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Form 1120 Instructions

Instructions for Form 1120, U.S. Corporation Income Tax Return

Rev. 2023

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  • Form 1120 - U.S. Corporation Income Tax Return
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Department of the Treasury  
Internal Revenue Service  
2023  
Instructions for Form 1120  
U.S. Corporation Income Tax Return  
Section references are to the Internal Revenue Code unless  
Future Developments  
otherwise noted.  
For the latest information about developments related to Form  
1120 and its instructions, such as legislation enacted after they  
were published, go to IRS.gov/Form1120.  
Contents  
Page  
Future Developments . . . . . . . . . . . . . . . . . . . . . . . . 1  
What’s New . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1  
Photographs of Missing Children . . . . . . . . . . . . . . . . 1  
The Taxpayer Advocate Service . . . . . . . . . . . . . . . . . 2  
Direct Deposit of Refund . . . . . . . . . . . . . . . . . . . . . . 2  
What’s New  
Increase in penalty for failure to file. For tax returns required  
to be filed in 2024, the minimum penalty for failure to file a return  
that is more than 60 days late has increased to the smaller of the  
tax due or $485. See Late filing of return, later.  
How To Make a Contribution To Reduce Debt Held  
by the Public . . . . . . . . . . . . . . . . . . . . . . . . . . . 2  
How To Get Forms and Publications . . . . . . . . . . . . . . 2  
General Instructions . . . . . . . . . . . . . . . . . . . . . . . . . 2  
Purpose of Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2  
Who Must File . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2  
When To File . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3  
Where To File . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4  
Who Must Sign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4  
Paid Preparer Authorization . . . . . . . . . . . . . . . . . . . . 4  
Assembling the Return . . . . . . . . . . . . . . . . . . . . . . . 5  
Tax Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5  
Estimated Tax Payments . . . . . . . . . . . . . . . . . . . . . . 5  
Interest and Penalties . . . . . . . . . . . . . . . . . . . . . . . . 6  
Accounting Methods . . . . . . . . . . . . . . . . . . . . . . . . . 6  
Accounting Period . . . . . . . . . . . . . . . . . . . . . . . . . . 7  
Rounding Off to Whole Dollars . . . . . . . . . . . . . . . . . . 7  
Recordkeeping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7  
Electronically filed returns. The electronic-filing threshold for  
corporate returns required to be filed on or after January 1, 2024,  
has decreased to 10 or more returns. See Electronic Filing, later.  
Deduction for certain energy efficient commercial building  
property. For tax years beginning in 2023, corporations filing  
Form 1120 and claiming the energy efficient commercial  
buildings deduction should report the deduction on line 25. See  
the instructions for line 25.  
Expiration of 100% business meal expense deduction. The  
temporary 100% business meal expenses deduction for food  
and beverages provided by a restaurant does not apply to  
amounts paid or incurred after 2022.  
Corporate alternative minimum tax (CAMT). For tax years  
beginning after 2022, certain corporations must determine  
whether they are subject to the new CAMT and calculate CAMT  
if applicable. See the instructions for Schedule J, line 3. Also,  
Elective payment election. Applicable entities and electing  
taxpayers can elect to treat certain credits as elective payments.  
Resulting overpayment may result in refunds. See the  
instructions for Schedule J, Part II, line 22. Also, see the  
Instructions for Form 3800.  
Other Forms and Statements That May Be  
Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7  
Specific Instructions . . . . . . . . . . . . . . . . . . . . . . . . . 8  
Period Covered . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8  
Name and Address . . . . . . . . . . . . . . . . . . . . . . . . . . 8  
Identifying Information . . . . . . . . . . . . . . . . . . . . . . . . 8  
Employer Identification Number (EIN) . . . . . . . . . . . . . 9  
Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9  
Relief from additions to tax for underpayments applicable  
to the new corporate alternative minimum tax. For tax year  
2023, the IRS will waive the penalty for failure to make estimated  
tax payments for taxes attributable to a CAMT liability. Affected  
corporations must still file the 2023 Form 2220, even if they owe  
no estimated tax penalty. However, affected corporations may  
exclude the CAMT tax liability when calculating the required  
annual payment on Form 2220. Affected corporations must also  
include an amount of estimated tax penalty on line 34 of Form  
1120 (or other appropriate line of the corporation's income tax  
return), even if that amount is zero. Failure to follow these  
instructions could result in affected corporations receiving a  
penalty notice that will require an abatement request to apply the  
relief provided by Notice 2023-42. See Notice 2023-42, 2023-26  
I.R.B. 1085, available at IRS.gov/irb/  
Initial Return, Final Return, Name Change, or  
Address Change . . . . . . . . . . . . . . . . . . . . . . . . . 9  
Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10  
Deductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11  
Schedule C. Dividends, Inclusions, and Special  
Deductions . . . . . . . . . . . . . . . . . . . . . . . . . . . 18  
Schedule J. Tax Computation and Payment . . . . . . . 20  
Schedule K. Other Information . . . . . . . . . . . . . . . . . 22  
Schedule L. Balance Sheets per Books . . . . . . . . . . 26  
2023-26_IRB#NOT-2023-42. Also, see the instructions for  
Schedule M-1. Reconciliation of Income (Loss) per  
Books With Income per Return . . . . . . . . . . . . . 27  
Photographs of  
Missing Children  
Schedule M-2. Analysis of Unappropriated  
Retained Earnings per Books . . . . . . . . . . . . . . 27  
The Internal Revenue Service is a proud partner with the  
Photographs of missing children selected by the Center may  
Principal Business Activity Codes . . . . . . . . . . . . . . 29  
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32  
Jan 17, 2024  
Cat. No. 11455T  
           
appear in instructions on pages that would otherwise be blank.  
You can help bring these children home by looking at the  
photographs and calling 1-800-THE-LOST (1-800-843-5678) if  
you recognize a child.  
Search publications online by topic or keyword;  
View Internal Revenue Bulletins (IRBs) published in recent  
years; and  
Sign up to receive local and national tax news by email.  
Tax forms and publications. The corporation can view, print,  
or download all of the forms and publications it may need on  
IRS.gov/FormsPubs. Otherwise, the corporation can go to  
IRS.gov/OrderForms to place an order and have forms mailed to  
it.  
The Taxpayer Advocate Service  
The Taxpayer Advocate Service (TAS) is an independent  
organization within the IRS that helps taxpayers and protects  
taxpayer rights. TAS's job is to ensure that every taxpayer is  
treated fairly and knows and understands their rights under the  
General Instructions  
As a taxpayer, the corporation has rights that the IRS must  
abide by in its dealings with the corporation. TAS can help the  
corporation if:  
Purpose of Form  
Use Form 1120, U.S. Corporation Income Tax Return, to report  
the income, gains, losses, deductions, credits, and to figure the  
income tax liability of a corporation.  
A problem is causing financial difficulty for the business;  
The business is facing an immediate threat of adverse action;  
or  
The corporation has tried repeatedly to contact the IRS but no  
Who Must File  
one has responded, or the IRS hasn't responded by the date  
promised.  
Unless exempt under section 501, all domestic corporations  
(including corporations in bankruptcy) must file an income tax  
return whether or not they have taxable income. Domestic  
corporations must file Form 1120, unless they are required, or  
elect to file a special return. See Special Returns for Certain  
Organizations, later.  
TAS has offices in every state, the District of Columbia, and  
Puerto Rico. Local advocates' numbers are in their local  
directories and at TaxpayerAdvocate.IRS.gov. The corporation  
can also call TAS at 877-777-4778.  
TAS also works to resolve large-scale or systemic problems  
that affect many taxpayers. If the corporation knows of one of  
these broad issues, please report it to TAS through the Systemic  
Advocacy Management System at IRS.gov/SAMS.  
Entities electing to be taxed as corporations. A domestic  
entity electing to be classified as an association taxable as a  
corporation must file Form 1120, unless it is required to or elects  
to file a special return listed under Special Returns for Certain  
Organizations. The entity must also file Form 8832, Entity  
Classification Election, and attach a copy of Form 8832 to Form  
1120 (or the applicable return) for the year of the election. For  
more information, see Form 8832 and its instructions.  
For more information, go to IRS.gov/Advocate.  
Direct Deposit of Refund  
To request a direct deposit of the corporation's income tax refund  
into an account at a U.S. bank or other financial institution, attach  
Form 8050, Direct Deposit of Corporate Tax Refund. See the  
instructions for line 37.  
Limited liability companies (LLC). If an entity with more than  
one owner was formed as an LLC under state law, it is generally  
treated as a partnership for federal income tax purposes and  
files Form 1065, U.S. Return of Partnership Income. Generally, a  
single-member LLC is disregarded as an entity separate from its  
owner and reports its income and deductions on its owner's  
federal income tax return. The LLC can file a Form 1120 only if it  
has filed Form 8832 to elect to be treated as an association  
taxable as a corporation. For more information about LLCs, see  
Pub. 3402, Taxation of Limited Liability Companies.  
How To Make a Contribution To  
Reduce Debt Held by the Public  
To help reduce debt held by the public, make a check payable to  
“Bureau of the Fiscal Service.Send it to:  
Bureau of the Fiscal Service  
Attn: Dept G  
Corporations engaged in farming. A corporation (other than  
a corporation that is a subchapter T cooperative) that engages in  
farming should use Form 1120 to report the income (loss) from  
such activities. Enter the income and deductions of the  
corporation according to the instructions for lines 1 through 10  
and 12 through 29.  
P.O. Box 2188  
Parkersburg, WV 26106-2188  
Or, enclose the check with the corporation's income tax return. In  
the memo section of the check, make a note that it is a gift to  
reduce the debt held by the public. For information on how to  
make this type of contribution online, go to  
Ownership interest in a Financial Asset Securitization In-  
vestment Trust (FASIT). Special rules apply to a FASIT in  
existence on October 22, 2004, to the extent that regular  
interests issued by the FASIT before October 22, 2004, continue  
to remain outstanding in accordance with their original terms.  
If a corporation holds an ownership interest in a FASIT to  
which these special rules apply, it must report all items of  
income, gain, deductions, losses, and credits on the  
corporation's income tax return (except as provided in section  
860H). Show a breakdown of the items on an attached  
statement. For more information, see sections 860H and 860L  
(repealed with certain exceptions).  
www.treasurydirect.gov and click on “How to Make a  
Contribution to Reduce the Debt.”  
Do not add the contributions to any tax the corporation may  
owe. See the instructions for line 35 for details on how to pay any  
tax the corporation owes. Contributions to reduce debt held by  
the public are deductible subject to the rules and limitations for  
charitable contributions.  
How To Get Forms  
and Publications  
Foreign-owned domestic disregarded entities. If a foreign  
person, including a foreign corporation, wholly owns a domestic  
disregarded entity (DE), the domestic DE is treated as a  
domestic corporation separate from its owner (the foreign  
corporation) for the limited purposes of the requirements under  
Internet. You can access the IRS website 24 hours a day, 7  
days a week, at IRS.gov to:  
Download forms, instructions, and publications;  
Order IRS products online;  
Research your tax questions online;  
2
Instructions for Form 1120  
                       
section 6038A that apply to 25% foreign-owned domestic  
corporations. While a DE is not required to file a U.S. income tax  
return, a DE covered by these rules is required to file a pro forma  
Form 1120 with Form 5472 attached by the due date (including  
extensions) of the return. See the Instructions for Form 5472 for  
additional information and coordination with Form 5472 reporting  
by the domestic DE.  
Regulated investment company  
(section 851)  
1120-RIC  
1120-S  
S corporation (section 1361)  
Settlement fund  
(section 468B)  
1120-SF  
Qualified opportunity fund. To certify as a qualified  
opportunity fund (QOF), the corporation must file Form 1120 and  
attach Form 8996, even if the corporation had no income or  
expenses to report. See Schedule K, Question 25, later. Also,  
see the Instructions for Form 8996.  
Electronic Filing  
Corporations can generally electronically file (e-file) Form 1120,  
related forms, schedules, and attachments; Form 7004  
(automatic extension of time to file); and Forms 940, 941, and  
944 (employment tax returns). If there is a balance due, the  
corporation can authorize an electronic funds withdrawal while  
e-filing. Form 1099 and other information returns can also be  
electronically filed. The option to e-file does not, however, apply  
to certain returns.  
Qualified opportunity investment. If the corporation held a  
qualified investment in a QOF at any time during the year, the  
corporation must file its return with Form 8997 attached. See the  
instructions for Form 8997.  
Special Returns for  
Certain Organizations  
For returns filed on or after January 1, 2024, corporations that  
file 10 or more returns are required to e-file Form 1120. See  
Regulations section 301.6011-5. However, these corporations  
can request a waiver of the electronic filing requirements.  
Instead of filing Form 1120, certain organizations, as shown below, file special  
returns.  
If the organization is a:  
File Form  
For more information on e-filing, see E-file for Business and  
Exempt organization with unrelated  
trade or business income  
Exclusions From Electronic Filing  
990-T  
1065  
Waivers. The IRS may waive the electronic filing rules if the  
corporation demonstrates that a hardship would result if it were  
required to file its return electronically. A corporation interested in  
requesting a waiver of the mandatory electronic filing  
requirement must file a written request, and request one in the  
manner prescribed by the IRS. All written requests for waivers  
should be mailed to:  
Religious or apostolic organization  
exempt under section 501(d)  
Entity formed as a limited liability  
company under state law and treated  
as a partnership for federal income tax  
purposes  
1065  
Internal Revenue Service  
Ogden Submission Processing Center  
Attn: Form 1120 e-file Waiver Request  
Mail Stop 1057  
Subchapter T cooperative association  
(including a farmers' cooperative)  
1120-C  
1066  
Entity that elects to be treated as a real  
estate mortgage investment conduit  
(REMIC) under section 860D  
Ogden, UT 84201  
If using a delivery service, requests for waivers should be mailed  
to:  
Interest charge domestic international  
sales corporation (section 992)  
1120-IC-DISC  
Foreign corporation (other than life or  
property and casualty insurance  
company filing Form 1120-L or Form  
1120-PC)  
Internal Revenue Service  
Ogden Submission Processing Center  
Attn: Form 1120 e-file Waiver Request  
Mail Stop 1057  
1120-F  
1973 N. Rulon White Blvd.  
Ogden, UT 84404  
Foreign sales corporation (section 922)  
1120-FSC  
Condominium management,  
residential real estate management, or  
timeshare association that elects to be  
treated as a homeowners association  
under section 528  
Waiver requests can also be faxed to 877-477-0575. Contact the  
e-Help Desk at 866-255-0654 for questions regarding the waiver  
procedures or process.  
1120-H  
Exemptions. The IRS may provide exemptions from the  
requirements to electronically file. If using the technology  
required to electronically file conflicts with religious beliefs, the  
corporation is exempt from the requirement. Clearly indicate the  
exemption on the corporation’s return. Write "Religious  
Exemption" at the top of Form 1120. File the corporation's return  
at the applicable IRS address. See Where To File, later. For  
more information see Notice 2024-18.  
Life insurance company  
(section 801)  
1120-L  
Fund set up to pay for nuclear  
decommissioning costs (section 468A)  
1120-ND  
Property and casualty insurance  
company  
(section 831)  
1120-PC  
When To File  
Political organization  
(section 527)  
1120-POL  
1120-REIT  
Generally, a corporation must file its income tax return by the  
15th day of the 4th month after the end of its tax year. A new  
corporation filing a short-period return must generally file by the  
15th day of the 4th month after the short period ends. A  
Real estate investment trust (section  
856)  
3
Instructions for Form 1120  
     
Where To File  
File the corporation's return at the applicable IRS address listed below.  
If the corporation's principal business,  
office, or agency is located in:  
And the total assets at the end of  
the tax year are:  
Use the following address:  
Connecticut, Delaware, District of Columbia,  
Georgia, Illinois, Indiana, Kentucky, Maine,  
Maryland, Massachusetts, Michigan, New  
Hampshire, New Jersey, New York, North  
Carolina, Ohio, Pennsylvania, Rhode Island,  
South Carolina, Tennessee, Vermont, Virginia,  
West Virginia, Wisconsin  
Less than $10 million and  
Schedule M-3 is not filed  
Department of the Treasury  
Internal Revenue Service Center  
Kansas City, MO 64999-0012  
$10 million or more, or  
less than $10 million and  
Schedule M-3 is filed  
Department of the Treasury  
Internal Revenue Service Center  
Ogden, UT 84201-0012  
Alabama, Alaska, Arizona, Arkansas, California,  
Colorado, Florida, Hawaii, Idaho, Iowa, Kansas,  
Louisiana, Minnesota, Mississippi, Missouri,  
Montana, Nebraska, Nevada, New Mexico,  
North Dakota, Oklahoma, Oregon, South  
Dakota, Texas, Utah, Washington, Wyoming  
Department of the Treasury  
Internal Revenue Service Center  
Ogden, UT 84201-0012  
Any amount  
A foreign country or U.S. territory  
Internal Revenue Service Center  
P.O. Box 409101  
Ogden, UT 84409  
Any amount  
A group of corporations with members located in more than one service center area will often keep all the books and records at the principal office of  
the managing corporation. In this case, the tax returns of the corporations may be filed with the service center for the area in which the principal  
office of the managing corporation is located.  
corporation that has dissolved must generally file by the 15th day  
of the 4th month after the date it dissolved.  
However, a corporation with a fiscal tax year ending June 30  
must file by the 15th day of the 3rd month after the end of its tax  
year. A corporation with a short tax year ending anytime in June  
will be treated as if the short year ended on June 30, and must  
file by the 15th day of the 3rd month after the end of its tax year.  
the corporate officer. Returns and forms signed by a receiver or  
trustee in bankruptcy on behalf of a corporation must be  
accompanied by a copy of the order or instructions of the court  
authorizing signing of the return or form.  
Paid Preparer Use Only section. If an employee of the  
corporation completes Form 1120, the paid preparer section  
should remain blank. Anyone who prepares Form 1120 but does  
not charge the corporation should not complete that section.  
Generally, anyone who is paid to prepare the return must sign  
and complete the section.  
If the due date falls on a Saturday, Sunday, or legal holiday,  
the corporation can file on the next business day.  
Private Delivery Services  
The paid preparer must complete the required preparer  
information and:  
Corporations can use certain private delivery services (PDS)  
designated by the IRS to meet the “timely mailing as timely filing”  
rule for tax returns. Go to IRS.gov/PDS.  
Sign the return in the space provided for the preparer's  
signature,  
Include their Preparer Tax Identification Number (PTIN), and  
The PDS can tell you how to get written proof of the mailing  
Give a copy of the return to the taxpayer.  
date.  
A paid preparer may sign original or amended returns by  
For the IRS mailing address to use if you’re using a PDS, go  
rubber stamp, mechanical device, or computer software  
program.  
TIP  
Private delivery services can't deliver items to P.O.  
boxes. You must use the U.S. Postal Service to mail any  
!
Paid Preparer Authorization  
CAUTION  
item to an IRS P.O. box address.  
If the corporation wants to allow the IRS to discuss its 2023 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  
Use Only” section of the return. It does not apply to the firm, if  
any, shown in that section.  
Extension of Time To File  
File Form 7004, Application for Automatic Extension of Time To  
File Certain Business Income Tax, Information, and Other  
Returns, to request an extension of time to file. Generally, the  
corporation must file Form 7004 by the regular due date of the  
return. See the Instructions for Form 7004.  
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:  
Who Must Sign  
The return must be signed and dated by:  
Give the IRS any information that is missing from the return;  
Call the IRS for information about the processing of the return  
The president, vice president, treasurer, assistant treasurer,  
chief accounting officer; or  
Any other corporate officer (such as tax officer) authorized to  
or the status of any related refund or payment(s); and  
Respond to certain IRS notices about math errors, offsets,  
sign.  
and return preparation.  
If a return is filed on behalf of a corporation by a receiver,  
trustee, or assignee, the fiduciary must sign the return, instead of  
4
Instructions for Form 1120  
           
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.  
and corporate income tax). Generally, electronic funds transfers  
are made using the Electronic Federal Tax Payment System  
(EFTPS). However, if the corporation does not want to use  
EFTPS, it can arrange for its tax professional, financial  
institution, payroll service, or other trusted third party to make  
deposits on its behalf. Also, it may arrange for its financial  
institution to submit a same-day payment (discussed below) on  
its behalf. EFTPS is a free service provided by the Department of  
the Treasury. Services provided by a tax professional, financial  
institution, payroll service, or other third party may have a fee.  
The authorization will automatically end no later than the due  
date (excluding extensions) for filing the corporation's 2024 tax  
return. If the corporation wants to expand the paid preparer's  
authorization or revoke the authorization before it ends, see Pub.  
947, Practice Before the IRS and Power of Attorney.  
Assembling the Return  
To get more information about EFTPS or to enroll in EFTPS,  
visit EFTPS.gov or call 800-555-4477. To contact EFTPS using  
the Telecommunications Relay Services (TRS), for people who  
are deaf, hard of hearing, or have a speech disability, dial 711  
and provide the TRS assistant the 800-555-4477 number above  
or 800-733-4829.  
To ensure that the corporation's tax return is correctly processed,  
attach all schedules and other forms after page 6 of Form 1120  
in the following order.  
1. Schedule N (Form 1120).  
2. Schedule D (Form 1120).  
3. Form 4797.  
4. Form 8949.  
5. Form 8996.  
Depositing on time. For any deposit made by EFTPS to be on  
time, the corporation must submit the deposit by 8 p.m. Eastern  
time the day before the date the deposit is due. If the corporation  
uses a third party to make deposits on its behalf, they may have  
different cutoff times.  
6. Form 4626.  
Same-day wire payment option. If the corporation fails to  
submit a deposit transaction on EFTPS by 8 p.m. Eastern time  
the day before the date a deposit is due, it can still make its  
deposit on time by using the Federal Tax Collection Service  
(FTCS). To use the same-day wire payment method, the  
corporation will need to make arrangements with its financial  
institution ahead of time regarding availability, deadlines, and  
costs. Financial institutions may charge a fee for payments made  
this way. To learn more about the information the corporation will  
need to provide to its financial institution to make a same-day  
wire payment, go to IRS.gov/SameDayWire.  
7. Form 8050.  
8. Form 1125-A.  
9. Form 4136.  
10. Form 8978.  
11. Form 965-B.  
12. Form 8941.  
13. Form 3800.  
14. Form 8997.  
15. Form 6252.  
16. Form 8936, Schedule A.  
17. Additional schedules in alphabetical order.  
18. Additional forms in numerical order.  
19. Supporting statements and attachments.  
Estimated Tax Payments  
Generally, the following rules apply to the corporation's  
payments of estimated tax.  
The corporation must make installment payments of  
estimated tax if it expects its total tax for the year (less applicable  
credits) to be $500 or more.  
Complete every applicable entry space on Form 1120. Do not  
enter “See Attached” or “Available Upon Request” 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.  
The installments are due by the 15th day of the 4th, 6th, 9th,  
and 12th months of the tax year. If any date falls on a Saturday,  
Sunday, or legal holiday, the installment is due on the next  
regular business day.  
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. Enter  
the corporation's name and EIN on each supporting statement or  
attachment.  
The corporation must use electronic funds transfer to make  
installment payments of estimated tax.  
If, after the corporation figures and deposits estimated tax, it  
finds that its tax liability for the year will be more or less than  
originally estimated, it may have to refigure its required  
installments. If earlier installments were underpaid, the  
corporation may owe a penalty. See Estimated tax penalty  
below.  
Note. If the corporation had tax withheld under Chapter 3 or 4 of  
the Internal Revenue Code and received a Form 1042-S, Form  
8805, or Form 8288-A showing the amount of income tax  
withheld, attach such form(s) to the corporation’s income tax  
return to claim a withholding credit. The corporation should  
report the tax withheld on Schedule J, Part II, line 20z. See the  
instructions for Schedule J, Part II, Line 20z.  
If the corporation overpaid estimated tax, it may be able to get  
a quick refund by filing Form 4466, Corporation Application for  
Quick Refund of Overpayment of Estimated Tax. See the  
instructions for Schedule J, Part II, line 15.  
See section 6655 and Pub. 542, Corporations, for more  
information on how to figure estimated taxes.  
Tax Payments  
Generally, the corporation must pay any tax due in full no later  
than the due date for filing its tax return (not including  
Estimated tax penalty. A corporation that does not make  
estimated tax payments when due may be subject to an  
underpayment penalty for the period of underpayment.  
Generally, a corporation is subject to the penalty if its tax liability  
is $500 or more and it did not timely pay at least the smaller of:  
extensions). See the instructions for line 35. If the due date falls  
on a Saturday, Sunday, or legal holiday, the payment is due on  
the next day that isn't a Saturday, Sunday, or legal holiday.  
Its tax liability for the current year, or  
Its prior year's tax.  
Electronic Deposit Requirement  
Corporations must use electronic funds transfer to make all  
federal tax deposits (such as deposits of employment, excise,  
5
Instructions for Form 1120  
         
Use Form 2220, Underpayment of Estimated Tax by  
Corporations, to see if the corporation owes a penalty and to  
figure the amount of the penalty. If Form 2220 is completed,  
enter the penalty on line 34. See the instructions for line 34. Also  
cases, the method used must clearly show taxable income.  
Permissible methods include cash, accrual, or any other method  
authorized by the Internal Revenue Code.  
Generally, the following rules apply. For more information, see  
Pub. 538, Accounting Periods and Methods.  
A corporation, or a partnership that has a corporation as a  
partner, cannot use the cash method of accounting unless it is a  
small business taxpayer (defined later). A tax shelter (defined in  
section 448(d)(3)) may never use the cash method. See sections  
448(a)(1) through (a)(3). However, see Nonaccrual experience  
method for service providers in the instructions for line 1a.  
Interest and Penalties  
If the corporation receives a notice about penalties after  
it files its return, send the IRS an explanation and we will  
!
CAUTION  
determine if the corporation meets reasonable-cause  
criteria. Do not attach an explanation when the corporation's  
Unless it is a small business taxpayer (defined below), a  
return is filed.  
corporation must use an accrual method for sales and  
purchases of inventory items. See the instructions for Form  
1125-A.  
Interest. Interest is charged on taxes paid late even if an  
extension of time to file is granted. Interest is also charged on  
penalties imposed for failure to file, negligence, fraud, substantial  
valuation misstatements, substantial understatements of tax,  
and reportable transaction understatements from the due date  
(including extensions) to the date of payment. The interest  
charge is figured at a rate determined under section 6621.  
A corporation engaged in farming must use an accrual  
method. For exceptions, see section 447 and Pub. 225.  
Special rules apply to long-term contracts. See section 460.  
Dealers in securities must use the mark-to-market accounting  
method. Dealers in commodities and traders in securities and  
commodities can elect to use the mark-to-market accounting  
method. See section 475.  
Late filing of return. A corporation that does not file its tax  
return by the due date, including extensions, may be penalized  
5% of the unpaid tax for each month or part of a month the return  
is late, up to a maximum of 25% of the unpaid tax. The minimum  
penalty for a tax return required to be filed in 2024 that is more  
than 60 days late is the smaller of the tax due or $485. The  
penalty will not be imposed if the corporation can show that the  
failure to file on time was due to reasonable cause. See Caution,  
earlier.  
Small business taxpayer. For tax years beginning in 2023, a  
corporation qualifies as a small business taxpayer if (a) it has  
average annual gross receipts of $29 million or less for the 3  
prior tax years, and (b) it is not a tax shelter (as defined in  
section 448(d)(3)).  
A small business taxpayer can account for inventory by (a)  
treating the inventory as non-incidental materials and supplies,  
or (b) conforming to its treatment of inventory in an applicable  
financial statement (as defined in section 451(b)(3)). If it does  
not have an applicable financial statement, it can use the method  
of accounting used in its books and records prepared according  
to its accounting procedures.  
Late payment of tax. A corporation that does not pay the tax  
when due may generally be penalized 1/2 of 1% of the unpaid tax  
for each month or part of a month the tax is not paid, up to a  
maximum of 25% of the unpaid tax. See Caution, earlier.  
Change in accounting method. Generally, the corporation  
must get IRS consent to change either an overall method of  
accounting or the accounting treatment of any material item for  
income tax purposes. To obtain consent, the corporation must  
generally file Form 3115, Application for Change in Accounting  
Method, during the tax year for which the change is requested.  
See the Instructions for Form 3115 and Pub. 538 for more  
information and exceptions. Also see the Instructions for Form  
3115 for procedures that may apply for obtaining automatic  
consent to change certain methods of accounting,  
Trust fund recovery penalty. This penalty may apply if certain  
excise, income, social security, and Medicare taxes that must be  
collected or withheld are not collected or withheld, or these taxes  
are not paid. These taxes are generally reported on:  
Form 720, Quarterly Federal Excise Tax Return;  
Form 941, Employer's QUARTERLY Federal Tax Return;  
Form 943, Employer's Annual Federal Tax Return for  
Agricultural Employees;  
Form 944, Employer's ANNUAL Federal Tax Return; or  
Form 945, Annual Return of Withheld Federal Income Tax.  
non-automatic change procedures, and reduced Form 3115  
filing requirements.  
The trust fund recovery penalty may be imposed on all  
persons who are determined by the IRS to have been  
Section 481(a) adjustment. If the corporation's taxable  
income for the current tax year is figured under a method of  
accounting different from the method used in the preceding tax  
year, the corporation may have to make an adjustment under  
section 481(a) to prevent amounts of income or expense from  
being duplicated or omitted. The section 481(a) adjustment  
period is generally 1 year for a net negative adjustment and 4  
years for a net positive adjustment. For an eligible terminated S  
corporation, the section 481(a) adjustment period is generally 6  
years for a negative or positive adjustment that is attributable to  
the S corporation's revocation of its election under section  
1362(a) after December 21, 2017, and before December 22,  
2019. See section 481(d). Also, see the Instructions for Form  
3115.  
Exceptions to the general section 481(a) adjustment period  
may apply. Also, in some cases, a corporation can elect to  
modify the section 481(a) adjustment period. The corporation  
may have to complete the appropriate lines of Form 3115 to  
make an election. See the Instructions for Form 3115 for more  
information and exceptions.  
responsible for collecting, accounting for, or paying over these  
taxes, and who acted willfully in not doing so. The penalty is  
equal to the full amount of the unpaid trust fund tax. See the  
Instructions for Form 720, Pub. 15 (Circular E), Employer's Tax  
Guide, or Pub. 51 (Circular A), Agricultural Employer's Tax  
Guide, for details, including the definition of responsible persons.  
Note. The trust fund recovery penalty will not apply to any  
amount of trust fund taxes an employer holds back in anticipation  
of the credit for qualified sick and family leave wages or the  
employee retention credit that they are entitled to. See Pub. 15 or  
Pub. 51 for more information.  
Other penalties. Other penalties can be imposed for  
negligence, substantial understatement of tax, reportable  
transaction understatements, and fraud. See sections 6662,  
6662A, and 6663.  
Accounting Methods  
Figure taxable income using the method of accounting regularly  
used in keeping the corporation's books and records. In all  
6
Instructions for Form 1120  
             
If the net section 481(a) adjustment is positive, report the  
ratable portion on Form 1120, line 10, as other income. If the net  
section 481(a) adjustment is negative, report the ratable portion  
on line 26 as a deduction.  
2. Any transaction offered under conditions of confidentiality  
for which the corporation (or a related party) paid an advisor a  
fee of at least $250,000.  
3. Certain transactions for which the corporation (or a  
related party) has contractual protection against disallowance of  
the tax benefits.  
4. Certain transactions resulting in a loss of at least $10  
million in any single year or $20 million in any combination of  
years.  
Accounting Period  
A corporation must figure its taxable income on the basis of a tax  
year. A tax year is the annual accounting period a corporation  
uses to keep its records and report its income and expenses.  
Generally, corporations can use a calendar year or a fiscal year.  
Personal service corporations, however, must use a calendar  
year unless they meet one of the exceptions discussed later  
5. Any transaction identified by the IRS by notice, regulation,  
or other published guidance as a “transaction of interest.”  
For more information, see Regulations section 1.6011-4.  
Also, see the Instructions for Form 8886.  
Change of tax year. Generally, a corporation, including a  
personal service corporation, must get the consent of the IRS  
before changing its tax year by filing Form 1128, Application To  
Adopt, Change, or Retain a Tax Year. However, exceptions may  
apply. See the Instructions for Form 1128 and Pub. 538 for more  
information.  
Penalties. The corporation may have to pay a penalty if it is  
required to disclose a reportable transaction under section 6011  
and fails to properly complete and file Form 8886. Penalties may  
also apply under section 6707A if the corporation fails to file  
Form 8886 with its corporate return, fails to provide a copy of  
Form 8886 to the Office of Tax Shelter Analysis (OTSA), or files a  
form that fails to include all the information required (or includes  
incorrect information). Other penalties, such as an  
Rounding Off to  
Whole Dollars  
accuracy-related penalty under section 6662A, may also apply.  
See the Instructions for Form 8886 for details on these and other  
penalties.  
The corporation may enter decimal points and cents when  
completing its return. However, the corporation should round off  
cents to whole dollars on its return, forms, and schedules to  
make completing its return easier. The corporation must either  
round off all amounts on its return to whole dollars, or use cents  
for all amounts. To round, drop amounts under 50 cents and  
increase amounts from 50 to 99 cents to the next dollar. For  
example, $8.40 rounds to $8 and $8.50 rounds to $9.  
Reportable transactions by material advisors. Material  
advisors to any reportable transaction must disclose certain  
information about the reportable transaction by filing Form 8918  
with the IRS. For details, see the Instructions for Form 8918.  
Transfers to a corporation controlled by the transferor.  
Every significant transferor (as defined in Regulations section  
1.351-3(d)(1)) that receives stock of a corporation in exchange  
for property in a nonrecognition event must include the  
statement required by Regulations section 1.351-3(a) on or with  
the transferor's tax return for the tax year of the exchange. The  
transferee corporation must include the statement required by  
Regulations section 1.351-3(b) on or with its return for the tax  
year of the exchange, unless all the required information is  
included in any statement(s) provided by a significant transferor  
that is attached to the same return for the same section 351  
exchange. If the transferor or transferee corporation is a  
controlled foreign corporation (CFC), each U.S. shareholder  
(within the meaning of section 951(b)) must include the required  
statement on or with its return.  
If two or more amounts must be added to figure the amount to  
enter on a line, include cents when adding the amounts and  
round off only the total.  
Recordkeeping  
Keep the corporation's records for as long as they may be  
needed for the administration of any provision of the Internal  
Revenue Code. Usually, records that support an item of income,  
deduction, or credit on the return must be kept for 3 years from  
the date the return is due or filed, whichever is later. Keep  
records that verify the corporation's basis in property for as long  
as they are needed to figure the basis of the original or  
replacement property.  
The corporation should keep copies of all filed returns. They  
help in preparing future and amended returns and in the  
calculation of earnings and profits.  
Distributions under section 355. Every corporation that  
makes a distribution of stock or securities of a controlled  
corporation, as described in section 355 (or so much of section  
356 as it relates to section 355), must include the statement  
required by Regulations section 1.355-5(a) on or with its return  
for the year of the distribution. A significant distributee (as  
defined in Regulations section 1.355-5(c)) that receives stock or  
securities of a controlled corporation must include the statement  
required by Regulations section 1.355-5(b) on or with its return  
for the year of receipt. If the distributing or distributee corporation  
is a CFC, each U.S. shareholder (within the meaning of section  
951(b)) must include the statement on or with its return.  
Other Forms and Statements That  
May Be Required  
Amended return. Use Form 1120-X, Amended U.S.  
Corporation Income Tax Return, to correct a previously filed  
Form 1120.  
Reportable transaction disclosure statement. Disclose  
information for each reportable transaction in which the  
corporation participated. Form 8886, Reportable Transaction  
Disclosure Statement, must be filed for each tax year that the  
federal income tax liability of the corporation is affected by its  
participation in the transaction. The following are reportable  
transactions.  
1. Any listed transaction, which is a transaction that is the  
same as or substantially similar to one of the types of  
transactions that the IRS has determined to be a tax avoidance  
transaction and identified by notice, regulation, or other  
published guidance as a listed transaction.  
Dual consolidated losses. If a domestic corporation incurs a  
dual consolidated loss (as defined in Regulations section  
1.1503(d)-1(b)(5)), the corporation (or consolidated group) may  
need to attach a domestic use agreement and/or an annual  
certification, as provided in Regulations section 1.1503(d)-6(d)  
and (g).  
Election to reduce basis under section 362(e)(2)(C). If  
property is transferred to a corporation subject to section 362(e)  
(2), the transferor and the transferee corporation may elect,  
under section 362(e)(2)(C), to reduce the transferor's basis in  
the stock received instead of reducing the transferee  
7
Instructions for Form 1120  
           
corporation's basis in the property transferred. Once made, the  
election is irrevocable. For more information, see section 362(e)  
(2) and Regulations section 1.362-4. If an election is made, a  
statement must be filed in accordance with Regulations section  
1.362-4(d)(3).  
file in addition to the forms and statements discussed throughout  
these instructions.  
Specific Instructions  
Annual information reporting by specified domestic enti-  
ties under section 6038D. Certain domestic corporations that  
are formed or availed of to hold specified foreign financial assets  
(“specified domestic entities”) must file Form 8938. Form 8938  
must be filed each year the value of the corporation's specified  
foreign financial assets is more than $50,000 on the last day of  
the tax year or more than $75,000 at any time during the tax  
year. For more information on domestic corporations that are  
specified domestic entities and the types of foreign financial  
assets that must be reported, see the Instructions for Form 8938,  
generally, and in particular, Who Must File, Specified Domestic  
Entity, Specified Foreign Financial Assets, Interests in Specified  
Foreign Financial Assets, Assets Not Required To Be Reported,  
and Exceptions to Reporting.  
Period Covered  
File the 2023 return for calendar year 2023 and fiscal years that  
begin in 2023 and end in 2024. For a fiscal or short tax year  
return, fill in the tax year space at the top of the form.  
The 2023 Form 1120 can also be used if:  
The corporation has a tax year of less than 12 months that  
begins and ends in 2024, and  
The 2024 Form 1120 is not available at the time the  
corporation is required to file its return.  
The corporation must show its 2024 tax year on the 2023 Form  
1120 and take into account any tax law changes that are  
effective for tax years beginning after December 31, 2023.  
Name and Address  
In addition, a domestic corporation required to file Form 8938  
with its Form 1120 for the tax year should check “Yes” to  
Schedule N (Form 1120), Question 8, and also include that  
schedule with its Form 1120.  
Enter the corporation's true name (as set forth in the charter or  
other legal document creating it), address, and EIN on the  
appropriate lines. Enter the address of the corporation's principal  
office or place of business. Include the suite, room, or other unit  
number after the street address. If the post office does not  
deliver mail to the street address and the corporation has a P.O.  
box, show the box number instead.  
Form 8975. Certain U.S. persons that are the ultimate parent  
entity of a U.S. multinational enterprise group with annual  
revenue for the preceding reporting period of $850 million or  
more are required to file Form 8975, Country-by-Country Report.  
Form 8975 and Schedule A (Form 8975) must be filed with the  
income tax return of the ultimate parent entity of a U.S.  
Note. Do not use the address of the registered agent for the  
state in which the corporation is incorporated. For example, if a  
business is incorporated in Delaware or Nevada and the  
corporation's principal office is located in Little Rock, Arkansas,  
the corporation should enter the Little Rock address.  
multinational enterprise group for the tax year in or within which  
the reporting period covered by Form 8975 ends. For more  
information, see Form 8975, Schedule A (Form 8975) and the  
Instructions for Form 8975, and Schedule A (Form 8975).  
If the corporation receives its mail in care of a third party  
(such as an accountant or an attorney), enter on the street  
address line “C/O” followed by the third party's name and street  
address or P.O. box.  
Paycheck Protection Program (PPP) loans. A corporation  
that had tax-exempt income resulting from the forgiveness of a  
PPP loan should attach a statement to its return reporting each  
tax year for which the corporation is applying Rev. Proc.  
2021-48, sections 3.01(1), (2), or (3). Any statement for the  
current tax year should include the following information, for  
each PPP loan:  
If the corporation has a foreign address, include the city or  
town, state or province, country, and foreign postal code. Do not  
abbreviate the country name. Follow the country's practice for  
entering the name of the state or province and postal code.  
1. The corporation's name, address, and EIN;  
2. A statement that the corporation is applying or applied  
section 3.01(1), (2), or (3) of Rev. Proc. 2021-48, and for what  
tax year, as applicable;  
3. The amount of tax-exempt income from forgiveness of the  
PPP loan that the corporation is treating as received or accrued  
and for which tax year; and  
Item A. Identifying Information  
Consolidated Return  
Corporations filing a consolidated return must check Item A,  
box 1a, and attach Form 851, Affiliations Schedule, and other  
supporting statements to the return. Also, for the first year a  
subsidiary corporation is being included in a consolidated return,  
attach Form 1122 to the parent's consolidated return. Attach a  
separate Form 1122 for each new subsidiary being included in  
the consolidated return.  
4. Whether forgiveness of the PPP loan has been granted as  
of the date the return is filed.  
A corporation that reported tax-exempt income from the  
forgiveness of a PPP loan on its 2020 return, the timing of which  
corresponds to one of the options presented in Rev. Proc.  
2021-48, need not file an amended return solely to attach the  
statement that is described in these instructions.  
If a corporation treats tax-exempt income resulting from a  
PPP loan as received or accrued prior to when forgiveness of the  
PPP loan is granted and the amount of forgiveness granted is  
less than the amount of tax-exempt income that was previously  
treated as received or accrued, the corporation should make a  
prior-period adjustment on Schedule M-2 for the tax year in  
which the corporation receives notice that the PPP loan was not  
fully forgiven. See the instructions for Schedule M-2 for more  
details.  
File supporting statements for each corporation included in  
the consolidated return. Do not use Form 1120 as a supporting  
statement. On the supporting statement, use columns to show  
the following, both before and after adjustments.  
1. Items of gross income and deductions.  
2. A computation of taxable income.  
3. Balance sheets, as of the beginning and end of the tax  
year.  
4. A reconciliation of income per books with income per  
return.  
5. A reconciliation of retained earnings.  
Other forms and statements. See Pub. 542, Corporations, for  
Enter on Form 1120 the totals for each item of income, gain,  
loss, expense, or deduction, net of eliminating entries for  
a list of other forms and statements a corporation may need to  
8
Instructions for Form 1120  
           
intercompany transactions between corporations within the  
consolidated group. Attach consolidated balance sheets and a  
reconciliation of consolidated retained earnings.  
the tax year, or (b) are not required to file Schedule M-3 (Form  
1120) and voluntarily file Schedule M-3 (Form 1120), must either  
(i) complete Schedule M-3 (Form 1120) entirely, or (ii) complete  
Schedule M-3 (Form 1120) through Part I, and complete Form  
1120, Schedule M-1, instead of completing Parts II and III of  
Schedule M-3 (Form 1120). If the corporation chooses to  
complete Schedule M-1 instead of completing Parts II and III of  
Schedule M-3, the amount on Schedule M-1, line 1, must equal  
the amount on Schedule M-3, Part I, line 11. See the Instructions  
for Schedule M-3 (Form 1120) for more details. Also, see the  
instructions for Schedule M-1, later.  
The corporation does not have to provide the information  
requested in (3), (4), and (5), above, if its total receipts  
(line 1a plus lines 4 through 10 on page 1 of the return)  
TIP  
and its total assets at the end of the tax year (Schedule L,  
line 15(d)) are less than $250,000. See Schedule K, Question  
13.  
For more information on consolidated returns, see the  
regulations under section 1502.  
If you are filing Schedule M-3, check Item A, box 4, to indicate  
that Schedule M-3 is attached.  
Life-Nonlife Consolidated Return  
Item B. Employer Identification  
Number (EIN)  
If Item A, box 1a, is checked and the corporation is the common  
parent of a consolidated group that includes a life insurance  
company, also check box 1b. See Regulations section  
1.1502-47(m) for the requirements for filing a consolidated tax  
return for a life-nonlife consolidated group.  
Enter the corporation's EIN. If the corporation does not have an  
EIN, it must apply for one. An EIN can be applied for:  
Online—Go to IRS.gov/EIN. The EIN is issued immediately  
once the application information is validated.  
By faxing or mailing Form SS-4, Application for Employer  
Personal Holding Company  
A personal holding company must check Item A, box 2, and  
attach Schedule PH (Form 1120), U.S. Personal Holding  
Company (PHC) Tax. See the Instructions for Schedule PH  
(Form 1120) for details.  
Identification Number.  
Corporations located in the United States or U.S.  
territories can use the online application. Foreign  
corporations should call 267-941-1099 (not a toll free  
!
CAUTION  
number) for more information on obtaining an EIN. See the  
Instructions for Form SS-4.  
Personal Service Corporation  
If the corporation is a personal service corporation, check Item  
A, box 3. A personal service corporation is a corporation whose  
principal activity for the testing period is the performance of  
personal services. The testing period for a tax year is generally  
the prior tax year unless the corporation has just been formed.  
Personal services include any activity performed in the fields of  
accounting, actuarial science, architecture, consulting,  
EIN applied for, but not received. If the corporation has not  
received its EIN by the time the return is due, enter “Applied For”  
and the date the corporation applied in the space for the EIN.  
However, if the corporation is filing its return electronically, an  
EIN is required at the time the return is filed. An exception  
applies to subsidiaries of corporations whose returns are filed  
with the parent's electronically filed consolidated Form 1120.  
These subsidiaries should enter “Applied For” in the space for  
the EIN on their returns. The subsidiaries' returns are identified  
under the parent corporation's EIN.  
engineering, health, law, and the performing arts. The services  
must be substantially performed by employee-owners.  
A personal service corporation must use a calendar tax year  
unless:  
It elects to use a 52-53-week tax year that ends with reference  
For more information, see the Instructions for Form SS-4.  
to the calendar year or tax year elected under section 444;  
It can establish a business purpose for a different tax year and  
Item D. Total Assets  
obtains the approval of the IRS (see the Instructions for Form  
1128 and Pub. 538); or  
Enter the corporation's total assets (as determined by the  
accounting method regularly used in keeping the corporation's  
books and records) at the end of the tax year. If there are no  
assets at the end of the tax year, enter -0-.  
It elects under section 444 to have a tax year other than a  
calendar year. To make the election, use Form 8716, Election To  
Have a Tax Year Other Than a Required Tax Year.  
If the corporation is required to complete Schedule L, enter  
the total assets from Schedule L, line 15, column (d), on page 1,  
Item D. If filing a consolidated return, report total consolidated  
assets for all corporations joining in the return.  
If a corporation makes the section 444 election, its deduction  
for certain amounts paid to employee-owners may be limited.  
See Schedule H (Form 1120), Section 280H Limitations for a  
Personal Service Corporation (PSC), to figure the maximum  
deduction.  
Item E. Initial Return, Final Return,  
Name Change, or Address Change  
If a section 444 election is terminated and the termination  
results in a short tax year, type or print at the top of the first page  
of Form 1120 for the short tax year “SECTION 444 ELECTION  
TERMINATED.”  
If this is the corporation's first return, check the “Initial return”  
box.  
If this is the corporation's final return and it will no longer exist,  
Schedule M-3 (Form 1120)  
check the “Final return” box.  
If the corporation changed its name since it last filed a return,  
A corporation with total assets (nonconsolidated or consolidated  
for all corporations included within a consolidated tax group) of  
$10 million or more on the last day of the tax year must file  
Schedule M-3 (Form 1120) instead of Schedule M-1. A  
corporation filing Form 1120 that is not required to file  
Schedule M-3 may voluntarily file Schedule M-3 instead of  
Schedule M-1.  
check the “Name change” box. Generally, a corporation must  
also have amended its articles of incorporation and filed the  
amendment with the state in which it was incorporated.  
If the corporation has changed its address since it last filed a  
return (including a change to an “in care of” address), check the  
“Address change” box.  
Corporations that (a) are required to file Schedule M-3 (Form  
1120) and have less than $50 million total assets at the end of  
Note. If a change in address or responsible party occurs after  
the return is filed, use Form 8822-B, Change of Address or  
9
Instructions for Form 1120  
           
Responsible Party— Business, to notify the IRS. See the  
instructions for Form 8822-B for details.  
The services are in the fields of health, law, engineering,  
architecture, accounting, actuarial science, performing arts, or  
consulting; or  
The corporation meets the section 448(c) gross receipts test  
Income  
for all prior years.  
Except as otherwise provided in the Internal Revenue Code,  
gross income includes all income from whatever source derived.  
This provision does not apply to any amount if interest is  
required to be paid on the amount or if there is any penalty for  
failure to timely pay the amount. See Regulations section  
1.448-3 for more information on the nonaccrual experience  
method, including information on safe harbor methods.  
For information on a book safe harbor method of accounting  
for corporations that use the nonaccrual experience method of  
accounting, see Rev. Proc. 2011-46, 2011-42 I.R.B. 518  
available at IRS.gov/irb/2011-42_IRB#RP-2011-46, or any  
successor. Also, see the Instructions for Form 3115 for  
procedures to obtain automatic consent to change to this  
method or make certain changes within this method.  
Corporations that qualify to use the nonaccrual experience  
method should attach a statement to its return showing total  
gross receipts, the amount not accrued because of the  
application of section 448(d)(5), and the net amount accrued.  
Enter the net amount on line 1a.  
Exception for income from qualifying shipping activities.  
Gross income does not include income from qualifying shipping  
activities if the corporation makes an election under section 1354  
to be taxed on its notional shipping income (as defined in section  
1353) at the highest corporate tax rate. If the election is made,  
the corporation generally may not claim any loss, deduction, or  
credit with respect to qualifying shipping activities. A corporation  
making this election may also elect to defer gain on the  
disposition of a qualifying vessel.  
Use Form 8902, Alternative Tax on Qualifying Shipping  
Activities, to figure the tax. Include the alternative tax on  
Schedule J, Part I, line 9e.  
Line 1. Gross Receipts or Sales  
Line 1a. Gross receipts or sales. Enter on line 1a gross  
receipts or sales from all business operations, except for  
amounts that must be reported on lines 4 through 10.  
Special rules apply to certain income, as discussed below.  
Advance payments. In general, advance payments must be  
included in income in the year of receipt. For exceptions to this  
general rule for corporations that use the accrual method of  
accounting, see the following.  
Line 1b. Returns and allowances. Enter cash and credit  
refunds the corporation made to customers for returned  
merchandise, rebates, and other allowances made on gross  
receipts or sales.  
Line 2. Cost of Goods Sold  
Complete and attach Form 1125-A, Cost of Goods Sold, if  
applicable. Enter on Form 1120, line 2, the amount from Form  
1125-A, line 8. See Form 1125-A and its instructions.  
To report income from long-term contracts, see section 460.  
For rules that allow a limited deferral of advance payments  
beyond the current tax year, see section 451(c). Also, see  
Regulations sections 1.451-8(c), (d), and (e). For applicability  
dates, see Regulations section 1.451-8(h).  
Line 4. Dividends and Inclusions  
See the instructions for Schedule C, later. Complete Schedule C  
For information on adopting or changing to a permissible  
and enter on line 4 the amount from Schedule C, line 23, column  
(a).  
method for reporting advance payments for services and certain  
goods by an accrual method corporation, see the Instructions for  
Form 3115.  
Line 5. Interest  
Installment sales. Generally, the installment method cannot  
be used for dealer dispositions of property. A dealer disposition”  
is any disposition of (a) personal property by a person who  
regularly sells or otherwise disposes of personal property of the  
same type on the installment plan, or (b) real property held for  
sale to customers in the ordinary course of the taxpayer's trade  
or business.  
Enter taxable interest on U.S. obligations and on loans, notes,  
mortgages, bonds, bank deposits, corporate bonds, tax refunds,  
etc. Do not offset interest expense against interest income.  
Special rules apply to interest income from certain  
below-market-rate loans. See section 7872 for details.  
Note. Report tax-exempt interest on Schedule K, item 9. Also, if  
required, include the same amount on Schedule M-1, line 7, or  
Schedule M-3 (Form 1120), Part II, line 13, if applicable.  
The restrictions on using the installment method do not apply  
to the following.  
Dispositions of property used or produced in the trade or  
business of farming.  
Line 6. Gross Rents  
Certain dispositions of timeshares and residential lots  
Enter the gross amount received for the rental of property.  
Deduct expenses such as repairs, interest, taxes, and  
depreciation on the proper lines for deductions. A rental activity  
held by a closely held corporation or a personal service  
corporation may be subject to the passive activity loss rules. See  
reported under the installment method for which the corporation  
elects to pay interest under section 453(I)(3).  
Enter on line 1a (and carry to line 3) the gross profit on  
collections from these installment sales. Attach a statement  
showing the following information for the current and the 3  
preceding years: (a) gross sales, (b) cost of goods sold, (c)  
gross profits, (d) percentage of gross profits to gross sales, (e)  
amount collected, and (f) gross profit on the amount collected.  
For sales of timeshares and residential lots reported under  
the installment method, if the corporation elects to pay interest  
under section 453(I)(3), the corporation's income tax is  
increased by the interest payable under section 453(l)(3). Report  
this addition to the tax on Schedule J, Part I, line 9g.  
Line 10. Other Income  
Enter any other taxable income not reported on lines 1 through  
9. List the type and amount of income on an attached statement.  
If the corporation has only one item of other income, describe it  
in parentheses on line 10.  
Examples of other income to report on line 10 include the  
following.  
Nonaccrual experience method for service providers.  
Accrual method corporations are not required to accrue certain  
amounts to be received from the performance of services that,  
based on their experience, will not be collected, if:  
Recoveries of bad debts deducted in prior years under the  
specific charge-off method.  
Any amount includible in income from Form 6478, Biofuel  
Producer Credit.  
10  
Instructions for Form 1120  
                   
Any amount includible in income from Form 8864, Biodiesel,  
qualified leave wages were paid, which might, under certain  
circumstances, not occur until a quarter after September 30,  
2021, including quarters in 2023.  
Renewable Diesel, or Sustainable Aviation Fuels Credit.  
Refunds of taxes deducted in prior years to the extent they  
reduced the amount of tax imposed. See section 111 and the  
related regulations. Do not offset current-year taxes against tax  
refunds.  
Deductions  
Limitations on Deductions  
Uniform capitalization rules. The uniform capitalization rules  
of section 263A require corporations to capitalize certain costs to  
inventory or other property. Corporations subject to the section  
263A uniform capitalization rules are required to capitalize:  
Ordinary income from trade or business activities of a  
partnership (from Schedule K-1 (Form 1065)). Do not offset  
ordinary losses against ordinary income. Instead, include the  
losses on line 26. Show the partnership's name, address, and  
EIN on a separate statement attached to this return. If the  
amount entered is from more than one partnership, identify the  
amount from each partnership.  
1. Direct costs of assets produced or acquired for resale,  
The transferred loss amount identified as “Section 91  
and  
Transferred Loss Amount,which is required to be recognized  
when substantially all the assets of a foreign branch are  
transferred to a specified 10% owned foreign corporation (as  
defined in section 245A(b)) with respect to which the corporation  
was a U.S. shareholder immediately after the transfer. See  
section 91.  
2. Certain indirect costs (including taxes) that are properly  
allocable to property produced or property acquired for resale.  
The corporation cannot deduct the costs required to be  
capitalized under section 263A until it sells, uses, or otherwise  
disposes of the property (to which the costs relate). The  
corporation recovers these costs through depreciation,  
amortization, or cost of goods sold.  
Any LIFO recapture amount under section 1363(d). The  
corporation may have to include a LIFO recapture amount in  
income if it:  
A small business taxpayer (defined earlier) is not required to  
capitalize costs under section 263A. A small business taxpayer  
that wants to discontinue capitalizing costs under section 263A  
must change its method of accounting. See section 263A(i) and  
Regulations section 1.263A-1(j). Also, see the Instructions for  
Form 3115.  
1. Used the LIFO inventory method for its last tax year  
before the first tax year for which it elected to become an S  
corporation, or  
2. Transferred LIFO inventory assets to an S corporation in a  
nonrecognition transaction in which those assets were  
transferred basis property.  
For more information on the uniform capitalization rules, see  
Pub. 538. Also, see Regulations sections 1.263A-1 through  
1.263A-3. See section 263A(d), Regulations section 1.263A-4,  
and Pub. 225 for rules for property produced in a farming  
business.  
The LIFO recapture amount is the amount by which the C  
corporation's inventory under the FIFO method exceeds the  
inventory amount under the LIFO method at the close of the  
corporation's last tax year as a C corporation (or for the year of  
the transfer, if (2) above applies). Also, see the instructions for  
Transactions between related taxpayers. Generally, an  
accrual basis taxpayer can only deduct business expenses and  
interest owed to a related party in the year the payment is  
included in the income of the related party. See sections 163(e)  
(3) and 267(a)(2) for limitations on deductions for unpaid interest  
and expenses.  
The ratable portion of any net positive section 481(a)  
adjustment. See Section 481(a) adjustment, earlier.  
Part or all of the proceeds received from certain  
corporate-owned life insurance contracts issued after August 17,  
2006. Corporations that own one or more employer-owned life  
insurance contracts issued after this date must file Form 8925,  
Report of Employer-Owned Life Insurance Contracts. See Form  
8925.  
Limitations on business interest expense. Business interest  
expense may be limited. See section 163(j) and Form 8990.  
Also, see Limitation on deduction in the instructions for line 18  
and Schedule K, Question 23 and Question 24, later.  
Income from cancellation of debt (COD) from the repurchase  
of a debt instrument for less than its adjusted issue price.  
The corporation's share of the following income from Form  
Section 291 limitations. Corporations may be required to  
adjust deductions for depletion of iron ore and coal, intangible  
drilling and exploration and development costs, certain  
deductions for financial institutions, and the amortizable basis of  
pollution control facilities. See section 291 to determine the  
amount of the adjustment.  
8621, Information Return by a Shareholder of a Passive Foreign  
Investment Company or Qualified Electing Fund.  
1. Ordinary earnings of a qualified electing fund.  
2. Gain or loss from marking passive foreign investment  
company (PFIC) stock to market.  
Election to deduct business start-up and organizational  
costs. A corporation can elect to deduct a limited amount of  
start-up and organizational costs it paid or incurred. Any  
remaining costs must generally be amortized over a 180-month  
period. See sections 195 and 248 and the related regulations.  
Time for making an election. The corporation generally  
elects to deduct start-up or organizational costs by claiming the  
deduction on its income tax return filed by the due date  
(including extensions) for the tax year in which the active trade or  
business begins. For more details, see the Instructions for Form  
4562.  
3. Gain or loss from sale or other disposition of section 1296  
stock.  
4. Excess distributions from a section 1291 fund allocated to  
the current year and pre-PFIC years, if any.  
See Form 8621 and the Instructions for Form 8621 for details.  
Any payroll tax credit taken by an employer on its 2023  
employment tax returns (Forms 941, 943, and 944) for qualified  
paid sick and qualified paid family leave under FFCRA and ARP  
(both the nonrefundable and refundable portions). The  
corporation must include the full amount of the credit for qualified  
sick and family leave wages in gross income for the tax year that  
includes the last day of any calendar quarter in which the credit  
is allowed.  
If the corporation timely filed its return for the year without  
making an election, it can still make an election by filing an  
amended return within 6 months of the due date of the return  
(excluding extensions). Clearly indicate the election on the  
amended return and enter “Filed pursuant to section  
Note. A credit is available only if the leave was taken after  
March 31, 2020, and before October 1, 2021, and only after the  
301.9100-2” at the top of the amended return. File the amended  
11  
Instructions for Form 1120  
           
return at the same address the corporation filed its original  
return. The election applies when figuring taxable income for the  
current tax year and all subsequent years.  
The corporation can choose to forgo the elections above by  
affirmatively electing to capitalize its start-up or organizational  
costs on its income tax return filed by the due date (including  
extensions) for the tax year in which the active trade or business  
begins.  
If the corporation has any of the credits listed above, figure  
the current-year credit before figuring the deduction for expenses  
on which the credit is based. If the corporation capitalized any  
costs on which it figured the credit, it may need to reduce the  
amount capitalized by the credit attributable to these costs.  
See the instructions for the form used to figure the applicable  
credit for more details.  
Limitations on deductions related to property leased to  
tax-exempt entities. If a corporation leases property to a  
governmental or other tax-exempt entity, the corporation cannot  
claim deductions related to the property to the extent that they  
exceed the corporation's income from the lease payments. This  
disallowed tax-exempt use loss can be carried over to the next  
tax year and treated as a deduction with respect to the property  
for that tax year. See section 470(d) for exceptions.  
Note. The election to either amortize or capitalize start-up costs  
is irrevocable and applies to all start-up costs that are related to  
the trade or business.  
Report the deductible amount of start-up and organizational  
costs and any amortization on line 26. For amortization that  
begins during the current tax year, complete and attach Form  
4562, Depreciation and Amortization.  
Limitation on tax benefits for remuneration under the Pa-  
tient Protection and Affordable Care Act. The $1 million  
compensation limit is reduced to $500,000 for remuneration for  
services provided by individuals for or on behalf of certain health  
insurance providers. The $500,000 limitation applies to  
remuneration that is deductible in the tax year during which the  
services were performed and remuneration for services during  
the year that is deductible in a future tax year (called "deferred  
deduction remuneration"). The $500,000 limitation is reduced by  
any amounts disallowed as excess parachute payments. See  
section 162(m)(6) and Regulations section 1.162-31 for  
definitions and other special rules.  
Passive activity limitations. Limitations on passive activity  
losses and credits under section 469 apply to personal service  
corporations (defined earlier) and closely held corporations  
(defined later).  
Generally, the two kinds of passive activities are:  
Trade or business activities in which the corporation did not  
materially participate for the tax year; and  
Rental activities, regardless of its participation.  
For exceptions, see Form 8810, Corporate Passive Activity Loss  
and Credit Limitations.  
Corporations subject to the passive activity limitations must  
complete Form 8810 to compute their allowable passive activity  
loss and credit. Before completing Form 8810, see Temporary  
Regulations section 1.163-8T, which provides rules for allocating  
interest expense among activities. If a passive activity is also  
subject to the at-risk rules of section 465 or the tax-exempt use  
loss rules of section 470, those rules apply before the passive  
loss rules.  
For more information, see section 469, the related  
regulations, and Pub. 925, Passive Activity and At-Risk Rules.  
Closely held corporations. A corporation is a closely held  
corporation if:  
Line 12. Compensation of Officers  
Enter deductible officers' compensation on line 12. Do not  
include compensation deductible elsewhere on the return, such  
as amounts included in cost of goods sold, elective contributions  
to a section 401(k) cash or deferred arrangement, or amounts  
contributed under a salary reduction SEP agreement or a  
SIMPLE IRA plan.  
If the corporation's total receipts (line 1a, plus lines 4 through  
10) are $500,000 or more, complete Form 1125-E,  
Compensation of Officers. Enter on Form 1120, line 12, the  
amount from Form 1125-E, line 4.  
At any time during the last half of the tax year more than 50%  
in value of its outstanding stock is directly or indirectly owned by  
or for not more than five individuals, and  
Line 13. Salaries and Wages  
The corporation is not a personal service corporation.  
Enter the total salaries and wages paid for the tax year. Do not  
include salaries and wages deductible elsewhere on the return,  
such as amounts included in officers' compensation, cost of  
goods sold, elective contributions to a section 401(k) cash or  
deferred arrangement, or amounts contributed under a salary  
reduction SEP agreement or a SIMPLE IRA plan.  
Certain organizations are treated as individuals for purposes  
of this test. See section 542(a)(2). For rules for determining  
stock ownership, see section 544 (as modified by section 465(a)  
(3)).  
Reducing certain expenses for which credits are allowable.  
If the corporation claims certain credits, it may need to reduce  
the otherwise allowable deductions for expenses used to figure  
the credit. This applies to credits such as the following.  
If the corporation provided taxable fringe benefits to its  
employees, such as personal use of a car, do not deduct as  
wages the amount allocated for depreciation and other expenses  
claimed on lines 20 and 26.  
Work opportunity credit (Form 5884).  
Credit for increasing research activities (Form 6765).  
Orphan drug credit (Form 8820).  
If the corporation claims a credit for any wages paid or  
incurred, it may need to reduce any corresponding  
!
Disabled access credit (Form 8826).  
CAUTION  
deduction for officers' compensation and salaries and  
Empowerment zone employment credit (Form 8844).  
Credit for employer social security and Medicare taxes paid  
allowable, earlier.  
on certain employee tips (Form 8846).  
Credit for small employer pension plan start-up costs (Form  
8881).  
Line 14. Repairs and Maintenance  
Credit for employer-provided childcare facilities and services  
Enter the cost of repairs and maintenance not claimed  
elsewhere on the return, such as labor and supplies, that are not  
payments to produce or improve real or tangible personal  
property. See Regulations section 1.263(a)-1. For example,  
amounts are paid for improvements if they are for betterments to  
the property, restorations of the property (such as the  
(Form 8882).  
Low sulfur diesel fuel production credit (Form 8896).  
Credit for employer differential wage payments (Form 8932).  
Credit for small employer health insurance premiums (Form  
8941).  
Employer credit for paid family and medical leave (Form  
replacements of major components or substantial structural  
parts), or if they adapt the property to a new or different use.  
8994).  
12  
Instructions for Form 1120  
           
Amounts paid to produce or improve property must be  
capitalized. See Regulations sections 1.263(a)-2 and (a)-3.  
property (these taxes must be treated as a part of the cost of the  
acquired property or, in the case of a disposition, as a reduction  
in the amount realized on the disposition).  
The corporation can deduct repair and maintenance  
expenses only to the extent they relate to a trade or business  
activity. See Regulations section 1.162-4. The corporation may  
elect to capitalize certain repair and maintenance costs  
consistent with its books and records. See Regulations section  
1.263(a)-3(n) for information on how to make the election.  
Taxes assessed against local benefits that increase the value  
of the property assessed (such as for paving, etc.).  
Taxes deducted elsewhere on the return, such as those  
reflected in cost of goods sold.  
See section 164(d) for information on apportionment of taxes  
on real property between seller and purchaser.  
Line 15. Bad Debts  
Do not reduce the corporation's deduction for social  
Enter the total debts that became worthless in whole or in part  
during the tax year. A small bank or thrift institution using the  
reserve method of section 585 should attach a statement  
showing how it figured the current year's provision. A corporation  
that uses the cash method of accounting cannot claim a bad  
debt deduction unless the amount was previously included in  
income.  
security and Medicare taxes by the nonrefundable and  
!
CAUTION  
refundable portions of any FFCRA and ARP credits for  
qualified sick and family leave wages claimed on its employment  
tax returns. Instead, report this amount as income on line 10.  
Line 18. Interest  
Note. Do not offset interest income against interest expense.  
The corporation must make an interest allocation if the  
proceeds of a loan were used for more than one purpose (for  
example, to purchase a portfolio investment and to acquire an  
interest in a passive activity). See Temporary Regulations  
section 1.163-8T for the interest allocation rules.  
Line 16. Rents  
If the corporation rented or leased a vehicle, enter the total  
annual rent or lease expense paid or incurred during the year.  
Also, complete Part V of Form 4562. If the corporation leased a  
vehicle for a term of 30 days or more, the deduction for vehicle  
lease expense may have to be reduced by an amount includible  
in income called the inclusion amount. The corporation may  
have an inclusion amount if:  
Mutual savings banks, building and loan associations, and  
cooperative banks can deduct the amounts paid or credited to  
the accounts of depositors as dividends, interest, or earnings.  
See section 591.  
And the vehicle's FMV on  
the first day of the lease  
Do not deduct the following interest.  
The lease term began:  
exceeded:  
Interest on indebtedness incurred or continued to purchase or  
carry obligations if the interest is wholly exempt from income tax.  
See section 265(b) for special rules and exceptions for financial  
institutions. Also, see section 265(b)(7) for a de minimis  
exception for financial institutions for certain tax-exempt bonds  
issued in 2009 and 2010.  
Cars (excluding trucks and vans)  
After 12/31/22 but before 1/1/24  
After 12/31/21 but before 1/1/23  
After 12/31/20 but before 1/1/22  
After 12/31/17 but before 1/1/21  
After 12/31/12 but before 1/1/18  
Trucks and vans  
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$60,000  
$56,000  
$51,000  
$50,000  
$19,000  
For cash basis taxpayers, prepaid interest allocable to years  
following the current tax year. For example, a cash basis  
calendar year taxpayer who in 2023 prepaid interest allocable to  
any period after 2023 can deduct only the amount allocable to  
2023.  
After 12/31/22 but before 1/1/24  
After 12/31/21 but before 1/1/23  
After 12/31/20 but before 1/1/22  
After 12/31/17 but before 1/1/21  
After 12/31/13 but before 1/1/18  
After 12/31/09 but before 1/1/14  
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$60,000  
$56,000  
$51,000  
$50,000  
$19,500  
$19,000  
Interest and carrying charges on straddles. Generally, these  
amounts must be capitalized. See section 263(g).  
Interest on debt allocable to the production of designated  
property by a corporation for its own use or for sale. The  
corporation must capitalize this interest. Also, capitalize any  
interest on debt allocable to an asset used to produce the  
property. See section 263A(f) and Regulations sections  
1.263A-8 through 1.263A-15 for definitions and more  
information.  
Interest paid or incurred on any portion of an underpayment of  
tax that is attributable to an understatement arising from an  
undisclosed listed transaction or an undisclosed reportable  
avoidance transaction (other than a listed transaction) entered  
into in tax years beginning after October 22, 2004.  
See Pub. 463, Travel, Gift, and Car Expenses, for instructions  
on figuring the inclusion amount.  
Special rules apply to:  
Forgone interest on certain below-market-rate loans (see  
Note. The inclusion amount for lease terms beginning in 2024  
section 7872).  
Original issue discount (OID) on certain high yield discount  
will be published in the Internal Revenue Bulletin in early 2024.  
obligations. See section 163(e)(5) to determine the amount of  
the deduction for OID that is deferred and the amount that is  
disallowed on a high yield discount obligation. The rules under  
section 163(e)(5) do not apply to certain high yield discount  
obligations issued after August 31, 2008, and before January 1,  
2011. See section 163(e)(5)(F).  
Line 17. Taxes and Licenses  
Enter taxes paid or accrued during the tax year, but do not  
include the following.  
Federal income taxes.  
Foreign or U.S. territory income taxes if a foreign tax credit is  
claimed.  
Interest which is allocable to unborrowed policy cash values of  
Taxes not imposed on the corporation.  
life insurance, endowment, or annuity contracts issued after  
June 8, 1997. See section 264(f). Attach a statement showing  
the computation of the deduction.  
Taxes, including state or local sales taxes, that are paid or  
incurred in connection with an acquisition or disposition of  
13  
Instructions for Form 1120  
       
“100%” for “10%” ) over all other allowable charitable  
contributions. Any excess qualified conservation contributions  
can be carried over to the next 15 years, subject to the 100%  
limitation. See sections 170(b)(2)(B) and (C).  
Limitation on deduction. Under section 163(j), business  
interest expense is generally limited to the sum of business  
interest income, 30% of the adjusted taxable income, and floor  
plan financing interest. The amount of any business interest  
expense that is not allowed as a deduction for the tax year is  
carried forward to the following year. If section 163(j) applies, use  
Form 8990 to figure the amount of business interest expense the  
corporation can deduct for the current tax year and the amount  
that can be carried forward to the next year. See the Instructions  
for Form 8990. Also see Schedule K, Question 23 and Question  
24, later.  
Cash contributions. For contributions of cash, check, or other  
monetary gifts (regardless of the amount), the corporation must  
maintain a bank record, or a receipt, letter, or other written  
communication from the donee organization indicating the name  
of the organization, the date of the contribution, and the amount  
of the contribution.  
Contributions of $250 or more. A corporation can deduct a  
contribution of $250 or more only if it gets a written  
Line 19. Charitable Contributions  
acknowledgment from the donee organization that shows the  
amount of cash contributed, describes any property contributed  
(but not its value), and either gives a description and a good faith  
estimate of the value of any goods or services provided in return  
for the contribution or states that no goods or services were  
provided in return for the contribution. The acknowledgment  
must be obtained by the due date (including extensions) of the  
corporation's return, or, if earlier, the date the return is filed. Do  
not attach the acknowledgment to the tax return, but keep it with  
the corporation's records.  
Enter contributions or gifts actually paid within the tax year to or  
for the use of charitable and governmental organizations  
described in section 170(c) and any unused contributions  
carried over from prior years. Special rules and limits apply to  
contributions to organizations conducting lobbying activities. See  
section 170(f)(9).  
Corporations reporting taxable income on the accrual method  
can elect to treat as paid during the tax year any contributions  
paid by the due date for filing the corporation’s tax return (not  
including extensions), if the contributions were authorized by the  
board of directors during the tax year. Attach a declaration to the  
return stating that the resolution authorizing the contributions  
was adopted by the board of directors during the tax year. The  
declaration must include the date the resolution was adopted.  
See section 170(a)(2)(B).  
Contributions of property other than cash. If a corporation  
(other than a closely held or personal service corporation)  
contributes property other than cash and claims over a $500  
deduction for the property, it must attach a statement to the  
return describing the kind of property contributed and the  
method used to determine its FMV. Closely held corporations  
and personal service corporations must complete Form 8283,  
Noncash Charitable Contributions, and attach it to their returns.  
All other corporations must generally complete and attach Form  
8283 to their returns for contributions of property (other than  
money) if the total claimed deduction for all property contributed  
was more than $5,000. Special rules apply to the contribution of  
certain property. See the Instructions for Form 8283.  
Qualified conservation contributions. Special rules apply  
to qualified conservation contributions, including contributions of  
certain easements on buildings located in a registered historic  
district. See section 170(h) and Pub. 526, Charitable  
Contributions.  
Limitation on deduction. Generally, the total amount claimed  
cannot be more than 10% of taxable income (line 30) computed  
without regard to the following.  
Any deduction for contributions.  
The special deductions on line 29b.  
The limitation under section 249 on the deduction for bond  
premium.  
Any net operating loss (NOL) carryback to the tax year under  
section 172.  
Any capital loss carryback to the tax year under section  
1212(a)(1).  
Deduction for income attributable to domestic production  
activities of specified agricultural or horticultural cooperatives.  
Other special rules. The corporation must reduce its  
deduction for contributions of certain ordinary income and  
capital gain property. See section 170(e).  
Carryover. Charitable contributions over the 10% limitation  
cannot be deducted for the tax year but can be carried over to  
the next 5 tax years. See the exception below for farmers and  
ranchers and certain Native Corporations.  
Special rules apply if the corporation has an NOL carryover to  
the tax year. In figuring the charitable contributions deduction for  
the current tax year, the 10% limit is applied using the taxable  
income after taking into account any deduction for the NOL.  
To figure the amount of any remaining NOL carryover to later  
years, taxable income must be modified (see section 172(b)). To  
the extent that contributions are used to reduce taxable income  
for this purpose and increase an NOL carryover, a contributions  
carryover is not allowed. See section 170(d)(2)(B).  
A larger deduction is allowed for certain contributions  
including:  
Inventory and other property to certain organizations for use in  
the care of the ill, needy, or infants (see section 170(e)(3)),  
including qualified contributions of “apparently wholesome food”;  
and  
Scientific equipment used for research to institutions of higher  
learning or to certain scientific research organizations (other than  
by personal holding companies and service organizations). See  
section 170(e)(4).  
For more information on charitable contributions, including  
substantiation and recordkeeping requirements, see section 170  
and the related regulations and Pub. 526. For other special rules  
that apply to corporations, see Pub. 542.  
Suspension of 10% limitation for farmers and ranchers and  
certain Native Corporations. Certain corporations can deduct  
contributions of qualified conservation property without regard to  
the general 10% limit. This applies to:  
Line 20. Depreciation  
A qualified farmer or rancher (as defined in section 170(b)(1)  
Include on line 20 depreciation and the cost of certain property  
that the corporation elected to expense under section 179 from  
Form 4562. Include amounts not claimed on Form 1125-A or  
elsewhere on the return. See Form 4562 and the Instructions for  
Form 4562.  
(E)(v)) that does not have publicly traded stock; and  
A Native Corporation (as defined in section 170(b)(2)(C)(iii))  
that contributes property which was land conveyed under the  
Alaska Native Claims Settlement Act.  
The total amount of the contribution claimed for the qualified  
conservation property cannot exceed 100% of the excess of the  
corporation's taxable income (as computed above substituting  
14  
Instructions for Form 1120  
       
Certain costs of a qualified film, television, or live theatrical  
Line 21. Depletion  
production commencing before January 1, 2026 (after  
December 31, 2015, and before January 1, 2026, for a live  
theatrical production). This deduction does not apply to any  
portion of the aggregate cost of the production above $15  
million. There is a higher allowance for production in certain  
areas. See section 181 and the related regulations.  
If the corporation has an economic interest in mineral property or  
standing timber, it can take a deduction for depletion. More than  
one person can have an economic interest in the same mineral  
deposit or timber. In the case of leased property, the depletion  
deduction is divided between the lessor and the lessee.  
Note. Certain film, television, or live theatrical productions  
acquired and placed in service after September 27, 2017 (for  
which a deduction would have been allowable under section 181  
without regard to the dollar limitation), are qualified property  
eligible for the special depreciation allowance under section  
168(k). See the Instructions for Form 4562.  
See sections 613 and 613A for percentage depletion rates  
applicable to natural deposits. Also, see section 291 for the  
limitation on the depletion deduction for iron ore and coal  
(including lignite).  
Attach Form T (Timber), Forest Activities Schedule, if a  
deduction for depletion of timber is taken.  
Certain business start-up and organizational costs (discussed  
earlier, under Limitations on Deductions).  
Foreign intangible drilling costs and foreign exploration and  
development costs must either be added to the corporation's  
basis for cost depletion purposes or be deducted ratably over a  
10-year period. See sections 263(i), 616, and 617 for details.  
Reforestation costs. The corporation can elect to deduct up to  
$10,000 of qualifying reforestation expenses for each qualified  
timber property. The corporation can elect to amortize over 84  
months any amount not deducted. See the Instructions for Form  
T (Timber).  
Line 23. Pension, Profit-Sharing, etc., Plans  
Insurance premiums.  
Enter the deduction for contributions to qualified pension,  
profit-sharing, or other funded deferred compensation plans.  
Employers who maintain such a plan must generally file one of  
the forms listed below unless exempt from filing under  
regulations or other applicable guidance, even if the plan is not a  
qualified plan under the Internal Revenue Code. The filing  
requirement applies even if the corporation does not claim a  
deduction for the current tax year. There are penalties for failure  
to file these forms on time and for overstating the pension plan  
deduction. See sections 6652(e) and 6662(f). Also, see the  
instructions for the applicable form.  
Legal and professional fees.  
Supplies used and consumed in the business.  
Travel, meals, and entertainment expenses. Special rules  
apply (discussed later).  
Utilities.  
Ordinary losses from trade or business activities of a  
partnership (from Schedule K-1 (Form 1065)). Do not offset  
ordinary income against ordinary losses. Instead, include the  
income on line 10. Show the partnership's name, address, and  
EIN on a separate statement attached to this return. If the  
amount is from more than one partnership, identify the amount  
from each partnership.  
Form 5500, Annual Return/Report of Employee Benefit Plan.  
Any extraterritorial income exclusion (from Form 8873).  
Form 5500-SF, Short Form Annual Return/Report of Small  
Employee Benefit Plan. File this form instead of Form 5500  
generally if there were under 100 participants at the beginning of  
the plan year.  
Any net negative section 481(a) adjustment, or in the case of  
an eligible terminated S corporation, the ratable portion of any  
negative section 481(a) adjustment. See Section 481(a)  
adjustment, earlier.  
Dividends paid in cash on stock held by an employee stock  
Note. Form 5500 and Form 5500-SF must be filed electronically  
under the computerized ERISA Filing Acceptance System  
(EFAST2). For more information, see the EFAST2 website at  
ownership plan.  
However, a deduction may be taken for these dividends only if,  
according to the plan, the dividends are:  
1. Paid in cash directly to the plan participants or  
beneficiaries;  
Form 5500-EZ, Annual Return of A One-Participant (Owners/  
Partners and Their Spouses) Retirement Plan or A Foreign Plan.  
File this form for a plan that only covers the owner (or the owner  
and spouse) or a foreign plan that is required to file an annual  
return and does not file the annual return electronically on Form  
5500-SF. See the Instructions for Form 5500-EZ.  
2. Paid to the plan, which distributes them in cash to the  
plan participants or their beneficiaries no later than 90 days after  
the end of the plan year in which the dividends are paid;  
3. At the election of such participants or their beneficiaries  
(a) payable as provided under (1) or (2) above, or (b) paid to the  
plan and reinvested in qualifying employer securities; or  
Line 24. Employee Benefit Programs  
4. Used to make payments on a loan described in section  
Enter contributions to employee benefit programs not claimed  
elsewhere on the return (for example, insurance or health and  
welfare programs) that are not an incidental part of a pension,  
profit-sharing, etc., plan included on line 23.  
404(a)(9).  
See section 404(k) for more details and the limitation on certain  
dividends.  
Do not deduct expenses such as the following.  
Line 25. Energy Efficient Commercial Buildings  
Deduction  
Amounts paid or incurred to, or at the direction of, a  
government or governmental entity for the violation, or  
investigation or inquiry into the potential violation, of a law.  
However, see Fines or similar penalties, later.  
Complete and attach Form 7205 if claiming the energy efficient  
commercial building deduction. See the Instructions for Form  
7205 for more information. Also, see section 179D.  
Any amount that is allocable to a class of exempt income. See  
section 265(b) for exceptions.  
Line 26. Other Deductions  
Lobbying expenses. However, see exceptions discussed later.  
Amounts paid or incurred for any settlement, payout, or  
Attach a statement, listing by type and amount, all allowable  
deductions that are not deductible elsewhere on Form 1120.  
Enter the total on line 26.  
attorney fees related to sexual harassment or sexual abuse, if  
such payments are subject to a nondisclosure agreement. See  
section 162(q).  
Examples of other deductions include the following.  
Amortization. See Part VI of Form 4562.  
15  
Instructions for Form 1120  
           
of, a government or governmental entity for violating any law, or  
for the investigation or inquiry into the potential violation of a law,  
except:  
Travel, meals, and entertainment. Subject to limitations and  
restrictions discussed below, a corporation can deduct ordinary  
and necessary travel, meal, and non-entertainment expenses  
paid or incurred in its trade or business. Generally, entertainment  
expenses, membership dues, and facilities used in connection  
with these activities cannot be deducted. In addition, no  
deduction is generally allowed for qualified transportation fringe  
benefits. Special rules apply to deductions for gifts, luxury water  
travel, and convention expenses. See section 274 and Pub. 463,  
for details.  
Amounts that constitute restitution or remediation of property,  
Amounts paid to come into compliance with the law,  
Amounts paid or incurred as the result of orders or  
agreements in which no government or governmental entity is a  
party, and  
Amounts paid or incurred for taxes due.  
No deduction is allowed unless the amounts are specifically  
identified in the order or agreement and the corporation  
establishes that the amounts were paid for that purpose. Also,  
any amount paid or incurred as reimbursement to the  
government for the costs of any investigation or litigation are not  
eligible for the exceptions and are nondeductible. See section  
162(f).  
Travel. The corporation cannot deduct travel expenses of any  
individual accompanying a corporate officer or employee,  
including a spouse or dependent of the officer or employee,  
unless:  
That individual is an employee of the corporation, and  
That individual’s travel is for a bona fide business purpose and  
would otherwise be deductible by that individual.  
Meals. Generally, the corporation can deduct only 50% of the  
amount otherwise allowable for non-entertainment-related meal  
expenses paid or incurred in its trade or business. Meals not  
separately stated from entertainment are generally not  
deductible. In addition (subject to exceptions under section  
274(k)(2)):  
Lobbying expenses. Generally, lobbying expenses are not  
deductible. These expenses include:  
Amounts paid or incurred in connection with influencing  
federal, state, or local legislation; or  
Amounts paid or incurred in connection with any  
communication with certain federal executive branch officials in  
an attempt to influence the official actions or positions of the  
officials. See Regulations section 1.162-29 for the definition of  
“influencing legislation.”  
Meals must not be lavish or extravagant, and  
An employee of the corporation must be present at the meal.  
See section 274(n)(3) for a special rule that applies to  
Dues and other similar amounts paid to certain tax-exempt  
organizations may not be deductible. If certain in-house lobbying  
expenditures do not exceed $2,000, they are deductible.  
expenses for meals consumed by individuals subject to the  
hours of service limits of the Department of Transportation.  
Qualified transportation fringes (QTFs). Generally, no  
deduction is allowed under section 274(a)(4) for QTFs provided  
by employers to their employees. QTFs are defined in section  
132(f)(1) and include:  
Line 28. Taxable Income Before NOL Deduction  
and Special Deductions  
At-risk rules. Generally, special at-risk rules under section 465  
apply to closely held corporations (see Passive activity  
limitations, earlier) engaged in any activity as a trade or business  
or for the production of income. These corporations may have to  
adjust the amount on line 28. (See below.)  
Transportation in a commuter highway vehicle between the  
employee's residence and place of employment,  
Any transit pass, and  
Qualified parking.  
See section 274 and Pub. 15-B, Employers Tax Guide to  
Fringe Benefits, for details.  
The at-risk rules do not apply to:  
Holding real property placed in service by the taxpayer before  
Membership dues. The corporation can deduct amounts  
paid or incurred for membership dues in civic or public service  
organizations, professional organizations (such as bar and  
medical associations), business leagues, trade associations,  
chambers of commerce, boards of trade, and real estate boards.  
However, no deduction is allowed if a principal purpose of the  
organization is to entertain or provide entertainment facilities for  
members or their guests. In addition, corporations cannot deduct  
membership dues in any club organized for business, pleasure,  
recreation, or other social purpose. This includes country clubs,  
golf and athletic clubs, airline and hotel clubs, and clubs  
operated to provide meals under conditions favorable to  
business discussion.  
Entertainment facilities. Generally, the corporation cannot  
deduct an expense paid or incurred for a facility (such as a yacht  
or hunting lodge) used for an activity usually considered  
entertainment, amusement, or recreation.  
Amounts treated as compensation. Generally, the  
corporation may be able to deduct otherwise nondeductible  
entertainment, amusement, or recreation expenses if the  
amounts are treated as compensation to the recipient and  
reported on Form W-2 for an employee or on Form 1099-NEC for  
an independent contractor.  
1987;  
Equipment leasing under sections 465(c)(4), (5), and (6); or  
Any qualifying business of a qualified corporation under  
section 465(c)(7).  
However, the at-risk rules do apply to the holding of mineral  
property.  
If the at-risk rules apply, adjust the amount on this line for any  
section 465(d) losses. These losses are limited to the amount for  
which the corporation is at risk for each separate activity at the  
close of the tax year. If the corporation is involved in one or more  
activities, any of which incurs a loss for the year, report the  
losses for each activity separately. Attach Form 6198, At-Risk  
Limitations, showing the amount at risk and gross income and  
deductions for the activities with the losses.  
If the corporation sells or otherwise disposes of an asset or its  
interest (either total or partial) in an activity to which the at-risk  
rules apply, determine the net profit or loss from the activity by  
combining the gain or loss on the sale or disposition with the  
profit or loss from the activity. If the corporation has a net loss, it  
may be limited because of the at-risk rules.  
Treat any loss from an activity not allowed for the tax year as a  
deduction allocable to the activity in the next tax year.  
However, if the recipient is an officer, director, beneficial  
owner (directly or indirectly), or other “specified individual” (as  
defined in section 274(e)(2)(B) and Regulations section  
1.274-9(b)), special rules apply.  
Line 29a. Net Operating Loss Deduction  
A corporation can use the NOL incurred in one tax year to  
reduce its taxable income in another tax year. Enter on line 29a  
the total NOL carryovers from other tax years, but do not enter  
more than the corporation's taxable income (after special  
Fines or similar penalties. Generally, no deduction is allowed  
for fines or similar penalties paid or incurred to, or at the direction  
16  
Instructions for Form 1120  
         
deductions). Attach a statement showing the computation of the  
NOL deduction. Complete item 12 on Schedule K.  
2. 80% of the excess, if any, of taxable income determined  
without any NOL deduction, section 199A deduction, or section  
250 deduction, over any NOL carryover to the tax year from tax  
years beginning before January 1, 2018.  
The following special rules apply.  
If an ownership change (described in section 382(g)) occurs,  
the amount of the taxable income of a loss corporation that may  
be offset by the pre-change NOL carryovers may be limited. See  
section 382 and the related regulations. A loss corporation must  
include the information statement as provided in Regulations  
section 1.382-11(a) with its income tax return for each tax year  
that it is a loss corporation in which an ownership shift, equity  
structure shift, or other transaction described in Temporary  
Regulations section 1.382-2T(a)(2)(i) occurs. If the corporation  
makes the closing-of-the-books election, see Regulations  
section 1.382-6(b).  
An exception applies for NOLs of insurance companies other  
than life insurance companies. The 80% taxable income limit  
does not apply to these entities. See sections 172(b) and (f).  
Merchant Marine capital construction fund. To take a  
deduction for amounts contributed to a capital construction fund  
(CCF), reduce the amount that would otherwise be entered on  
line 30 by the amount of the deduction. On the dotted line next to  
the entry space, enter “CCF” and the amount of the deduction.  
For more information, see section 7518.  
The limitations under section 382 do not apply to certain  
ownership changes after February 17, 2009, made pursuant to a  
restructuring plan under the Emergency Economic Stabilization  
Act of 2008. See section 382(n).  
For guidance in applying section 382 to loss corporations  
whose instruments were acquired by Treasury under certain  
programs under the Emergency Economic Stabilization Act of  
2008, see Notice 2010-2, 2010-2 I.R.B. 251.  
Line 32  
Reserved for future use.  
Line 34. Estimated Tax Penalty  
Generally, the corporation does not have to file Form 2220  
because the IRS can figure the penalty amount, if any, and bill  
the corporation. However, even if the corporation does not owe  
the penalty, it must complete and attach Form 2220 if:  
If a corporation acquires control of another corporation (or  
The annualized income or adjusted method is used, or  
The corporation is a large corporation (as defined in the  
acquires its assets in a reorganization), the amount of  
pre-acquisition losses that may offset recognized built-in gain  
may be limited (see section 384).  
Instructions for Form 2220) computing its first required  
installment based on the prior year's tax.  
If a corporation elects the alternative tax on qualifying  
shipping activities under section 1354, no deduction is allowed  
for an NOL attributable to the qualifying shipping activities to the  
extent that the loss is carried forward from a tax year preceding  
the first tax year for which the alternative tax election was made.  
See section 1358(b)(2).  
If Form 2220 is attached, check the box on line 34, and enter  
any penalty on this line.  
If the corporation's tax liability includes a CAMT liability,  
the corporation must complete and attach Form 2220.  
!
CAUTION  
The affected corporation must also include an amount of  
For more details on the NOL deduction, see section 172 and  
the Instructions for Form 1139.  
estimated tax penalty on Form 1120, line 34, even if that amount  
is zero. Failure to follow these instructions could result in the  
corporation receiving a penalty notice that will require an  
abatement request to apply any penalty relief. See Notice  
Line 29b. Special Deductions  
See the instructions for Schedule C.  
Line 30. Taxable Income  
Line 35. Amount Owed  
If the corporation cannot pay the full amount of tax owed, it can  
apply for an installment agreement online. The corporation can  
apply for an installment agreement online if:  
Minimum taxable income. The corporation's taxable income  
cannot be less than the largest of the following amounts.  
The inversion gain of the corporation for the tax year, if the  
It cannot pay the full amount shown on line 35,  
The total amount owed is $25,000 or less, and  
The corporation can pay the liability in full in 24 months.  
corporation is an expatriated entity or a partner in an expatriated  
entity. See section 7874(a).  
The sum of the corporation's excess inclusions from its  
To apply using the Online Payment Agreement Application, go to  
residual interest in a REMIC from Schedules Q (Form 1066),  
line 2c, and the corporation's taxable income determined solely  
with respect to its ownership and high-yield interests in FASITs.  
See sections 860E(a) and 860J (repealed).  
Under an installment agreement, the corporation can pay  
what it owes in monthly installments. There are certain  
conditions that must be met to enter into and maintain an  
installment agreement, such as paying the liability within 24  
months and making all required deposits and timely filing tax  
returns during the length of the agreement.  
Net operating loss (NOL). If line 30 (figured without regard to  
the items listed above under minimum taxable income) is zero or  
less, the corporation may have an NOL that can be carried back  
or forward as a deduction to other tax years.  
Only farming losses and losses of an insurance company  
(other than a life insurance company) can be carried back. The  
carryback period for these losses is 2 years. For NOLs that can  
be carried back, the corporation can elect to waive the carryback  
period and instead carry the NOL forward to future tax years.  
See the instructions for Schedule K, Item 11 for information  
on making the election to waive the carryback period. See the  
Instructions for Form 1139 for other special rules and elections.  
If the installment agreement is accepted, the corporation will  
be charged a fee and it will be subject to penalties and interest  
on the amount of tax not paid by the due date of the return.  
Line 37  
Enter the amount of any overpayment that should be refunded or  
applied to next year's estimated tax.  
Note. This election to apply some or all of the overpayment  
amount to the corporation's 2024 estimated tax cannot be  
changed at a later date.  
The NOL deduction for tax year 2023 cannot exceed the  
aggregate amount of NOLs arising in tax years beginning before  
January 1, 2018, carried to such year plus the lesser of:  
1. The aggregate amount of NOLs arising in tax years  
Direct deposit of refund. If the corporation wants its refund  
beginning after December 31, 2017, carried to such tax year; or  
directly deposited into its checking or savings account at any  
17  
Instructions for Form 1120  
         
U.S. bank or other financial institution instead of having a check  
sent to the corporation, complete Form 8050, Direct Deposit of  
Corporate Tax Refund, and attach it to the corporation's tax  
return.  
Line 3, Columns (b) and (c)  
Dividends received on certain debt-financed stock acquired after  
July 18, 1984, are not entitled to the full 50% or 65%  
dividends-received deduction under section 243 or 245(a). The  
50% or 65% deduction is reduced by a percentage that is related  
to the amount of debt incurred to acquire the stock. See section  
246A. Also, see section 245(a) before making this computation  
for an additional limitation that applies to certain dividends  
received from foreign corporations. Attach a statement to Form  
1120 showing how the amount on line 3, column (c), was figured.  
Schedule C. Dividends, Inclusions,  
and Special Deductions  
For purposes of the 20% ownership test on lines 1 through 7, the  
percentage of stock owned by the corporation is based on voting  
power and value of the stock. Preferred stock described in  
section 1504(a)(4) is not taken into account.  
Line 4, Column (a)  
Enter dividends received on preferred stock of a  
Consolidated returns. Corporations filing a consolidated  
return should see Regulations sections 1.1502-13, 1.1502-26,  
and 1.1502-27 before completing Schedule C.  
Corporations filing a consolidated return must not report as  
dividends on Schedule C any amounts received from  
corporations within the consolidated group. Such dividends are  
eliminated in consolidation rather than offset by the  
dividends-received deduction.  
less-than-20%-owned public utility that is subject to income tax  
and is allowed the 23.3% deduction provided in sections 244  
and 247 (as affected by P.L.113-295, Div. A, section 221(a)(41)  
(A), Dec. 19, 2014, 128 Stat. 4043) for dividends paid.  
Line 5, Column (a)  
Enter dividends received on preferred stock of a  
20%-or-more-owned public utility that is subject to income tax  
and is allowed the 26.7% deduction provided in sections 244  
and 247 (as affected by P.L.113-295, Div. A, section 221(a)(41)  
(A), Dec. 19, 2014, 128 Stat. 4043) for dividends paid.  
Line 1, Column (a)  
Enter dividends (except those received on certain debt-financed  
stock acquired after July 18, 1984—see section 246A) that are:  
Received from less-than-20%-owned domestic corporations  
Line 6, Column (a)  
subject to income tax, and  
Enter the U.S.-source portion of dividends that:  
Qualified for the 50% deduction under section 243(a)(1).  
Are received from less-than-20%-owned foreign corporations,  
Also, include on line 1 the following.  
and  
Taxable distributions from an IC-DISC or former DISC that are  
Qualify for the 50% deduction under section 245(a). To qualify  
designated as eligible for the 50% deduction and certain  
for the 50% deduction, the corporation must own at least 10% of  
the stock of the foreign corporation by vote and value.  
dividends of Federal Home Loan Banks. See section 246(a)(2).  
Dividends (except those received on certain debt-financed  
Also, include dividends received from a  
less-than-20%-owned FSC that:  
stock acquired after July 18, 1984) from a regulated investment  
company (RIC). The amount of dividends eligible for the  
dividends-received deduction under section 243 is limited by  
section 854(b). The corporation should receive a notice from the  
RIC specifying the amount of dividends that qualify for the  
deduction.  
Are attributable to income treated as effectively connected  
with the conduct of a trade or business within the United States  
(excluding foreign trade income), and  
Qualify for the 50% deduction under section 245(c)(1)(B).  
Report so-called dividends or earnings received from mutual  
savings banks, etc., as interest. Do not treat them as dividends.  
Line 7, Column (a)  
Enter the U.S.-source portion of dividends that:  
Are received from 20%-or-more-owned foreign corporations,  
Line 2, Column (a)  
and  
Qualify for the 65% deduction under sections 243 and 245(a).  
Enter on line 2:  
Dividends (except those received on certain debt-financed  
Also, include dividends received from a 20%-or-more-owned  
FSC that:  
stock acquired after July 18, 1984) that are received from  
20%-or-more-owned domestic corporations subject to income  
tax and that are subject to the 65% deduction under section  
243(c), and  
Are attributable to income treated as effectively connected  
with the conduct of a trade or business within the United States  
(excluding foreign trade income), and  
Taxable distributions from an IC-DISC or former DISC that are  
considered eligible for the 65% deduction.  
Qualify for the 65% deduction under section 245(c)(1)(B).  
Line 3, Column (a)  
Line 8, Column (a)  
Enter the following.  
Enter dividends received from wholly owned foreign subsidiaries  
that are eligible for the 100% deduction under section 245(b).  
Dividends received on certain debt-financed stock acquired  
after July 18, 1984, from domestic and foreign corporations  
subject to income tax that would otherwise be subject to the  
dividends-received deduction under section 243(a)(1), 243(c), or  
245(a). Generally, debt-financed stock is stock that the  
corporation acquired by incurring a debt (for example, it  
borrowed money to buy the stock).  
In general, the deduction under section 245(b) applies to  
dividends paid out of the earnings and profits of a foreign  
corporation for a tax year during which:  
All of its outstanding stock is directly or indirectly owned by  
the domestic corporation receiving the dividends, and  
All of its gross income from all sources is effectively  
Dividends received from a RIC on debt-financed stock. The  
connected with the conduct of a trade or business within the  
United States.  
amount of dividends eligible for the dividends-received  
deduction is limited by section 854(b). The corporation should  
receive a notice from the RIC specifying the amount of dividends  
that qualify for the deduction.  
Line 9, Column (c)  
Generally, line 9, column (c), cannot exceed the amount from the  
Worksheet for Schedule C, line 9. However, in a year in which an  
18  
Instructions for Form 1120  
   
NOL occurs, this limitation does not apply even if the loss is  
created by the dividends-received deduction. See sections  
172(d) and 246(b).  
section 245A deduction pursuant to Regulations section  
1.245A-5(g)(2). Include such amounts on line 16c.)  
Line 16b, Column (a)  
Line 10, Columns (a) and (c)  
Enter the total subpart F inclusions attributable to tiered hybrid  
dividends. This should equal the sum of the amounts reported by  
the U.S. shareholder on Form(s) 5471, Schedule I, line 1b.  
Small business investment companies operating under the Small  
Business Investment Act of 1958 must enter dividends that are  
received from domestic corporations subject to income tax even  
though a deduction is allowed for the entire amount of those  
dividends. To claim the 100% deduction on line 10, column (c),  
the company must file with its return a statement that it was a  
federal licensee under the Small Business Investment Act of  
1958 at the time it received the dividends.  
Line 16c, Column (a)  
Enter all other amounts included in income under section 951.  
This should equal the sum of the amounts reported by the U.S.  
shareholder on Form(s) 5471, Schedule I, lines 1(c) through  
1(h), 2, and 4.  
Line 11, Columns (a) and (c)  
Line 17, Column (a)  
Enter only dividends that qualify under section 243(b) for the  
100% dividends-received deduction described in section 243(a)  
(3). Corporations taking this deduction are subject to the  
provisions of section 1561.  
Enter amounts included in income under section 951A. See  
Form 8992, Part II, line 5, and the Instructions for Form 8992.  
Also, if applicable, attach Form(s) 5471.  
Note. Consider the applicability of section 951A with respect to  
CFCs owned by domestic partnerships in which the corporation  
has an interest.  
The 100% deduction does not apply to affiliated group  
members that are joining in the filing of a consolidated return.  
Line 12, Column (a)  
Line 18, Column (a)  
Enter dividends from FSCs that are attributable to foreign trade  
income and that are eligible for the 100% deduction provided in  
section 245(c)(1)(A).  
Include gross-up for taxes deemed paid under section 960.  
Line 19, Column (a)  
Enter taxable distributions from an IC-DISC or former DISC that  
are designated as not eligible for a dividends-received  
deduction.  
Line 13, Column (a)  
Enter the foreign-source portion of dividends that:  
Are received from specified 10%-owned foreign corporations  
No deduction is allowed under section 243 for a dividend from  
an IC-DISC or former DISC (as defined in section 992(a)) to the  
extent the dividend:  
(as defined in section 245A(b)), including, for example, gain from  
the sale of stock of a foreign corporation that is treated as a  
dividend under sections 1248(a) and (j); and  
Is paid out of the corporation's accumulated IC-DISC income  
Qualify for the section 245A deduction.  
or previously taxed income, or  
Is a deemed distribution under section 995(b)(1).  
Line 14, Column (a)  
Enter the foreign dividends not reportable on line 3, 6, 7, 8, 11,  
12, or 13 of column (a).  
Line 20, Column (a)  
Include the following.  
Include on line 14 the foreign-source portion of any dividend  
that does not qualify for the section 245A deduction (for  
example, hybrid dividends within the meaning of section  
245A(e), ineligible amounts of dividends within the meaning of  
Regulations section 1.245A-5(b), dividends that fail to meet the  
holding period requirement under section 246(c)(5), etc.).  
1. Dividends (other than capital gain distributions reported  
on Schedule D (Form 1120), Capital Gains and Losses, and  
exempt-interest dividends) that are received from RICs and that  
are not subject to the 50% deduction.  
2. Dividends from tax-exempt organizations.  
3. Dividends (other than capital gain distributions) received  
from a REIT that, for the tax year of the trust in which the  
dividends are paid, qualifies under sections 856 through 860.  
Also, include on line 14 the corporation's share of  
distributions from a section 1291 fund from Form 8621, to the  
extent that the amounts are taxed as dividends under section  
301. See Form 8621 and the Instructions for Form 8621.  
4. Dividends not eligible for a dividends-received deduction,  
which include the following.  
Attach a statement identifying the amount of each dividend  
reported on line 14 and the provision pursuant to which a  
deduction is not allowed with respect to such dividend.  
a. Dividends received on any share of stock held for less  
than 46 days during the 91-day period beginning 45 days before  
the ex-dividend date. When counting the number of days the  
corporation held the stock, you cannot count certain days during  
which the corporation's risk of loss was diminished. See section  
246(c)(4) and Regulations section 1.246-5 for more details.  
Line 15, Column (a)  
Reserved for future use.  
b. Dividends received on any share of preferred stock which  
are attributable to periods totaling more than 366 days if such  
stock was held for less than 91 days during the 181-day period  
that began 90 days before the ex-dividend date. When counting  
the number of days the corporation held the stock, you cannot  
count certain days during which the corporation's risk of loss was  
diminished. See section 246(c)(4) and Regulations section  
1.246-5 for more details. Preferred dividends attributable to  
periods totaling less than 367 days are subject to the 46-day  
holding period rule discussed above.  
Line 15, Column (c)  
Reserved for future use.  
Line 16a, Column (a)  
Enter the foreign-source portion of any subpart F inclusions  
attributable to the sale or exchange by a CFC of stock in another  
foreign corporation described in section 964(e)(4). This should  
equal the sum of the amounts reported by the U.S. shareholder  
on Form(s) 5471, Schedule I, line 1a. (Do not include on line 16a  
any portion of such subpart F inclusion that is not eligible for the  
19  
Instructions for Form 1120  
Keep for Your Records  
Worksheet for Schedule C, line 9  
1. Refigure Form 1120, page 1, line 28, without any adjustment under section 1059 and without any capital loss  
carryback to the tax year under section 1212(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
1.  
2.  
3.  
4.  
2. Complete lines 10, 11, 12, and 13, column (c), and enter the total here . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
3. Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
4. Multiply line 3 by 65% (0.65) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
5. Add lines 2, 5, 7, and 8, column (c), and the part of the deduction on line 3, column (c), that is attributable to  
dividends from 20%-or-more-owned corporations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
5.  
6.  
6. Enter the smaller of line 4 or line 5. If line 5 is greater than line 4, stop here; enter the amount from line 6 on line 9,  
column (c), and do not complete the rest of this worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
7. Enter the total amount of dividends from 20%-or-more-owned corporations that are included on lines 2, 3, 5, 7,  
and 8, column (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
7.  
8.  
8. Subtract line 7 from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
9. Multiply line 8 by 50% (0.50) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
10. Subtract line 5 from line 9, column (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
11. Enter the smaller of line 9 or line 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
9.  
10.  
11.  
12. Dividends-received deduction after limitation (sec. 246(b)). Add lines 6 and 11. Enter the result here and on  
line 9, column (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  
12.  
c. Dividends on any share of stock to the extent the  
corporation is under an obligation (including a short sale) to  
make related payments with respect to positions in substantially  
similar or related property.  
department. Enter the combined tax on line 1. Attach Form  
1120-L as a schedule (and identify it as such), together with the  
annual statements and schedules required to be filed with Form  
1120-L. See Regulations section 1.6012-2(c)(1)(ii).  
Exception for insurance companies filing their federal  
income tax returns electronically. If an insurance company  
files its income tax return electronically, it should not include the  
annual statements and schedules required to be filed with Form  
1120-L. However, such statements must be available at all times  
for inspection by the IRS and retained for so long as such  
statements may be material in the administration of any Internal  
Revenue law.  
5. Any other taxable dividend income not properly reported  
elsewhere on Schedule C.  
If patronage dividends or per-unit retain allocations are  
included on line 20, identify the total of these amounts in a  
statement attached to Form 1120.  
Line 21, Column (c)  
Section 247 (as affected by P.L.113-295, Div. A, section 221(a)  
(41)(A), Dec. 19, 2014, 128 Stat. 4043) allows public utilities a  
deduction of 40% of the smaller of (a) dividends paid on their  
preferred stock during the tax year, or (b) taxable income  
computed without regard to this deduction. In a year in which an  
NOL occurs, compute the deduction without regard to section  
247(a)(1)(B).  
Deferred tax under section 1291. If the corporation was a  
shareholder in a PFIC and received an excess distribution or  
disposed of its investment in the PFIC during the year, it must  
include the increase in taxes due under section 1291(c)(2) (from  
Form 8621) in the total for line 1. On the dotted line next to line 1,  
enter “Section 1291” and the amount.  
Do not include on line 1 any interest due under section  
1291(c)(3). Instead, include the amount of interest owed on  
Schedule J, Part I, line 9z.  
Line 22, Column (c)  
Enter the section 250 deduction claimed for foreign-derived  
intangible income (FDII) and global intangible low-taxed income  
(GILTI). This should equal the sum of the amounts on Form  
8993, Part III, lines 28 and 29.  
For more information on reporting the deferred tax and  
interest, see the Instructions for Form 8621.  
Increase in tax attributable to partner's audit liability under  
section 6226. If the corporation is filing Form 8978, Partner’s  
Additional Reporting Year Tax, to report adjustments shown on  
Form 8986, Push Out to Partners under IRC 6226(a)(2), they  
received from partnerships that have been audited and have  
elected to push out imputed underpayments to their partners,  
include any increase in taxes due from Form 8978, line 14, in the  
total for Form 1120, Schedule J, line 1. On the dotted line next to  
line 1, enter "FROM FORM 8978" and the amount. Attach Form  
8978. If Form 8978, line 14, shows a decrease in tax, see the  
instructions for Schedule J, line 6.  
Schedule J.  
Tax Computation and Payment  
Part I—Tax Computation  
Line 1  
Multiply taxable income (page 1, line 30) by 21% (0.21). Enter  
this amount on line 1.  
Additional tax under section 197(f). A corporation that elects  
to recognize gain and pay tax on the sale of a section 197  
intangible under the related person exception to the  
Mutual savings bank conducting life insurance business.  
The tax under section 594 consists of the sum of (a) a partial tax  
computed on Form 1120 on the taxable income of the bank,  
determined without regard to income or deductions allocable to  
the life insurance department, and (b) a partial tax on the taxable  
income computed on Form 1120-L of the life insurance  
anti-churning rules should include any additional tax due in the  
total for line 1. On the dotted line next to line 1, enter “Section  
197” and the amount. See section 197(f)(9)(B)(ii).  
20  
Instructions for Form 1120  
           
the end of the 5-year recapture period under section 50(a), enter  
the increase in tax from Form 4255. See the Instructions for  
Form 4255.  
Line 2  
If the corporation had gross receipts of at least $500 million in  
any 1 of the 3 tax years preceding the current tax year, complete  
and attach Form 8991. Enter on line 2 the base erosion minimum  
tax amount from Form 8991, Part IV, line 5e. See section 59A  
and the Instructions for Form 8991. Also, see Schedule K,  
Question 22, later.  
Line 9b. Recapture of low-income housing credit. If the  
corporation disposed of property (or there was a reduction in the  
qualified basis of the property) for which it took the low-income  
housing credit, and the corporation did not follow the procedures  
that would have prevented recapture of the credit, it may owe a  
tax. See Form 8611.  
Line 3  
Line 9c. Interest due under the look-back method—com-  
pleted long-term contracts. If the corporation used the  
percentage-of-completion method under section 460(b) for  
certain long-term contracts, figure any interest due or to be  
refunded using the look-back method, described in section  
460(b)(2). Use Form 8697 to figure any interest due or to be  
refunded. See the Instructions for Form 8697. Include any  
interest due on line 9c.  
Enter on line 3 the amount from Form 4626, Alternative Minimum  
Tax—Corporations, Part II, line 13, if applicable. See the  
Instructions for Form 4626.  
Line 5  
Line 5a. To find out when a corporation can take the credit for  
payment of income tax to a foreign country or U.S. territory, see  
Form 1118, Foreign Tax Credit—Corporations.  
Line 9d. Interest due under the look-back method—income  
forecast method. If the corporation used the income forecast  
method to depreciate property, it must figure any interest due or  
to be refunded using the look-back method, described in section  
167(g)(2). Use Form 8866 to figure any interest due or to be  
refunded. See the Instructions for Form 8866. Include any  
interest due on line 9d.  
Line 5b. Enter any qualified electric vehicle passive activity  
credits from prior years allowed for the current tax year from  
Form 8834, Qualified Electric Vehicle Credit, line 7. Attach Form  
8834.  
Line 5c. Use Form 3800 to claim any general business credits.  
Enter on line 5c the allowable credit from Form 3800, Part II,  
line 38. See the Instructions for Form 3800.  
Line 9e. Alternative tax on qualifying shipping activities.  
Enter any alternative tax on qualifying shipping activities from  
Form 8902.  
Line 5d. Enter any allowable credit from Form 8827, Credit for  
Prior Year Minimum Tax—Corporations. Complete and attach  
Form 8827.  
Line 9f. Interest/tax due under section 453A(c). Include any  
interest on deferred tax attributable to certain nondealer  
installment obligations (section 453A(c)).  
Line 5e. Enter the allowable credits from Form 8912, Credit to  
Line 9g. Interest/tax due under section 453(l). Include any  
interest on deferred tax attributable to dealer installment  
obligations (section 453(l)).  
Holders of Tax Credit Bonds, line 12.  
Line 6  
Line 9z. Other. Include on line 9z additional taxes and interest  
such as the following. Attach a statement showing the  
computation of each item included in the total for line 9z and  
identify the applicable Code section and the type of tax or  
interest.  
Add lines 5a through 5e. Enter the total on line 6.  
Decrease attributable to partner's audit liability under sec-  
tion 6226. If the corporation is filing Form 8978 to report  
adjustments shown on Form 8986 they received from  
Recapture of Indian employment credit. Generally, if an  
employer terminates the employment of a qualified employee  
less than 1 year after the date of initial employment, any Indian  
employment credit allowed for a prior tax year because of wages  
paid or incurred to that employee must be recaptured. For  
details, see Form 8845 and section 45A.  
partnerships that have been audited and have elected to push  
out imputed underpayments to their partners, include any  
decrease in taxes due (negative amount) from Form 8978,  
line 14, in the total for Form 1120, Schedule J, line 6. On the  
dotted line next to line 6, enter "FROM FORM 8978" and the  
amount. Attach Form 8978. If Form 8978, line 14, shows an  
increase in tax, see the instructions for Schedule J, line 1.  
Recapture of new markets credit (see Form 8874 and Form  
8874-B, Notice of Recapture Event for New Markets Credit).  
Recapture of employer-provided childcare facilities and  
services credit (see Form 8882).  
Tax and interest on a nonqualified withdrawal from a capital  
Line 8  
construction fund (section 7518(g)).  
A corporation is taxed as a personal holding company under  
section 542 if:  
Interest due on deferred gain (section 1260(b)).  
Interest due under section 1291(c)(3). See Form 8621 and the  
At least 60% of its adjusted ordinary gross income for the tax  
Instructions for Form 8621.  
year is personal holding company income, and  
Recapture of section 45Q carbon oxide sequestration credit  
At any time during the last half of the tax year more than 50%  
(see Form 8933, Part III, line 22).  
in value of its outstanding stock is directly or indirectly owned by  
five or fewer individuals.  
Line 11  
See Schedule PH (Form 1120) for definitions and details on  
how to figure the tax.  
Include any deferred tax on the termination of a section 1294  
election applicable to shareholders in a qualified electing fund in  
the amount entered on line 11.  
Line 9  
Subtract the following amounts from the total for line 11.  
Include any of the following taxes and interest.  
Deferred tax on the corporation's share of undistributed  
Line 9a. Recapture of investment credit. If the corporation  
earnings of a qualified electing fund. See the Instructions for  
Form 8621.  
disposed of investment credit property or changed its use before  
21  
Instructions for Form 1120  
                     
Deferred LIFO recapture tax (section 1363(d)). This tax is the  
investment company (RIC) or a real estate investment trust  
(REIT) on undistributed long-term capital gains included in the  
corporation's income. Attach Form 2439.  
part of the LIFO recapture tax that will be deferred and paid with  
Form 1120-S in the future. To figure the deferred tax, first figure  
the total LIFO recapture tax. Follow the steps below to figure the  
total LIFO recapture tax and the deferred amount. Also, see  
Line 20b. Credit for federal tax on fuels. Enter the total  
income tax credit claimed on Form 4136, Credit for Federal Tax  
Paid on Fuels. Attach Form 4136.  
Step 1. Figure the tax on the corporation's income including  
the LIFO recapture amount. Complete Schedule J, Part I, lines 1  
through 10.  
Line 20c. Reserved for future use.  
Line 20z. Other. Include on line 20z any other refundable credit  
the corporation is claiming, including the following. Attach a  
statement listing the type of credit and the amount of the credit.  
Step 2. Using a separate worksheet, complete Schedule J  
again, but do not include the LIFO recapture amount in the  
corporation's taxable income.  
Credit for tax withheld under Chapter 3 or 4 of the Internal  
Revenue Code that is shown on Form 1042-S, Form 8805, or  
Form 8288-A. Attach the applicable form.  
Credit for tax on ozone-depleting chemicals. See section  
Step 3. Compare the tax in Step 2 to the tax in Step 1. The  
4682(g)(2).  
Credit under section 960(c) (section 960(b) for pre-2018 tax  
difference between the two is the LIFO recapture tax.  
years of foreign corporations). If an increase in the limitation  
under section 960(c) (section 960(b) (pre-2018)) exceeds the  
total tax on Schedule J, Part I, line 11, for the tax year, the  
amount of the excess is deemed an overpayment of tax for the  
tax year. See section 960(c) (section 960(b) (pre-2018)) for more  
information regarding the circumstances under which such an  
excess arises.  
Step 4. Multiply the amount figured in Step 3 by 75% (0.75).  
The result is the deferred LIFO recapture tax.  
How to report. Attach a statement showing the computation of  
each item included in, or subtracted from, the total for line 11. On  
the dotted line next to line 11, specify (a) the applicable Code  
section, (b) the type of tax, and (c) enter the amount of tax. For  
example, if the corporation is deferring a $100 LIFO recapture  
tax, subtract this amount from the total on line 11, then enter  
“Section 1363—Deferred Tax—$100” on the dotted line next to  
line 11.  
Line 22. Elective Payment Election Amount From  
Form 3800  
Part II—Payments and Refundable Credits  
Line 12  
Enter on line 22 the total net elective payment election amount  
from Form 3800, Part III, line 6, column (i). See the Instructions  
for Form 3800.  
Reserved for future use.  
Schedule K.  
Line 14  
Other Information  
Complete all items that apply to the corporation.  
Enter any estimated tax payments the corporation made for the  
current tax year.  
Question 2  
Beneficiaries of trusts. If the corporation is the beneficiary of a  
trust, and the trust makes a section 643(g) election to credit its  
estimated tax payments to its beneficiaries, include the  
corporation's share of the payment in the total for line 14. Enter  
“T” and the amount of the payment on the dotted line next to the  
entry space.  
See the list of Principal Business Activity Codes later in the  
instructions. Using the list of codes and activities, determine  
from which activity the corporation derives the highest  
percentage of its total receipts. Enter on lines 2a, 2b, and 2c the  
principal business activity code number, the corporation's  
business activity, and a description of the principal product or  
service of the corporation. For nonstore retailers, select the PBA  
code by the primary product that your establishment sells. For  
example, establishments primarily selling prescription and  
non-prescription drugs, select PBA code 456110 Pharmacies &  
Drug Retailers.  
Line 15  
If the corporation overpaid estimated tax, it may be able to get a  
quick refund by filing Form 4466. The overpayment must be at  
least 10% of the corporation's expected income tax liability and  
at least $500. File Form 4466 after the end of the corporation's  
tax year, and no later than the due date for filing the corporation’s  
tax return (not including extensions). Form 4466 must be filed  
before the corporation files its tax return. See the instructions for  
Form 4466.  
Question 3  
Check the “Yes” box for question 3 if:  
The corporation is a subsidiary in an affiliated group (defined  
below), but is not filing a consolidated return for the tax year with  
that group; or  
The corporation is a subsidiary in a parent–subsidiary  
Line 18  
controlled group. For a definition of a parent–subsidiary  
controlled group, see the Instructions for Schedule O (Form  
1120).  
If the corporation had federal income tax withheld from any  
payments it received because, for example, it failed to give the  
payer its correct EIN or was otherwise subjected to backup  
withholding, include the amount withheld in the total for line 18.  
Any corporation that meets either of the requirements above  
should check the “Yes” box. This applies even if the corporation  
is a subsidiary member of one group and the parent corporation  
of another.  
Line 20. Refundable Credits  
Note. If the corporation is an “excluded member” of a controlled  
Line 20a. Credit from Form 2439. Enter any credit from Form  
2439, Notice to Shareholder of Undistributed Long-Term Capital  
Gains, for the corporation's share of the tax paid by a regulated  
group (see definition in the Instructions for Schedule O (Form  
22  
Instructions for Form 1120  
                   
1120)), it is still considered a member of a controlled group for  
this purpose.  
Question 5b  
List each foreign or domestic partnership in which the  
corporation, at the end of the tax year, owned directly an interest  
of 20% or more, or owned, directly or indirectly, an interest of  
50% or more in the profit, loss, or capital of the partnership. List  
each trust in which the corporation, at the end of the tax year,  
owned directly an interest of 20% or more, or owned, directly or  
indirectly, an interest of 50% or more in the trust beneficial  
interest. Indicate the name, EIN (if any), country of organization,  
and the maximum percentage interest owned, directly or  
indirectly, in the profit, loss, or capital of the partnership at the  
end of the partnership tax year, or, for a trust, the percentage  
interest owned in the trust beneficial interest. List a partnership  
or trust owned through a disregarded entity rather than the  
disregarded entity.  
Affiliated group. An affiliated group is one or more chains of  
includible corporations (as defined in section 1504(b))  
connected through stock ownership with a common parent  
corporation. See section 1504(a). The common parent must be  
an includible corporation and the following requirements must be  
met.  
1. The common parent must own directly stock that  
represents at least 80% of the total voting power and at least  
80% of the total value of the stock of at least one of the other  
includible corporations.  
2. Stock that represents at least 80% of the total voting  
power and at least 80% of the total value of the stock of each of  
the other corporations (except for the common parent) must be  
owned directly by one or more of the other includible  
corporations.  
Maximum percentage owned in partnership profit, loss, or  
capital. For the purposes of question 5b, the term “maximum  
percentage owned” means the highest percentage of interest in  
a partnership's profit, loss, or capital as of the end of the  
partnership's tax year, as determined under the partnership  
agreement, when taking into account the constructive ownership  
rules, earlier. If the partnership agreement does not express the  
partner's share of profit, loss, and capital as fixed percentages,  
use a reasonable method in arriving at the percentage items for  
the purposes of completing question 5b. Such method must be  
consistent with the partnership agreement. The method used to  
compute a percentage share of profit, loss, and capital must be  
applied consistently from year to year. Maintain records to  
support the determination of the share of profits, losses, and  
capital.  
Example. Corporation A owns, directly, a 50% interest in the  
profit, loss, or capital of Partnership B. Corporation A also owns,  
directly, a 15% interest in the profit, loss, or capital of Partnership  
C and owns, directly, 15% of the voting stock of Corporation D.  
Partnership B owns, directly, a 70% interest in the profit, loss, or  
capital of Partnership C and owns, directly, 70% of the voting  
stock of Corporation D. Corporation A owns, indirectly, through  
Partnership B, a 35% interest (50% of 70%) in the profit, loss, or  
capital of Partnership C and owns, indirectly, 35% of the voting  
stock of Corporation D. Corporation A owns, directly or indirectly,  
a 50% interest in the profit, loss, or capital of Partnership C (15%  
directly and 35% indirectly), and owns, directly or indirectly, 50%  
of the voting stock of Corporation D (15% directly and 35%  
indirectly).  
For this purpose, the term “stock” generally does not include  
any stock that (a) is nonvoting, (b) is nonconvertible, (c) is limited  
and preferred as to dividends and does not participate  
significantly in corporate growth, and (d) has redemption and  
liquidation rights that do not exceed the issue price of the stock  
(except for a reasonable redemption or liquidation premium).  
See section 1504(a)(4).  
Question 4. Constructive Ownership of the  
Corporation  
For purposes of question 4, the constructive ownership rules of  
section 267(c) (excluding section 267(c)(3)) apply to ownership  
of interests in corporate stock and ownership of interests in the  
profit, loss, or capital of a partnership. If the corporation checked  
Yes” to question 4a or 4b, complete and attach Schedule G  
(Form 1120), Information on Certain Persons Owning the  
Corporation's Voting Stock.  
Question 5. Constructive Ownership of Other  
Entities  
For purposes of determining the corporation's constructive  
ownership of other entities, the constructive ownership rules of  
section 267(c) (excluding section 267(c)(3)) apply to ownership  
of interests in partnerships and trusts as well as corporate stock.  
Generally, if an entity (a corporation, partnership, or trust) is  
owned, directly or indirectly, by or for another entity (corporation,  
partnership, estate, or trust), the owned entity is considered to  
be owned proportionately by or for the owners (shareholders,  
partners, or beneficiaries) of the owning entity.  
Corporation A reports in its answer to question 5a that it  
owns, directly or indirectly, 50% of the voting stock of  
Corporation D. Corporation A reports in its answer to question 5b  
that it owns, directly, an interest of 50% in the profit, loss, or  
capital of Partnership B and owns, directly or indirectly, 50% of  
the profit, loss, or capital of Partnership C.  
Question 5a  
List each foreign or domestic corporation not included on Form  
851, Affiliations Schedule, in which the corporation, at the end of  
the tax year, owned directly 20% or more, or owned, directly or  
indirectly, 50% or more of the total voting power of all classes of  
stock entitled to vote. Indicate the name of the corporation, EIN  
(if any), country of incorporation, and the percentage interest  
owned, directly or indirectly, in the total voting power. List the  
parent corporation of an affiliated group of corporations filing a  
consolidated tax return rather than the subsidiary members  
except for subsidiary members in which an interest is owned,  
directly or indirectly, independent of the interest owned, directly  
or indirectly, in the parent corporation. List a corporation owned  
through a disregarded entity rather than the disregarded entity.  
Question 7  
Check the “Yes” box if one foreign person owned at least 25% of  
the total voting power of all classes of stock of the corporation  
entitled to vote or at least 25% of the total value of all classes of  
stock of the corporation.  
The constructive ownership rules of section 318 apply in  
determining if a corporation is foreign owned. See section  
6038A(c)(5) and the related regulations.  
Enter on line 7a the percentage owned by the foreign person  
specified in question 7. On line 7b, enter the name of the owner’s  
country.  
Note. If there is more than one 25%-or-more foreign owner,  
complete question 7 for the foreign person with the highest  
percentage of ownership.  
23  
Instructions for Form 1120  
   
For 2023, the corporation's total assets equal or exceed $10  
Foreign person. The term “foreign person” means:  
An individual who is not a citizen or resident of the United  
million;  
The corporation or a related party issued audited financial  
States;  
statements reporting all or a portion of the corporation's  
An individual who is a citizen or resident of a U.S. territory who  
operations for all or a portion of the corporation's tax year; and  
is not otherwise a citizen or resident of the United States;  
The corporation has one or more tax positions that must be  
Any partnership, association, company, or corporation that is  
reported on Schedule UTP.  
not created or organized in the United States;  
Any foreign estate or trust within the meaning of section  
Attach Schedule UTP to the corporation's income tax return.  
Do not file it separately. A taxpayer that files a protective Form  
1120 must also file Schedule UTP if it satisfies the requirements  
set forth above.  
7701(a)(31); or  
A foreign government (or one of its agencies or  
instrumentalities) to the extent that it is engaged in the conduct  
of a commercial activity, as described in  
section 892.  
For details, see the Instructions for Schedule UTP.  
However, the term "foreign person" does not include any  
foreign person who consents to the filing of a joint U.S. income  
tax return.  
Questions 15a and 15b  
If the corporation made any payment in 2023 that would require  
the corporation to file any Form(s) 1099, check the “Yes” box for  
question 15a and answer question 15b. Otherwise, check the  
“No” box for question 15a and skip question 15b. See Am I  
IRS.gov.  
Owner's country. For individuals, the term “owner's country”  
means the country of residence. For all others, it is the country  
where incorporated, organized, created, or administered.  
Requirement to file Form 5472. If the corporation checked  
Yes,it may have to file Form 5472, Information Return of a 25%  
Foreign-Owned U.S. Corporation or a Foreign Corporation  
Engaged in a U.S. Trade or Business. Generally, a 25%  
foreign-owned corporation that had a reportable transaction with  
a foreign or domestic related party during the tax year must file  
Form 5472. See the Instructions for Form 5472, for filing  
instructions and penalties for failure to file.  
Question 19  
If the corporation made any payments in 2023 that would require  
the corporation to file any Forms 1042, Annual Withholding Tax  
Return for U.S. Source Income of Foreign Persons, and 1042-S,  
Foreign Person's U.S. Source Income Subject to Withholding,  
check the “Yes” box. See the Instructions for Form 1042 and  
Instructions for Form 1042-S for information regarding who is  
required to file Forms 1042 and 1042-S and what types of  
payments are subject to reporting on Forms 1042 and 1042-S.  
Item 9  
Show any tax-exempt interest received or accrued. Include any  
exempt-interest dividends received as a shareholder in a mutual  
fund or other RIC. Also, if required, include the same amount on  
Schedule M-1, line 7 (or Schedule M-3 (Form 1120), Part II,  
line 13, if applicable).  
Question 21  
If the corporation paid or accrued (including through a  
partnership) any interest or royalty for which a deduction is not  
allowed under section 267A, check "Yes" for question 21 and  
enter the total amount for which a deduction is not allowed.  
Item 11  
Generally, if the corporation has an NOL for tax year 2023, it can  
elect to waive the entire carryback period for the NOL and  
instead carry the NOL forward to future tax years. To do so,  
check the box on line 11 and file the tax return by its due date,  
including extensions. Do not attach the statement described in  
Temporary Regulations section 301.9100-12T. Generally, once  
made, the election is irrevocable.  
Payments to which section 267A applies. Interest or royalty  
paid or accrued by a domestic corporation (including, in the case  
of a domestic corporation that is a partner in a partnership, the  
domestic corporation's allocable share of interest or royalty paid  
or accrued by the partnership) is subject to section 267A.  
Section 267A generally applies to interest or royalty paid or  
accrued according to a hybrid arrangement (such as, for  
example, a payment according to a hybrid instrument, or a  
payment to a reverse hybrid), provided that the payment or  
accrual is to a related party (or according to a structured  
arrangement). In addition, under an imported mismatch rule,  
section 267A generally applies to interest or royalties paid or  
accrued according to a non-hybrid arrangement where the  
income attributable to that payment or accrual is directly or  
indirectly offset by certain deductions involving hybridity incurred  
by a related party or according to a structured arrangement.  
However, section 267A does not apply if a de minimis exception  
is satisfied. See Regulations section 1.267A-1(c). For purposes  
of section 267A, interest and royalties are defined broadly. For  
additional information about arrangements subject to section  
267A, see Regulations sections 1.267A-2 and 1.267A-4. Also,  
see the anti-avoidance rule under Regulations section  
1.267A-5(b)(6).  
If the corporation timely filed its return for the loss year without  
making the election, it can make the election on an amended  
return filed within 6 months of the due date of the loss year return  
(excluding extensions). Attach the election to the amended  
return and write "Filed pursuant to section 301.9100-2" on the  
election statement. See the Instructions for Form 1139.  
Corporations filing a consolidated return that elect to waive  
the entire carryback period for the group must also attach the  
statement required by Regulations section 1.1502-21(b)(3) or  
the election will not be valid.  
Item 12  
Enter the amount of the NOL carryover to the tax year from prior  
years, even if some of the loss is used to offset income on this  
return. The amount to enter is the total of all NOLs generated in  
prior years but not used to offset income (either as a carryback  
or carryover) to a tax year prior to 2023. Do not reduce the  
amount by any NOL deduction reported on line 29a.  
Extent to which deduction is disallowed. When section  
267A applies to interest or royalties paid or accrued pursuant to  
a hybrid arrangement, it generally disallows a deduction for the  
amount to the extent that, under the foreign tax law, there is not a  
corresponding income inclusion (including long-term deferral).  
However, the deduction is not disallowed to the extent the  
amount is directly or indirectly included in income in the United  
States, such as if the amount is taken into account with respect  
Question 14  
A corporation that files Form 1120 must file Schedule UTP (Form  
1120), Uncertain Tax Position Statement, with its 2023 income  
tax return if:  
24  
Instructions for Form 1120  
   
to a U.S. shareholder under section 951(a) or section 951A. For  
additional information, see Regulations sections 1.267A-2  
through 1.267A-4. For examples illustrating the application of  
section 267A, see Regulations section 1.267A-6.  
partnerships, or proprietorships, and affiliated service groups.  
See section 448(c) and the Instructions for Form 8990 for  
additional information.  
Question 25  
Question 22  
To certify as a QOF, the corporation must file Form 1120 and  
attach Form 8996, even if the corporation had no income or  
expenses to report. If the corporation is attaching Form 8996,  
check the “Yes” box for question 25. On the line following the  
dollar sign, enter the amount from Form 8996, line 15.  
If the corporation had gross receipts of at least $500 million in  
any 1 of the 3 preceding tax years, complete and attach Form  
8991. For this purpose, the corporation's gross receipts include  
the gross receipts of all persons aggregated with the  
corporation, as specified in section 59A(e)(3). See the  
Instructions for Form 8991 to determine if the corporation is  
subject to the base erosion minimum tax.  
The penalty reported on this line from Form 8996, line 15, is  
not due with the filing of this form. The IRS will separately send  
to you a notice setting forth the due date for the penalty payment  
and where that payment should be sent.  
Question 23  
The limitation on business interest expense applies to every  
taxpayer with a trade or business, unless the taxpayer meets  
certain specified exceptions. A taxpayer may elect out of the  
limitation for certain businesses otherwise subject to the  
business interest expense limitation. See Question 24. Also, see  
the Instructions for Form 8990.  
Certain real property trades or businesses and farming  
businesses qualify to make an election not to limit business  
interest expense. This is an irrevocable election. If you make this  
election, you are required to use the alternative depreciation  
system to depreciate any nonresidential real property, residential  
rental property, and qualified improvement property for an  
electing real property trade or business, and any property with a  
recovery period of 10 years or more for an electing farming  
business. See section 168(g)(1)(F). Also, you are not entitled to  
the special depreciation allowance for that property. For a  
taxpayer with more than one qualifying business, the election is  
made with respect to each business.  
Question 26  
Check the “Yes” box if:  
1. On or after December 22, 2017, a foreign corporation  
directly or indirectly acquired substantially all of the properties  
held directly or indirectly by the corporation; and  
2. The ownership percentage with respect to the acquisition  
was greater than 50% (by vote or by value).  
If “Yes” is checked, also enter in the space provided the  
ownership percentage both by vote and by value. If there are  
multiple acquisitions that must be reported, enter the ownership  
for the most recent acquisition. Attach a statement reporting the  
ownership percentage by vote and by value for the other  
acquisitions.  
Section 7874 applies in certain cases in which a foreign  
corporation directly or indirectly acquires substantially all of the  
properties of a domestic corporation. Generally, it applies when  
three requirements are satisfied.  
1. Pursuant to a plan or series of related transactions, a  
foreign corporation must acquire directly or indirectly  
substantially all of the properties held directly or indirectly by a  
domestic corporation.  
Check “Yes” if the corporation has an election in effect to  
exclude a real property trade or business or a farming business  
from section 163(j). For more information, see the Instructions for  
Form 8990.  
Question 24  
2. After the acquisition, the ownership percentage (by vote  
or value) must be at least 60%.  
Generally, a taxpayer with a trade or business must file Form  
8990 to claim a deduction for business interest. In addition, Form  
8990 must be filed by any taxpayer that owns an interest in a  
partnership with current-year, or prior-year carryover, excess  
business interest expense allocated from the partnership.  
3. After the acquisition, the expanded affiliated group that  
includes the foreign acquiring corporation must not have  
substantial business activities in the foreign country in which the  
foreign acquiring corporation is created or organized.  
Exclusions from filing. A taxpayer is not required to file Form  
8990 if the taxpayer is a small business taxpayer (defined below)  
and does not have excess business interest expense from a  
partnership. A taxpayer also is not required to file Form 8990 if  
the taxpayer only has business interest expense from these  
excepted trades or businesses:  
When section 7874 applies, the tax treatment of the  
acquisition depends on the ownership percentage. If the  
ownership percentage is at least 80%, then the foreign acquiring  
corporation is treated as a domestic corporation for all purposes  
of the Internal Revenue Code. See section 7874(b). If the  
ownership percentage is at least 60% but less than 80%, then  
the foreign acquiring corporation is respected as a foreign  
corporation, but the domestic corporation and certain other  
persons are subject to special rules that reduce the tax benefits  
of the acquisition. See section 7874(a).  
An electing real property trade or business,  
An electing farming business, or  
Certain utility businesses.  
Small business taxpayer. A small business taxpayer is not  
subject to the business interest expense limitation and is not  
required to file Form 8990. A small business taxpayer is a  
taxpayer that (a) is not a tax shelter (as defined in section 448(d)  
(3)), and (b) meets the gross receipts test of section 448(c),  
discussed next.  
See the regulations under section 7874 for rules regarding  
the computation of the ownership percentage. See sections  
59A(d)(4), 965(l), 4501(d), and 4985 for additional rules  
regarding the tax treatment of certain expatriated entities.  
Question 27  
Gross receipts test. For 2023, a taxpayer meets the gross  
receipts test if the taxpayer has average annual gross receipts of  
$29 million or less for the 3 prior tax years. A taxpayer's average  
annual gross receipts for the 3 prior tax years is determined by  
adding the gross receipts for the 3 prior tax years and dividing  
the total by 3. Gross receipts include the aggregate gross  
receipts from all persons treated as a single employer, such as a  
controlled group of corporations, commonly controlled  
Digital assets are any digital representations of value that are  
recorded on a cryptographically secured distributed ledger or  
any similar technology. For example, digital assets include  
non-fungible tokens (NFTs) and virtual currencies, such as  
cryptocurrencies and stablecoins. If a particular asset has the  
characteristics of a digital asset, it will be treated as a digital  
asset for federal income tax purposes.  
25  
Instructions for Form 1120  
         
Check the “Yes” box if at any time during 2023 the corporation  
received (as a reward, award, or payment for property or  
services); or (b) sold, exchanged, or otherwise disposed of a  
digital asset (or any financial interest in any digital asset).  
the stock repurchase excise tax if, during the corporation's  
taxable year, (a) the corporation is publicly traded and  
repurchased its stock (or a specified affiliate of the corporation  
acquired the corporation's stock); (b) the corporation is a  
specified affiliate of an applicable foreign corporation; or (c) the  
corporation is an expatriated entity with respect to a covered  
surrogate foreign corporation.  
For example, check “Yes” if at any time during 2023 the  
corporation:  
Received digital assets as payment for property or services  
Do not complete a Form 7208 until the date specified in  
upcoming regulations under section 4501. For additional  
information, see section 4501 and Announcement 2023-18,  
2023-30 I.R.B. 366, available at IRS.gov/irb/  
provided;  
Received digital assets as a result of a reward or award;  
Received new digital assets as a result of mining, staking, and  
similar activities;  
Received digital assets as a result of a hard fork;  
Disposed of digital assets in exchange for property or  
Question 31  
services;  
Disposed of a digital asset in exchange or trade for another  
If the answer to question 31 is “Yes,attach a statement titled  
“Schedule K Statement of Subchapter K Basis Adjustments” that  
includes the information required for each tax basis adjustment  
described in (1) through (4) below. Provide the required  
information for each partnership where 80 % or more of the  
capital or profits of the partnership is owned, directly or indirectly,  
by members of the corporation's controlled group of corporations  
(as defined in section 1563). If there are unrelated third-party  
minority partner interests in the partnership, the corporation is  
not required to include such partners' information on this  
statement.  
digital asset;  
Sold a digital asset; or  
Otherwise disposed of any other financial interest in a digital  
asset.  
The corporation has a financial interest in a digital asset if it is  
the owner of record of a digital asset, or has an ownership stake  
in an account that holds one or more digital assets, including the  
rights and obligations to acquire a financial interest, or owns a  
wallet that holds digital assets.  
The following actions or transactions in 2023, alone, generally  
do not require the corporation to check “Yes:"  
1. If the adjusted basis of a partner's partnership interest  
differs from the partner's share of the partnership's adjusted  
basis of partnership property by $10 million or more at the end of  
the tax year and at any other relevant date (for example, at the  
time of a transfer of a partnership interest or the liquidation of a  
partnership) provide the partnership's name and TIN, partner's  
name and TIN, and the amount and allocation of such difference  
for each partner.  
Holding a digital asset in a wallet or account;  
Transferring a digital asset from one wallet or account the  
corporation owns or controls to another wallet or account that it  
owns or controls; or  
Purchasing digital assets using U.S. or other real currency,  
including through the use of electronic platforms such as PayPal  
and Venmo.  
2. If a partnership makes a basis adjustment of $10 million  
or more at the end of the tax year and at any other relevant date,  
pursuant to section 743 (including section 743(d)) upon the  
transfer of a partnership interest in such partnership to a partner  
that is, directly or indirectly, a controlled group member, provide  
the partnership's name and TIN, name and TIN of the transferor  
partner and transferee partner, and the amount and allocation of  
the basis adjustment.  
3. If a partnership makes a basis adjustment that is $10  
million or more at the end of the tax year and at any other  
relevant date made pursuant to section 734 (including section  
734(d)) upon the distribution of property to a controlled group  
member (directly or indirectly), provide the name and TIN of  
each partnership, the name and TIN of the controlled group  
member, and a schedule detailing the amount and allocation of  
the adjustment.  
4. If a partnership distributed property, directly or indirectly,  
to a controlled group member, and the controlled group  
member's basis in the property under section 732(a) or (b)  
differs from the partnership's basis in the property immediately  
before the distribution by $10 million or more at the end of the tax  
year and at any other relevant date, provide the partnership's  
name and TIN, the name and TIN of the controlled group  
member, and the amount and allocation of the basis adjustment.  
Do not leave the question unanswered. The corporation must  
answer "Yes" or “No” by checking the appropriate box. For more  
information, go to IRS.gov/virtualcurrencyfaqs.  
If the corporation disposed of any digital asset which was  
held as a capital asset, through a sale, trade, exchange,  
payment, or other transfer, use Form 8949 to calculate the  
capital gain or loss and report that gain or loss on Schedule D  
(Form 1120). If the corporation received any digital asset as  
compensation for services or disposed of any digital asset that  
was held for sale to customers in a trade or business, it must  
report the income as it would report other income of the same  
type.  
Question 28  
If the corporation is a member of a controlled group, check the  
"Yes" box. Complete and attach Schedule O (Form 1120),  
Consent Plan and Apportionment Schedule for a Controlled  
Group. Component members of a controlled group must use  
Schedule O to report the apportionment of certain tax benefits  
between the members of the group. See Schedule O and the  
Instructions for Schedule O for more information.  
Question 29  
Check the appropriate boxes to indicate if the corporation is  
required to file Form 4626. If the corporation does not meet the  
requirements of the safe harbor method, as provided under  
section 59(k)(3)(A) and Notice 2023-7, 2023-3 I.R.B. 390,  
available at IRS.gov/irb/2023-03_IRB#NOT-2023-7, for the  
current year, Form 4626 must be completed and attached to the  
corporation's return. See the instructions for Form 4626.  
Schedule L.  
Balance Sheets per Books  
The balance sheets should agree with the corporation's books  
and records.  
Corporations with total receipts (page 1, line 1a plus lines 4  
through 10) and total assets at the end of the tax year less than  
$250,000 are not required to complete Schedules L, M-1, and  
M-2 if the “Yes” box on Schedule K, question 13, is checked.  
Question 30  
Under section 4501, the corporation may be required to file Form  
7208, Excise Tax on Repurchase of Corporate Stock, and pay  
26  
Instructions for Form 1120  
     
Corporations with total assets nonconsolidated (or  
consolidated for all corporations included within the consolidated  
tax group) of $10 million or more on the last day of the tax year  
must file Schedule M-3 (Form 1120) instead of Schedule M-1.  
However, see the instructions for Schedule M-1 below. See the  
separate Instructions for Schedule M-3 (Form 1120) for  
provisions that also affect Schedule L.  
If filing a consolidated return, report total consolidated assets,  
liabilities, and shareholder's equity for all corporations joining in  
the return. See Consolidated Return, earlier.  
complete Schedule M-1 instead of completing Parts II and III of  
Schedule M-3, the amount on Schedule M-1, line 1, must equal  
the amount on Schedule M-3, Part I, line 11. See the Instructions  
for Schedule M-3 (Form 1120) for more information.  
Line 5c  
Include any of the following applicable expenses.  
Entertainment expenses not deductible under section 274(a).  
Meal expenses not deductible under section 274(n).  
Qualified transportation fringes not deductible under section  
274(a)(4).  
Expenses for the use of an entertainment facility.  
Line 1  
The part of business gifts over $25.  
Include certificates of deposit as cash on this line.  
Expenses of an individual over $2,000, allocable to  
conventions on cruise ships.  
Line 5  
Employee achievement awards of nontangible or tangible  
Include on this line:  
property over $400 ($1,600 if part of a qualified plan).  
State and local government obligations, the interest on which  
The cost of skyboxes.  
is excludable from gross income under section 103(a), and  
Nondeductible club dues.  
Stock in a mutual fund or other RIC that distributed  
The part of luxury water travel expenses not deductible under  
exempt-interest dividends during the tax year of the corporation.  
section 274(m).  
Expenses for travel as a form of education.  
Line 26  
Other nondeductible travel and entertainment expenses.  
Some examples of adjustments to report on this line include:  
Unrealized gains and losses on securities held “available for  
Line 7  
sale,”  
Report any tax-exempt interest received or accrued, including  
any exempt-interest dividends received as a shareholder in a  
mutual fund or other RIC. Also, report this same amount on  
Schedule K, item 9.  
Foreign currency translation adjustments,  
The excess of additional pension liability over unrecognized  
prior service cost,  
Guarantees of employee stock (ESOP) debt, and  
Compensation related to employee stock award plans.  
The corporation should include tax-exempt income from  
forgiven PPP loans on line 7 of Schedule M-1 (if it was included  
on line 1 of the Schedule M-1), or on Part II, line 25 of  
Schedule M-3 (Form 1120), column (c) as a negative number (if  
it was included on line 25 in column (a) as Income per Income  
Statement).  
If the total adjustment to be entered on line 26 is a negative  
amount, enter the amount in parentheses.  
Schedule M-1. Reconciliation of  
Income (Loss) per Books With  
Schedule M-2. Analysis of  
Unappropriated Retained Earnings  
per Books  
Income per Return  
In completing Schedule M-1, the following apply.  
Corporations with total receipts (page 1, line 1a plus lines 4  
through 10) and total assets at the end of the tax year less than  
$250,000 are not required to complete Schedules L, M-1, and  
M-2 if the “Yes” box on Schedule K, question 13, is checked.  
If the corporation treats tax-exempt income resulting from a PPP  
loan as received or accrued prior to when forgiveness of the PPP  
loan is granted and the amount of forgiveness granted is less  
than the amount of tax-exempt income that was previously  
treated as received or accrued, the corporation should include  
the difference as a decrease in tax-exempt income on  
Schedule M-2, line 6, for the tax year in which the taxpayer  
receives notice that the PPP loan was not fully forgiven. The  
corporation should attach a statement to Schedule M-2 including  
the following information:  
Corporations with total assets non-consolidated (or  
consolidated for all corporations included within the consolidated  
tax group) of $10 million or more on the last day of the tax year  
must file Schedule M-3 (Form 1120) instead of Schedule M-1.  
A corporation filing Form 1120 that is not required to file  
Schedule M-3 may voluntarily file Schedule M-3 instead of  
Schedule M-1. See the Instructions for Schedule M-3 (Form  
1120) for more information.  
Corporations that (a) are required to file Schedule M-3 (Form  
1. The corporation's name, address, and EIN;  
1120) and have less than $50 million total assets at the end of  
the tax year, or (b) are not required to file Schedule M-3 (Form  
1120) and voluntarily file Schedule M-3 (Form 1120), must either  
(i) complete Schedule M-3 (Form 1120) entirely, or (ii) complete  
Schedule M-3 (Form 1120) through Part I, and complete Form  
1120, Schedule M-1, instead of completing Parts II and III of  
Schedule M-3 (Form 1120). If the corporation chooses to  
2. A statement that the corporation is making adjustments in  
accordance with section 3.03 of Rev. Proc. 2021-48; and  
3. The tax year for which tax-exempt income was originally  
reported, the amount of tax-exempt income that was originally  
reported for such tax year, and the amount of tax-exempt income  
being adjusted on Schedule M-2.  
27  
Instructions for Form 1120  
             
Paperwork Reduction Act Notice. We ask for the information on these forms to carry out the Internal Revenue laws of the United  
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figure and collect the right amount of tax.  
You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form  
displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents  
may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential,  
as required by section 6103.  
Estimates of Taxpayer Burden. The following tables show burden estimates based on current statutory requirements as of  
December 2023 for taxpayers filing 2023 Forms 1065, 1120, 1120-C, 1120-F, 1120-H, 1120-ND, 1120-S, 1120-SF, 1120-FSC, 1120-L,  
1120-PC, 1066, 1120-REIT, 1120-RIC, 1120-POL, and related attachments. Time spent and out-of-pocket costs are presented  
separately. Time burden is broken out by taxpayer activity, with reporting representing the largest component. Out-of-pocket costs  
include any expenses incurred by taxpayers to prepare and submit their tax returns. Examples include tax return preparation and  
submission fees, postage and photocopying costs, and tax preparation software costs. While these estimates don't include burden  
associated with post-filing activities, IRS operational data indicate that electronically prepared and filed returns have fewer arithmetic  
errors, implying lower post-filing burden.  
Reported time and cost burdens are national averages and don't necessarily reflect a “typical” case. Most taxpayers experience  
lower than average burden, with taxpayer burden varying considerably by taxpayer type.  
The average burden for partnerships filing Forms 1065 and related attachments is about 60 hours and $5,000; the average burden  
for corporations filing Form 1120 and associated forms is about 105 hours and $6,700; and the average burden for Forms 1066,  
1120-REIT, 1120-RIC, 1120S, and all related attachments is 65 hours and $4,400. Within each of these estimates there is significant  
variation in taxpayer activity. Tax preparation fees and other out-of-pocket costs vary extensively depending on the tax situation of the  
taxpayer, the type of software or professional preparer used, and the geographic location. Third-party burden hours are not included in  
these estimates.  
Table 1 – Taxpayer Burden for Entities Taxed as Partnerships  
Forms 1065, 1066, and all attachments  
Primary Form Filed or Type of  
Taxpayer  
Total Number of Returns  
(millions)  
Average Time (hours)  
Average Cost ($)  
Average Monetized  
Burden ($)  
All Partnerships  
Small  
5.3  
4.9  
0.4  
60  
50  
200  
5,000  
3,200  
27,800  
8,700  
5,200  
50,800  
Large*  
*A large business is defined as one having end-of-year assets greater than $10 million. A large business is defined the same way for partnerships, taxable corporations, and  
pass-through corporations. A small business is any business that doesn't meet the definition of a large business.  
Table 2 – Taxpayer Burden for Entities Taxed as Taxable Corporations  
Forms 1120, 1120-C, 1120-F, 1120-H, 1120-ND, 1120-SF, 1120-FSC, 1120-L, 1120-PC, 1120-POL, and all attachments  
Primary Form Filed or Type of  
Taxpayer  
Total Number of Returns  
(millions)  
Average Time (hours)  
Average Cost ($)  
Average Monetized  
Burden ($)  
All Taxable Corporations  
2.1  
2.0  
0.1  
105  
55  
830  
6,700  
3,600  
53,800  
14,900  
6,200  
149,000  
Small  
Large*  
*A large business is defined as one having end-of-year assets greater than $10 million. A large business is defined the same way for partnerships, taxable corporations, and  
pass-through corporations. A small business is any business that doesn't meet the definition of a large business.  
Table 3 – Taxpayer Burden for Entities Taxed as Pass-Through Corporations  
Forms 1120-REIT, 1120-RIC, 1120-S, and all attachments  
Primary Form Filed or Type of  
Taxpayer  
Total Number of Returns  
(millions)  
Average Time (hours)  
Average Cost ($)  
Average Monetized  
Burden ($)  
All Pass-Through Corporations  
5.8  
5.7  
0.1  
65  
60  
295  
4,400  
3,800  
37,700  
7,500  
6,400  
71,800  
Small  
Large*  
*A large business is defined as one having end-of-year assets greater than $10 million. A large business is defined the same way for partnerships, taxable corporations, and  
pass-through corporations. A small business is any business that doesn't meet the definition of a large business.  
Comments. If you have comments concerning the accuracy of these time estimates or suggestions for making these forms simpler,  
we would be happy to hear from you. You can send us comments through IRS.gov/FormComments. Or you can write to the Internal  
Revenue Service, Tax Forms and Publications, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send the tax form  
to this address. Instead, see Where To File, earlier, near the beginning of the instructions.  
28  
Instructions for Form 1120  
Using the list of activities and codes below,  
considered a manufacturer and must use one of the  
manufacturing codes (311110–339900).  
Principal Business Activity Codes  
determine from which activity the company derives the  
largest percentage of its “total receipts.” Total receipts is  
defined as the sum of gross receipts or sales (page 1,  
line 1a) plus all other income (page 1, lines 4 through  
10). If the company purchases raw materials and  
supplies them to a subcontractor to produce the finished  
product, but retains title to the product, the company is  
This list of principal business activities and their  
associated codes is designed to classify an enterprise  
by the type of activity in which it is engaged to facilitate  
the administration of the Internal Revenue Code. These  
principal business activity codes are based on the North  
American Industry Classification System.  
Once the principal business activity is determined,  
entries must be made on Form 1120, Schedule K, lines  
2a, 2b, and 2c. On line 2a, enter the six-digit code  
selected from the list below. On line 2b, enter the  
company's business activity. On line 2c, enter a brief  
description of the principal product or service of the  
company.  
238290 Other Building Equipment  
Contractors  
238300 Building Finishing Contractors  
(including drywall, insulation,  
painting, wallcovering, flooring,  
tile, & finished carpentry)  
238900 Other Specialty Trade  
Contractors (including site  
preparation)  
Plastics and Rubber Products  
Manufacturing  
Furniture and Related Product  
Manufacturing  
Agriculture, Forestry, Fishing,  
326100 Plastics Product Mfg  
326200 Rubber Product Mfg  
337000 Furniture & Related Product  
and Hunting  
Manufacturing  
Crop Production  
Miscellaneous Manufacturing  
Nonmetallic Mineral Product  
111100 Oilseed & Grain Farming  
Manufacturing  
339110 Medical Equipment & Supplies  
111210 Vegetable & Melon Farming  
Mfg  
327100 Clay Product & Refractory Mfg  
327210 Glass & Glass Product Mfg  
327300 Cement & Concrete Product Mfg  
327400 Lime & Gypsum Product Mfg  
(including potatoes & yams)  
339900 Other Miscellaneous  
111300 Fruit & Tree Nut Farming  
Manufacturing  
111400 Greenhouse, Nursery, &  
Manufacturing  
Food Manufacturing  
Wholesale Trade  
Floriculture Production  
327900 Other Nonmetallic Mineral  
111900 Other Crop Farming (including  
tobacco, cotton, sugarcane, hay,  
peanut, sugar beet, & all other  
crop farming)  
Merchant Wholesalers, Durable Goods  
311110 Animal Food Mfg  
311200 Grain & Oilseed Milling  
Product Mfg  
423100 Motor Vehicle & Motor Vehicle  
Primary Metal Manufacturing  
Parts & Supplies  
311300 Sugar & Confectionery Product  
331110 Iron & Steel Mills & Ferroalloy  
423200 Furniture & Home Furnishings  
Animal Production  
Mfg  
Mfg  
423300 Lumber & Other Construction  
112111 Beef Cattle Ranching & Farming  
112112 Cattle Feedlots  
311400 Fruit & Vegetable Preserving &  
Specialty Food Mfg  
331200 Steel Product Mfg from  
Purchased Steel  
Materials  
423400 Professional & Commercial  
Equipment & Supplies  
311500 Dairy Product Mfg  
331310 Alumina & Aluminum Production  
112120 Dairy Cattle & Milk Production  
112210 Hog & Pig Farming  
& Processing  
311610 Animal Slaughtering &  
423500 Metal & Mineral (except  
Processing  
331400 Nonferrous Metal (except  
Aluminum) Production &  
Processing  
Petroleum)  
112300 Poultry & Egg Production  
112400 Sheep & Goat Farming  
311710 Seafood Product Preparation &  
Packaging  
423600 Household Appliances &  
Electrical & Electronic Goods  
112510 Aquaculture (including shellfish &  
331500 Foundries  
311800 Bakeries, Tortilla & Dry Pasta Mfg  
423700 Hardware, Plumbing, & Heating  
finfish farms & hatcheries)  
Fabricated Metal Product  
311900 Other Food Mfg (including  
coffee, tea, flavorings &  
seasonings)  
Equipment & Supplies  
112900 Other Animal Production  
Forestry and Logging  
Manufacturing  
423800 Machinery, Equipment, &  
Supplies  
332110 Forging & Stamping  
113110 Timber Tract Operations  
Beverage and Tobacco Product  
332210 Cutlery & Handtool Mfg  
423910 Sporting & Recreational Goods &  
Manufacturing  
113210 Forest Nurseries & Gathering of  
Supplies  
332300 Architectural & Structural Metals  
Forest Products  
312110 Soft Drink & Ice Mfg  
312120 Breweries  
Mfg  
423920 Toy & Hobby Goods & Supplies  
423930 Recyclable Materials  
113310 Logging  
332400 Boiler, Tank, & Shipping  
Container Mfg  
Fishing, Hunting, and Trapping  
114110 Fishing  
312130 Wineries  
312140 Distilleries  
423940 Jewelry, Watch, Precious Stone,  
332510 Hardware Mfg  
& Precious Metals  
114210 Hunting & Trapping  
332610 Spring & Wire Product Mfg  
312200 Tobacco Manufacturing  
Textile Mills and Textile Product Mills  
313000 Textile Mills  
423990 Other Miscellaneous Durable  
Goods  
Support Activities for Agriculture and  
332700 Machine Shops; Turned Product;  
Forestry  
& Screw, Nut, & Bolt Mfg  
Merchant Wholesalers, Nondurable  
Goods  
115110 Support Activities for Crop  
Production (including cotton  
ginning, soil preparation,  
332810 Coating, Engraving, Heat  
Treating, & Allied Activities  
314000 Textile Product Mills  
Apparel Manufacturing  
424100 Paper & Paper Products  
332900 Other Fabricated Metal Product  
424210 Drugs & Druggists' Sundries  
424300 Apparel, Piece Goods, & Notions  
424400 Grocery & Related Products  
424500 Farm Product Raw Materials  
424600 Chemical & Allied Products  
424700 Petroleum & Petroleum Products  
planting, & cultivating)  
315100 Apparel Knitting Mills  
315210 Cut & Sew Apparel Contractors  
Mfg  
115210 Support Activities for Animal  
Machinery Manufacturing  
Production (including farriers)  
315250 Cut & Sew Apparel Mfg (except  
333100 Agriculture, Construction, &  
115310 Support Activities for Forestry  
Contractors)  
Mining Machinery Mfg  
315990 Apparel Accessories & Other  
Apparel Mfg  
333200 Industrial Machinery Mfg  
Mining  
333310 Commercial & Service Industry  
211120 Crude Petroleum Extraction  
211130 Natural Gas Extraction  
212110 Coal Mining  
Leather and Allied Product  
424800 Beer, Wine, & Distilled Alcoholic  
Machinery Mfg  
Manufacturing  
Beverages  
333410 Ventilation, Heating,  
Air-Conditioning, & Commercial  
Refrigeration Equipment Mfg  
316110 Leather & Hide Tanning &  
Finishing  
424910 Farm Supplies  
212200 Metal Ore Mining  
212310 Stone Mining & Quarrying  
424920 Book, Periodical, & Newspapers  
316210 Footwear Mfg (including rubber &  
333510 Metalworking Machinery Mfg  
424930 Flower, Nursery Stock, & Florists'  
plastics)  
Supplies  
333610 Engine, Turbine & Power  
212320 Sand, Gravel, Clay, & Ceramic &  
Refractory Minerals Mining &  
Quarrying  
316990 Other Leather & Allied Product  
Mfg  
Transmission Equipment Mfg  
424940 Tobacco Products & Electronic  
Cigarettes  
333900 Other General Purpose  
Machinery Mfg  
Wood Product Manufacturing  
212390 Other Nonmetallic Mineral  
424950 Paint, Varnish, & Supplies  
Mining & Quarrying  
321110 Sawmills & Wood Preservation  
Computer and Electronic Product  
424990 Other Miscellaneous Nondurable  
Manufacturing  
213110 Support Activities for Mining  
321210 Veneer, Plywood, & Engineered  
Goods  
Wood Product Mfg  
334110 Computer & Peripheral  
Equipment Mfg  
Wholesale Trade Agents and Brokers  
Utilities  
321900 Other Wood Product Mfg  
Paper Manufacturing  
425120 Wholesale Trade Agents &  
334200 Communications Equipment Mfg  
334310 Audio & Video Equipment Mfg  
221100 Electric Power Generation,  
Brokers  
Transmission & Distribution  
322100 Pulp, Paper, & Paperboard Mills  
322200 Converted Paper Product Mfg  
Printing and Related Support Activities  
Retail Trade  
Motor Vehicle and Parts Dealers  
441110 New Car Dealers  
221210 Natural Gas Distribution  
334410 Semiconductor & Other  
Electronic Component Mfg  
221300 Water, Sewage & Other Systems  
221500 Combination Gas & Electric  
334500 Navigational, Measuring,  
Electromedical, & Control  
Instruments Mfg  
323100 Printing & Related Support  
441120 Used Car Dealers  
441210 Recreational Vehicle Dealers  
441222 Boat Dealers  
Activities  
Construction  
Petroleum and Coal Products  
Manufacturing  
334610 Manufacturing & Reproducing  
Construction of Buildings  
Magnetic & Optical Media  
236110 Residential Building Construction  
324110 Petroleum Refineries (including  
441227 Motorcycle, ATV, & All Other  
Electrical Equipment, Appliance, and  
Component Manufacturing  
integrated)  
236200 Nonresidential Building  
Motor Vehicle Dealers  
Construction  
324120 Asphalt Paving, Roofing, &  
Saturated Materials Mfg  
441300 Automotive Parts, Accessories, &  
Tire Retailers  
335100 Electric Lighting Equipment Mfg  
335200 Household Appliance Mfg  
335310 Electrical Equipment Mfg  
Heavy and Civil Engineering  
Construction  
324190 Other Petroleum & Coal Products  
Furniture and Home Furnishings  
Mfg  
237100 Utility System Construction  
237210 Land Subdivision  
Retailers  
335900 Other Electrical Equipment &  
Chemical Manufacturing  
449110 Furniture Retailers  
Component Mfg  
325100 Basic Chemical Mfg  
237310 Highway, Street, & Bridge  
449121 Floor Covering Retailers  
449122 Window Treatment Retailers  
Transportation Equipment  
Manufacturing  
Construction  
325200 Resin, Synthetic Rubber, &  
Artificial & Synthetic Fibers &  
Filaments Mfg  
237990 Other Heavy & Civil Engineering  
Construction  
449129 All Other Home Furnishings  
336100 Motor Vehicle Mfg  
Retailers  
336210 Motor Vehicle Body & Trailer Mfg  
336300 Motor Vehicle Parts Mfg  
336410 Aerospace Product & Parts Mfg  
336510 Railroad Rolling Stock Mfg  
336610 Ship & Boat Building  
325300 Pesticide, Fertilizer, & Other  
Specialty Trade Contractors  
Electronics and Appliance Retailers  
Agricultural Chemical Mfg  
238100 Foundation, Structure, & Building  
Exterior Contractors (including  
framing carpentry, masonry,  
449210 Electronics & Appliance Retailers  
325410 Pharmaceutical & Medicine Mfg  
325500 Paint, Coating, & Adhesive Mfg  
(including Computers)  
Building Material and Garden  
glass, roofing, & siding)  
325600 Soap, Cleaning Compound, &  
Equipment and Supplies Dealers  
238210 Electrical Contractors  
Toilet Preparation Mfg  
336990 Other Transportation Equipment  
444110 Home Centers  
238220 Plumbing, Heating, &  
325900 Other Chemical Product &  
Preparation Mfg  
Mfg  
444120 Paint & Wallpaper Retailers  
444140 Hardware Retailers  
Air-Conditioning Contractors  
29  
 
Principal Business Activity Codes (Continued)  
444180 Other Building Material Dealers  
485410 School & Employee Bus  
523210 Securities & Commodity  
Exchanges  
541380 Testing Laboratories & Services  
Transportation  
444200 Lawn & Garden Equipment &  
Specialized Design Services  
Supplies Retailers  
485510 Charter Bus Industry  
523900 Other Financial Investment  
Activities (including portfolio  
management & investment  
advice)  
541400 Specialized Design Services  
Food and Beverage Retailers  
485990 Other Transit & Ground  
(including interior, industrial,  
Passenger Transportation  
graphic, & fashion design)  
445110 Supermarkets & Other Grocery  
Retailers (except Convenience)  
Pipeline Transportation  
Computer Systems Design and Related  
Insurance Carriers and Related  
Services  
445131 Convenience Retailers  
445132 Vending Machine Operators  
445230 Fruit & Vegetable Retailers  
445240 Meat Retailers  
486000 Pipeline Transportation  
Scenic & Sightseeing Transportation  
Activities  
541511 Custom Computer Programming  
Services  
524110 Direct Life, Health, & Medical  
Insurance Carriers  
487000 Scenic & Sightseeing  
541512 Computer Systems Design  
Transportation  
524120 Direct Insurance (except Life,  
Services  
Support Activities for Transportation  
Health, & Medical) Carriers  
445250 Fish & Seafood Retailers  
445291 Baked Goods Retailers  
445292 Confectionery & Nut Retailers  
541513 Computer Facilities Management  
Services  
488100 Support Activities for Air  
524210 Insurance Agencies &  
Brokerages  
Transportation  
541519 Other Computer Related  
488210 Support Activities for Rail  
Transportation  
524290 Other Insurance Related  
Activities (including third-party  
administration of insurance &  
pension funds)  
Services  
445298 All Other Specialty Food  
Retailers  
Other Professional, Scientific, and  
Technical Services  
488300 Support Activities for Water  
445320 Beer, Wine, & Liquor Retailers  
Health and Personal Care Retailers  
456110 Pharmacies & Drug Retailers  
Transportation  
541600 Management, Scientific, &  
Funds, Trusts, and Other Financial  
488410 Motor Vehicle Towing  
Technical Consulting Services  
Vehicles  
488490 Other Support Activities for Road  
541700 Scientific Research &  
Development Services  
525100 Insurance & Employee Benefit  
Funds  
456120 Cosmetics, Beauty Supplies, &  
Transportation  
Perfume Retailers  
488510 Freight Transportation  
Arrangement  
541800 Advertising, Public Relations, &  
525910 Open-End Investment Funds  
456130 Optical Goods Retailers  
Related Services  
(Form 1120-RIC)  
456190 Other Health & Personal Care  
488990 Other Support Activities for  
541910 Marketing Research & Public  
Opinion Polling  
525920 Trusts, Estates, & Agency  
Accounts  
Retailers  
Transportation  
Gasoline Stations & Fuel Dealers  
Couriers and Messengers  
541920 Photographic Services  
525990 Other Financial Vehicles  
(including mortgage REITs &  
closed-end investment funds)  
457100 Gasoline Stations (including  
492110 Couriers & Express Delivery  
541930 Translation & Interpretation  
convenience stores with gas)  
Services  
Services  
457210 Fuel Dealers (including Heating  
Oil & Liquefied Petroleum)  
492210 Local Messengers & Local  
Delivery  
541940 Veterinary Services  
Real Estate and Rental and  
Leasing  
Real Estate  
541990 All Other Professional, Scientific,  
Clothing and Accessories Retailers  
Warehousing and Storage  
& Technical Services  
458110 Clothing & Clothing Accessories  
493100 Warehousing & Storage (except  
lessors of miniwarehouses &  
self-storage units)  
Management of Companies  
(Holding Companies)  
Retailers  
531110 Lessors of Residential Buildings  
& Dwellings (including equity  
REITs)  
458210 Shoe Retailers  
458310 Jewelry Retailers  
Information  
551111 Offices of Bank Holding  
458320 Luggage & Leather Goods  
Companies  
531120 Lessors of Nonresidential  
Motion Picture and Sound Recording  
Retailers  
Buildings (except  
Industries  
551112 Offices of Other Holding  
Companies  
Sporting Goods, Hobby, Book, Musical  
Instrument and Miscellaneous Retailers  
Miniwarehouses) (including  
equity REITs)  
512100 Motion Picture & Video Industries  
(except video rental)  
459110 Sporting Goods Retailers  
Administrative and Support and  
Waste Management and  
Remediation Services  
Administrative and Support Services  
561110 Office Administrative Services  
561210 Facilities Support Services  
561300 Employment Services  
561410 Document Preparation Services  
561420 Telephone Call Centers  
561430 Business Service Centers  
(including private mail centers &  
copy shops)  
561440 Collection Agencies  
561450 Credit Bureaus  
531130 Lessors of Miniwarehouses &  
Self-Storage Units (including  
equity REITs)  
512200 Sound Recording Industries  
Publishing Industries  
459120 Hobby, Toy, & Game Retailers  
459130 Sewing, Needlework, & Piece  
513110 Newspaper Publishers  
513120 Periodical Publishers  
513130 Book Publishers  
531190 Lessors of Other Real Estate  
Goods Retailers  
Property (including equity REITs)  
459140 Musical Instrument & Supplies  
Retailers  
531210 Offices of Real Estate Agents &  
Brokers  
513140 Directory & Mailing List  
459210 Book Retailers & News Dealers  
531310 Real Estate Property Managers  
531320 Offices of Real Estate Appraisers  
Publishers  
(including newsstands)  
513190 Other Publishers  
459310 Florists  
531390 Other Activities Related to Real  
513210 Software Publishers  
459410 Office Supplies & Stationery  
Estate  
Retailers  
Broadcasting, Content Providers, and  
Rental and Leasing Services  
Telecommunications  
459420 Gift, Novelty, & Souvenir  
Retailers  
532100 Automotive Equipment Rental &  
516100 Radio & Television Broadcasting  
Stations  
Leasing  
459510 Used Merchandise Retailers  
459910 Pet & Pet Supplies Retailers  
459920 Art Dealers  
532210 Consumer Electronics &  
Appliances Rental  
516210 Media Streaming, Social  
Networks, & Other Content  
Providers  
532281 Formal Wear & Costume Rental  
532282 Video Tape & Disc Rental  
532283 Home Health Equipment Rental  
532284 Recreational Goods Rental  
561490 Other Business Support  
Services (including repossession  
services, court reporting, &  
stenotype services)  
459930 Manufactured (Mobile) Home  
517000 Telecommunications (including  
Wired, Wireless, Satellite, Cable  
& Other Program Distribution,  
Resellers, Agents, Other  
Dealers  
459990 All Other Miscellaneous Retailers  
(including tobacco, candle, &  
trophy retailers)  
561500 Travel Arrangement &  
Telecommunications, & Internet  
Service Providers)  
532289 All Other Consumer Goods  
Reservation Services  
General Merchandise Retailers  
455110 Department Stores  
Rental  
561600 Investigation & Security Services  
Data Processing, Web Search Portals, &  
532310 General Rental Centers  
561710 Exterminating & Pest Control  
Other Information Services  
455210 Warehouse Clubs, Supercenters,  
532400 Commercial & Industrial  
Machinery & Equipment Rental &  
Leasing  
Services  
& Other General Merch. Retailers 518210 Computing Infrastructure  
Providers, Data Processing, Web