regulations for additional information.

Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business. Use this form to report the receipt of more than $10,000 in cash or foreign currency in one transaction or a series of related transactions.

Form 8302, Direct Deposit of Tax Refund of $1 Million or More. This form must be filed to request a direct deposit of a tax refund of $1 million or more.

Form 8594, Asset Allocation Statement Under Sections 338 and 1060. Corporations file this form to report the purchase or sale of a group of assets that constitute a trade or business if goodwill or going concern value could attach to the assets and if the buyer's basis is determined only by the amount paid for the assets.

Form 8621, Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund. This form is used by U.S. shareholders to make certain elections by shareholders in a passive foreign investment company and to figure certain deferred taxes.

Form 8697, Interest Computation Under the Look-Back Method for Completed Long-Term Contracts. Use this form to figure the interest due or to be refunded under the look-back method of section 460(b)(2). The look-back method applies to certain long-term contracts accounted for under the percentage of completion method or percentage of completion-capitalized cost method.

Form 8810, Corporate Passive Activity Loss and Credit Limitations. Closely held corporations (and corporations that are personal service corporations) must use this form to figure the passive activity loss and credit allowed under section 469.

Form 8817, Allocation of Patronage and Nonpatronage Income and Deductions. Use this form to figure and report patronage and nonpatronage income and deductions (used by taxable cooperatives).

For 8833, Treaty-Based Return Position Disclosure. Use this form to make the treaty-based return position disclosure required by section 6114.

Form 8842, Election to Use Different Annualization Periods for Corporate Estimated Tax. Corporations use Form 8842 for each year they want to elect one of the annualization periods in section 6655(e)(2) for figuring estimated tax payments under the annualized income installment method.

Form 8848, Consent to Extend the Time To Assess the Branch Profits Tax Under Regulations Sections 1.884-2(a) and (c). A foreign corporation must file Form 8848 if it has completely terminated all of its U.S. trade or business within the meaning of Regulations section 1.884-2T(a) during the tax year.

Form 8849, Claim for Refund of Excise Taxes. Use this form to claim a refund of certain excise taxes.

Form 8866, Interest Computation Under the Look-Back Method for Property Depreciated Under the Income Forecast Method. Figure the interest due or to be refunded under the look-back method of section 167(g)(2) for property placed in service after September 13, 1995, that is depreciated under the income forecast method.

Schedule PH (Form 1120), U.S. Personal Holding Company Tax. See Line 4. Personal Holding Company Tax, on page 8.

Statements

Corporate tax shelters. A corporation is required to disclose its participation in certain tax shelters:

• By attaching a disclosure statement to its income tax return for a reportable transaction for each tax year its income tax liability is affected by its participation in the transaction and
• For the first tax year a disclosure statement is attached to its tax return, by sending a copy of the disclosure statement to the Internal Revenue Service, LM:PFTG:OTSA, Large & Mid-Size Business Division, 1111 Constitution Ave., NW, Washington, DC 20224.

Disclosure is required for reportable transactions that are: (a) listed transactions that the IRS has identified as tax avoidance transactions and (b) other reportable transactions that have tax shelter characteristics. A listed transaction must be reported if it is expected to reduce the taxpayer's income tax liability by more than $1 million in a single tax year or by a total of more than $2 million for any combination of years. For other reportable transactions, the threshold increases to $5 million for a single tax year or to $10 million for any combination of years. Generally, reporting is not required for customary business transactions or transactions with tax benefits that the IRS has no reasonable basis to challenge.

See Temporary Regulations section 1.6011-4T for details, including:

• The definition of a reportable transaction and a listed transaction,
• The relevant tax shelter characteristics for other reportable transactions,
• The form and content of the disclosure statement, and
• The filing requirements of the disclosure statement.

Also, see Notice 2001-51, 2001-34 I.R.B. 190, for certain listed transactions determined to have a tax avoidance purpose and the intended tax benefits that are subject to disallowance. The listed transactions in this notice may be updated from time to time when other tax avoidance transactions are identified.

Transfers to a corporation controlled by the transferor. If a person receives stock of a corporation in exchange for property, and no gain or loss is recognized under section 351, the person (transferor) and the transferee must each attach to their tax returns the information required by Regulations section 1.351-3.

Foreign corporation with no gross income. If the foreign corporation has no gross income for the tax year, do not complete the Form 1120-F schedules. Instead, attach a statement to the return showing the types and amounts of income excluded from gross income.

Assembling the Return

To ensure that the corporation's tax return is correctly processed, attach all schedules and other forms after page 6, Form 1120-F in the following order.

1. Form 8302.
2. Form 4136.
3. Form 4626.
4. Additional schedules in alphabetical order.
5. Additional forms in numerical order.

Complete every applicable entry space on Form 1120-F. Do not write See Attached instead of completing the entry spaces. If more space is needed on the forms or schedules, attach separate sheets, using the same size and format as the printed forms. If there are supporting statements and attachments, arrange them in the same order as the schedules or forms they support and attach them last. Show the totals on the printed forms. Also, be sure to enter the corporation's name and EIN on each supporting statement or attachment.

2001 Instructions Index | 2001 Tax Forms Main | IRS-Forms Main | Home