Form 851 (1992) - Affiliations Schedule (Page 4 of 4) in pdf

Page

Form 851 (Rev. 1-92)

Instructions

least 80% of the total value of the stock

Nondividend distributions.—For

of at least one of the other includible

purposes of Part II, nondividend

(Section references are to the Internal

corporations.

distributions are any distributions (other

Revenue Code.)

than stock dividends and distributions in

2. Stock that represents at least 80%

exchange for stock) paid during the tax

of the total voting power, and at least

Paperwork Reduction Act

year for which the consolidated tax

80% of the total value of the stock of

Notice

return is filed that were in excess of the

each of the other corporations (except

corporation’s current and accumulated

for the common parent) must be owned

We ask for the information on this form

earnings and profits. See sections 301

directly by at least one of the other

to carry out the Internal Revenue laws of

and 316.

includible corporations.

the United States. You are required to

For this purpose, the term “stock”

give us the information. We need it to

Part IV

generally does not include any stock

ensure that you are complying with

that (1) is nonvoting, (2) is

Question 1.—For purposes of Question

these laws and to allow us to figure and

nonconvertible, (3) is limited and

1 only, disregard section 1504(a)(4).

collect the right amount of tax.

preferred as to dividends and does not

The time needed to complete and file

Question 3a.—The term “arrangement”

participate significantly in corporate

includes, but is not limited to, phantom

this form will vary depending on

growth, and (4) has redemption and

stock, stock appreciation rights, an

individual circumstances. The estimated

liquidation rights that do not exceed the

option, warrant, conversion feature, or

average time is:

issue price of the stock (except for a

similar arrangement. If you answer “Yes”

Recordkeeping

8 hr., 51 min.

reasonable redemption or liquidation

to question 3a, complete items 3b

Learning about the

premium).

through 3e.

law or the form

35 min.

Item 3b.—If you answer “Yes” to

Address

Preparing and sending

question 3a, show the percentage of the

the form to the IRS

46 min.

Include the suite, room, or other unit

value of the outstanding stock that the

If you have comments concerning the

number after the street address. If the

person(s) could acquire.

accuracy of these time estimates or

Post Office does not deliver mail to the

Item 3c.—If you answer “Yes” to

suggestions for making this form more

street address and the corporation has a

question 3a, and the arrangement was

simple, we would be happy to hear from

P.O. box, show the box number instead

associated with voting stock, show the

you. You can write to both the IRS and

of the street address.

percentage of outstanding voting stock

the Office of Management and Budget

that the person(s) could acquire.

Corporation Numbers

at the addresses listed in the

Item 3d.—If you answer “Yes” to

instructions for the tax return with which

When listing information in Parts II, III,

question 3a, and the arrangement was

this form is filed.

and IV, be sure to use the same number

associated with the acquisition of voting

for each corporation as you used in Part

power without the acquisition of the

Purpose of Form

I, page 1.

related stock, show the percentage of

Form 851 is filed by the parent

voting power that the person(s) could

Part II

corporation for itself and for affiliated

acquire.

corporations in the affiliated group. File

Item 3e.—If you answer “Yes” to

PBA (Principal Business Activity) code

Form 851 by attaching it to the

question 3a, give a brief description of

number.—Enter in Part II the PBA code

consolidated tax return for the group.

any arrangement (defined above) by

number for the parent corporation and

which a person that is not a member of

each subsidiary. A list of the PBA code

Affiliated Group

the affiliated group could acquire any

numbers can be found in the

stock, or acquire any voting power

The term “affiliated group” means one or

Instructions for Forms 1120 and 1120-A.

without acquiring stock, in the

more chains of includible corporations

Use the code number for the specific

corporation.

(section 1504(a)) connected through

industry group from which the largest

stock ownership with a common parent

percentage of each corporation’s total

corporation. The common parent must

receipts is derived.

be an includible corporation and the

Also list for each subsidiary the

following requirements must be met:

corresponding principal business activity

1. The common parent must own

on which the code is based.

directly stock that represents at least

80% of the total voting power and at

Form 851 (1992) - Affiliations Schedule Page 4

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