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Форма 1120-Ф Інструкція по графіку S

Інструкція по графіку S (Форм 1120-F) , Виключення доходів від міжнародної операції суден або літака під розділ 883

2022 р

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  • Форма 1120-F Графік S - Виключення доходів від міжнародної операції суден або літаків під розділ 883
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Department of the Treasury  
Internal Revenue Service  
Instructions for Schedule S  
(Form 1120-F)  
(Rev. December 2022)  
Exclusion of Income From the International Operation of Ships or Aircraft Under  
Section 883  
Section references are to the Internal Revenue  
Code unless otherwise noted.  
A qualified foreign corporation is a  
corporation as defined in section 7701(a)  
(3) that is organized in a qualified foreign  
country and considered engaged in the  
international operation of ships or aircraft.  
Furthermore, to be a qualified foreign  
corporation, the corporation must satisfy  
one of the stock ownership tests  
The term international operation of  
ships or aircraft means the operation of  
ships or aircraft (as defined above) with  
respect to the carriage of passengers or  
cargo on voyages or flights that begin or  
end in the United States, as determined in  
Regulations section 1.883-1(f)(2). The  
term does not include the carriage of  
passengers or cargo on a voyage or flight  
that begins and ends in the United States,  
even if the voyage or flight contains a  
segment extending beyond the territorial  
limits of the United States, unless the  
passenger disembarks or the cargo is  
unloaded outside the United States.  
Operation of ships or aircraft beyond the  
territorial limits of the United States does  
not constitute in itself international  
Future Developments  
For the latest information about  
developments related to Schedule S  
(Form 1120-F) and its instructions, such  
as legislation enacted after they were  
published, go to IRS.gov/Form1120F.  
described below in the instructions for  
Parts II, III, and IV. See also Regulations  
section 1.883-1(c)(3)(ii).  
General Instructions  
Note. A corporation may be a qualified  
foreign corporation with respect to one  
category of qualified income but not with  
respect to another such category.  
Purpose of Schedule  
Schedule S (Form 1120-F) is used by  
foreign corporations to claim an exclusion  
from gross income under section 883 and  
to provide reporting information required  
by the section 883 regulations.  
A foreign corporation is considered  
engaged in the operation of ships or  
aircraft only during the time it is an owner  
or lessee of one or more entire ships or  
aircraft and uses such ships or aircraft in  
one or more of the following activities:  
operation of ships or aircraft.  
Equivalent exemption. A foreign  
country grants an equivalent exemption  
when it exempts from taxation income  
from the international operation of ships or  
aircraft derived by corporations organized  
in the United States. Whether a foreign  
country provides an equivalent exemption  
must be determined separately with  
respect to each category of income listed  
on lines 2a through 2h of the schedule.  
See Regulations section 1.883-1(h)(2) for  
rules for determining equivalent  
Who Must File  
Qualified foreign corporations engaged in  
the international operation of ships or  
aircraft that are claiming an exclusion of  
gross income under section 883 must  
complete Schedule S (Form 1120-F). See  
Definitions below.  
Carriage of passengers or cargo for  
hire;  
In the case of a ship, the leasing out of  
the ship under a time or voyage charter  
(full charter), space or slot charter, or  
bareboat charter (as those terms are  
defined in Regulations section 1.883-1(e)  
(5)), provided the ship is used to carry  
passengers or cargo for hire; and  
When and Where To File  
Attach Schedule S (Form 1120-F) to the  
foreign corporation's Form 1120-F income  
tax return. See the Instructions for Form  
1120-F for the time, place, and manner for  
filing the corporation's income tax return.  
In the case of aircraft, the leasing out of  
exemptions for each category of income.  
the aircraft under a wet lease (full charter),  
space, slot, or block-seat charter, or dry  
lease (as those terms are defined in  
Regulations section 1.883-1(e)(5)),  
provided the aircraft is used to carry  
passengers or cargo for hire. See  
Regulations sections 1.883-1(e)(1) and (2)  
for additional information.  
An equivalent exemption may be  
available for income derived from the  
international operation of ships even  
though income derived from the  
Definitions  
international operation of aircraft may not  
be exempt, and vice versa. For rules  
regarding foreign corporations organized  
in countries that provide exemptions  
through an income tax convention, see  
Regulations section 1.883-1(h)(3).  
Qualified income is income derived from  
the international operation of ships or  
aircraft that is (a) properly includible in any  
of the income categories described on  
lines 2a through 2h of the schedule, and  
(b) the subject of an equivalent exemption  
(defined below) granted by the qualified  
foreign country (defined below) in which  
the corporation is organized.  
Activities that do not constitute  
operation of ships or aircraft include, but  
are not limited to:  
An equivalent exemption may exist  
where the foreign country:  
The activities of a non-vessel operating  
common carrier,  
Generally imposes no tax on income,  
Ship or aircraft management,  
including income from the international  
operation of ships or aircraft;  
A qualified foreign country is a  
foreign country or U.S. possession that  
grants to corporations organized in the  
United States an equivalent exemption  
(defined below) for the category of  
Obtaining crews for ships or aircraft  
operated by another party,  
Specifically provides a domestic law tax  
Acting as a ship's agent,  
Ship or aircraft brokering,  
Freight forwarding,  
exemption for income derived from the  
international operation of ships or aircraft,  
either by statute, decree, income tax  
convention, or otherwise; or  
qualified income, derived by the foreign  
corporation seeking qualified foreign  
corporation status. A foreign country may  
be a qualified foreign country with respect  
to one category of qualified income but not  
with respect to another such category.  
The activities of travel agents and tour  
operators,  
Exchanges diplomatic notes with the  
Rental by a container leasing company  
United States, or enters into an agreement  
with the United States, that provides for a  
reciprocal exemption for purposes of  
section 883.  
of containers and related equipment, and  
The activities of a concessionaire.  
Dec 10, 2022  
Cat. No. 51665B  
Certain types of exemptions provided  
to corporations organized in the United  
States by foreign countries do not satisfy  
the equivalent exemption requirements of  
Regulations section 1.883-1(h). Examples  
of types of exemptions that do not qualify  
as equivalent exemptions include:  
derived from the activities (specified on  
these lines) that are incidental to the  
international operation of ships or aircraft  
(as defined in Regulations section  
shares outstanding in that class during the  
tax year multiplied by the number of days  
in the short tax year, divided by 365).  
A class of stock that is traded during  
the tax year on an established securities  
market located in the United States shall  
be considered to meet the trading  
requirement described above under  
Regularly traded if the stock is regularly  
quoted by dealers making a market in the  
stock.  
1.883-1(g)(1)). For types of activities that  
are not considered incidental to the  
international operation of ships or aircraft,  
see Regulations section 1.883-1(g)(2).  
Reduced tax rate or time limited  
exemption,  
Inbound or outbound freight tax,  
Exemptions for limited types of cargo,  
Territorial tax systems,  
Part II—Stock Ownership  
Test for Publicly-Traded  
Corporations  
Countries that tax U.S. corporations  
A dealer makes a market in a stock  
only if the dealer regularly and actively  
offers to, and in fact does, purchase the  
stock from, and sell the stock to,  
that are not managed and controlled in  
that country on a residence basis, and  
A foreign corporation satisfies the stock  
ownership test of Regulations section  
1.883-1(c)(2) if it is considered a  
Exemptions within categories of  
income.  
publicly-traded corporation and satisfies  
the substantiation and reporting  
customers who are not related persons  
(as defined in section 954(d)(3)) with  
respect to the dealer in the ordinary  
course of a trade or business.  
See Regulations section 1.883-1(h)(4)  
requirements of Regulations sections  
1.883-2(e) and (f). To be considered a  
publicly-traded corporation, the stock of  
the foreign corporation must be primarily  
and regularly traded (as defined below) on  
one or more established securities  
markets (as defined in Regulations section  
1.883-2(b)) in either the United States or  
any qualified foreign country.  
for additional information.  
Closely-held classes of stock. In  
general, a class of stock of a foreign  
corporation that otherwise meets the  
requirements of the “regularly traded”  
rules described above shall not be treated  
as meeting such requirements for a tax  
year if, for more than half the number of  
days during the tax year, one or more 5%  
shareholders (defined below) own, in the  
aggregate, 50% or more of the vote and  
value of the outstanding shares of the  
class of stock. If one or more 5%  
Specific Instructions  
Part I—Qualified Foreign  
Corporation  
Line 1a. Enter the name of the qualified  
foreign country (defined earlier) in which  
the foreign corporation was organized.  
Primarily traded. Stock of a  
corporation is primarily traded in a country  
on one or more established securities  
markets (as defined in Regulations section  
1.883-2(b)) if, with respect to each class of  
stock described below under Regularly  
traded (that is, the more than 50%  
requirement), the number of shares in  
each such class that are traded during the  
tax year on all established securities  
markets in that country exceeds the  
number of shares in each such class that  
are traded during that year on established  
securities markets in any other single  
country.  
Line 1b. Type of equivalent  
exemption. Check one (and only one) of  
the boxes on line 1b to indicate the type of  
equivalent exemption granted by the  
foreign country listed on line 1a. For a  
non-inclusive list of countries that grant  
equivalent exemptions, see Rev. Rul.  
2008-17, 2008-12 I.R.B. 626, available at  
as modified by Announcement 2008-57,  
2008-26 I.R.B. 1192, available at  
shareholders own, in the aggregate, 50%  
or more of the vote and value of the  
outstanding shares of the class of stock,  
such shares held by the 5% shareholders  
will constitute a closely-held block of  
stock.  
Note. If the general rule described in the  
previous paragraph for closely-held  
classes of stock applies, the corporation  
must check the “Yes” box on line 9, and  
must complete lines 10a and 10b, to  
substantiate that the exception to this  
general rule (described next) applies. If  
the general rule described in the previous  
paragraph does not apply, the corporation  
checks the “No” box on line 9, and is not  
required to complete lines 10a and 10b.  
Line 1c. Applicable authority. Enter the  
applicable authority of the equivalent  
exemption. For example, enter a citation  
of the statute in the country where the  
corporation is organized, a diplomatic note  
between the United States and such  
country, or an income tax convention  
between the United States and such  
country.  
Regularly traded. The stock of a  
corporation is regularly traded on one or  
more established securities markets if:  
1. One or more classes of stock of the  
corporation that, in the aggregate,  
represent more than 50% of the total  
combined voting power of all classes of  
stock of such corporation entitled to vote  
and the total value of the stock of such  
corporation are listed on such market or  
markets during the tax year, and  
Exception to the general rule for  
closely-held classes of stock. The rules  
discussed in the previous paragraph shall  
not apply to a class of stock if the foreign  
Line 2a. Enter the gross income the  
foreign corporation derived from the  
carriage of passengers and cargo.  
2. With respect to each class relied on corporation can establish that qualified  
Line 2b. Enter the gross income the  
foreign corporation derived from time or  
voyage (full) charter income of a ship or  
wet lease income of an aircraft. See  
Regulations section 1.883-1(e)(5) for  
definition of terms.  
to meet the more than 50% requirement  
above (a) trades in each such class are  
effected, other than in de minimis  
shareholders (defined below in Part IV),  
applying the attribution rules of  
Regulations section 1.883-4(c), own  
sufficient shares in the closely-held block  
of stock to preclude nonqualified  
quantities, on such market or markets on  
at least 60 days during the tax year  
(or 1/6 of the number of days in a short tax  
year); and (b) the aggregate number of  
shares in each such class that are traded  
on such market or markets during the tax  
year are at least 10% of the average  
shareholders in the closely-held block of  
stock from owning 50% or more of the  
total value of the class of stock of which  
the closely-held block is a part for more  
than half the number of days during the  
Line 2c. Enter the gross income the  
foreign corporation derived from the  
bareboat charter of a ship or dry lease  
income of an aircraft. See Regulations  
section 1.883-1(e)(5) for definition of  
terms.  
number of shares outstanding in that class tax year. Any shares that are owned, after  
during the tax year (or, in the case of a  
short tax year, a percentage that equals at  
least 10% of the average number of  
application of the attribution rules in  
Regulations section 1.883-4(c), by a  
qualified shareholder shall not also be  
Lines 2d, 2e, and 2f. Enter on these  
lines the gross amount the corporation  
Instructions for Schedule S (Form 1120-F) (Rev. 12-2022)  
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treated as owned by a nonqualified  
shareholder in the chain of ownership for  
purposes of the preceding sentence. A  
foreign corporation must obtain the  
documentation described in Regulations  
section 1.883-4(d) from the qualified  
shareholders relied upon to satisfy this  
exception. However, no person otherwise  
treated as a qualified shareholder under  
Regulations section 1.883-4(b) may be  
treated for purposes of Regulations  
section 1.883-2(d)(3) as a qualified  
shareholder if such person's interest in the  
foreign corporation, or in any intermediary  
corporation, is held through bearer shares  
that are not maintained in a dematerialized  
or immobilized book-entry system during  
the relevant period. See Regulations  
section 1.883-2(d)(3)(ii).  
For purposes of the above rules, a 5%  
shareholder is a person who owns at  
least 5% of the total vote and value of the  
outstanding shares of a class of stock. For  
these purposes, persons related within the  
meaning of section 267(b) shall be treated  
as one person. In determining whether two  
or more corporations are members of the  
same controlled group under section  
267(b)(3), a person is considered to own  
stock owned directly by such person,  
stock owned through the application of  
section 1563(e)(1), and stock owned  
through the application of section 267(c).  
In determining whether a corporation is  
related to a partnership under section  
267(b)(10), a person is considered to own  
the partnership interest owned directly by  
such person and the partnership interest  
owned through the application of section  
267(e)(3).  
10b with respect to each such class. To do outstanding stock, including the value of  
so, complete these lines as follows:  
Complete line 10 of the actual schedule  
for the class of stock with respect to which  
5% shareholders own the largest  
percentage of the vote and value of the  
outstanding shares of the class of stock.  
For all other classes of stock, attach a  
statement that uses the same format as  
lines 10a and 10b.  
any bearer shares.  
Line 11b. Enter the percentage of the  
value of the outstanding shares of the  
CFC that are bearer shares maintained in  
a dematerialized or immobilized  
book-entry system. In determining the  
percentage to enter on line 11b, the  
numerator is the total value of bearer  
shares owned within the meaning of  
section 958(a) or Regulations section  
1.883-3(b)(4) by the qualified U.S.  
persons and maintained in a  
Line 10b(ii). Enter the applicable  
two-letter codes from the list of country  
dematerialized or immobilized book-entry  
system. The denominator is the total value  
of all the CFC's outstanding stock,  
including the value of any bearer shares.  
Part III—Stock Ownership  
Test for Controlled  
Foreign Corporations  
Line 12. Specify the days of the foreign  
corporation's tax year during which more  
than 50% of the total value of its  
outstanding stock was owned (within the  
meaning of section 958(a) and  
A foreign corporation satisfies the stock  
ownership test of Regulations section  
1.883-1(c)(2) if it satisfies the qualified  
U.S. person ownership test (see below)  
and the substantiation and reporting  
requirements of Regulations sections  
1.883-3(c) and (d).  
Regulations section 1.883-3(b)(4)) by  
qualified U.S. persons.  
Line 13. Specify the days of the foreign  
corporation's tax year during which it was  
a CFC (as defined in section 957(a)).  
Qualified U.S. person ownership test.  
This test is met only if:  
1. The foreign corporation is a CFC  
(as defined in section 957(a)) for more  
than half the days in the corporation's tax  
year, and  
2. More than 50% of the total value of  
its outstanding stock is owned (within the  
meaning of section 958(a) and  
Part IV—Qualified  
Shareholder Stock  
Ownership Test  
A foreign corporation satisfies the stock  
ownership test of Regulations section  
1.883-1(c)(2) if more than 50% of the  
value of its outstanding shares is owned,  
or treated as owned, by applying the  
attribution rules of Regulations section  
1.883-4(c), for at least half of the number  
of days in the foreign corporation's tax  
year by one or more qualified  
Regulations section 1.883-3(b)(4)) by one  
or more qualified U.S. persons (defined  
below) for more than half the days of the  
CFC's tax year, provided such days of  
ownership are concurrent with the time  
period during which the foreign  
Note. An investment company (as  
defined in Regulations section 1.883-2(d)  
(3)(iii)(B)) shall not be treated as a 5%  
shareholder.  
corporation was a CFC (as defined in item  
1 above).  
shareholders, as defined below. A  
shareholder may be a qualified  
A qualified U.S. person is a U.S.  
citizen, resident alien, domestic  
shareholder with respect to one category  
of income while not being a qualified  
shareholder with respect to another. A  
foreign corporation will not be considered  
to satisfy the qualified shareholder stock  
ownership test unless the foreign  
Line 8. Enter on line 8 a description of  
each class of stock the foreign corporation  
relied upon to satisfy the requirements of  
the “regularly traded” test described  
earlier. The description must include:  
corporation, or domestic trust described in  
section 501(a), but only if the person  
provides the CFC with an ownership  
statement as described in Regulations  
section 1.883-3(c)(2), and the CFC meets  
the reporting requirements of Regulations  
section 1.883-3(d) with respect to that  
person.  
corporation meets the substantiation and  
reporting requirements described in  
Regulations sections 1.883-4(d) and (e).  
An indication as to whether the class of  
stock was issued in registered or bearer  
form and whether such bearer shares  
were maintained in a dematerialized or  
immobilized book-entry system,  
A shareholder is a qualified  
Line 11a. Enter the percentage of the  
value of the shares of the CFC that is  
owned by all qualified U.S. persons  
identified in the qualified ownership  
statements. In determining the percentage  
to enter on line 11a, the numerator is the  
total value of the CFC's outstanding stock  
that is owned (within the meaning of  
section 958(a) and Regulations section  
1.883-3(b)(4)) by all qualified U.S.  
shareholder only if the shareholder:  
The number of issued and outstanding  
shares in that class of stock as of the  
close of the tax year, and  
1. With respect to the category of  
income for which the foreign corporation is  
seeking an exemption, is:  
The value of that class of stock in  
relation to the total value of all the  
corporation's shares outstanding as of the  
close of the tax year.  
(A) An individual who is a resident of a  
qualified foreign country. An individual  
is a resident of a qualified foreign  
country only if the individual is fully  
liable to tax as a resident in such  
country (for example, an individual  
who is liable to tax on a remittance  
basis in a foreign country will not be  
treated as a resident of that country  
unless all residents of that country are  
Line 9. See Regularly traded, earlier, for  
instructions for completing this line 9.  
persons, not including the value of any  
bearer shares (unless such shares are  
maintained in a dematerialized or  
Line 10. If the answer to line 9 is “Yes”  
with respect to one or more classes of the  
corporation's stock, the foreign  
immobilized book-entry system). The  
denominator is the total value of the CFC's  
corporation must complete lines 10a and  
Instructions for Schedule S (Form 1120-F) (Rev. 12-2022)  
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taxed on a remittance basis only) and,  
in addition (1) the individual has a tax  
home, within the meaning of  
Regulations section 1.883-4(b)(5)(iv))  
maintained in a dematerialized or  
that is administered in or by a qualified immobilized book-entry system.  
foreign country, who is treated as a  
resident under Regulations section  
1.883-4(d)(3)(iii) of a qualified foreign  
country; or  
3. Provides to the foreign corporation  
the documentation required in Regulations  
section 1.883-4(d).  
Regulations section 1.883-4(b)(2)(ii),  
in that qualified foreign country for 183  
days or more of the tax year, or (2) the  
individual is treated as a resident of a  
qualified foreign country based on  
special rules pursuant to Regulations  
section 1.883-4(d)(3);  
Line 16b. Enter the applicable  
two-letter codes from the list of country  
(F) A shareholder of a foreign  
corporation that is an airline covered  
by a bilateral Air Services Agreement  
in force between the United States  
and the qualified foreign country in  
which the airline is organized,  
Line 16c. Enter the percentage of the  
value of the outstanding shares that is  
owned, or treated as owned, by applying  
the attribution rules of Regulations section  
1.884-4(c) by the qualified shareholders  
as bearer shares maintained in a  
(B) The government of a qualified  
foreign country (or a political  
subdivision or local authority of such  
country);  
provided the United States has not  
waived the ownership requirement in  
the Air Services Agreement, or that  
the ownership requirement has not  
otherwise been made ineffective.  
(C) A foreign corporation that is  
organized in a qualified foreign  
country and meets the publicly-traded  
test of Regulations section 1.883-2(a);  
(D) A not-for-profit organization  
described in Regulations section  
1.883-4(b)(4) that is not a pension  
fund as defined in Regulations section  
1.883-4(b)(5) and that is organized in  
a qualified foreign country;  
dematerialized or immobilized book-entry  
system. In determining the percentage to  
enter on line 16c, the numerator is the total  
value of bearer shares owned by the  
qualified shareholders and maintained in a  
dematerialized or immobilized book-entry  
system. The denominator is the total value  
of all outstanding shares of the  
2. Does not own its interest in the  
foreign corporation through bearer shares,  
either directly or by applying the attribution  
rules of Regulations section 1.883-4(c).  
However, the shareholder may own its  
interest in the foreign corporation through  
bearer shares if such shares are  
corporation, including the value of any  
bearer shares.  
(E) An individual beneficiary of a  
pension fund (as defined in  
Instructions for Schedule S (Form 1120-F) (Rev. 12-2022)  
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