Instructions For Form 1120-Pc - 2009 (Page 16 of 21) in pdf

•

section 854(b). The corporation should

Qualify for the 80% deduction under

The 100% deduction does not apply to

receive a notice from the RIC specifying

section 245(a).

affiliated group members that are joining

the amount of dividends that qualify for

in the filing of a consolidated return.

Also include dividends received from

the deduction.

Line 10, column (b). Enter foreign

a 20%-or-more-owned FSC that:

Report so-called dividends or earnings

•

dividends not reportable on lines 3, 6, 7 or

Are attributable to income treated as

received from mutual savings banks, etc.,

8 of column (b). Include on line 10 the

effectively connected with the conduct of

as interest. Do not treat them as

corporation’s share of the ordinary

a trade or business within the United

dividends.

earnings of a qualified electing fund from

States (excluding foreign trade income)

line 1c, Form 8621, Return by a

Line 2. Enter on line 2:

and

•

Shareholder of a Passive Foreign

Dividends (except those received on

•

Qualify for the 80% deduction provided

Investment Company or Qualifying

debt-financed stock acquired after July

in section 245(c)(1)(B).

Electing Fund. Exclude distributions of

18, 1984) that are received from

amounts constructively taxed in the

20%-or-more-owned domestic

Line 8. Enter dividends received from

current year or in prior years under

corporations subject to income tax and

wholly owned foreign subsidiaries that are

subpart F (sections 951 through 964).

that are subject to the 80% deduction

eligible for the 100% deduction under

under section 243(c), and

section 245(b).

Line 11, column (b). Include income

•

Taxable distributions from an IC-DISC

constructively received from controlled

In general, the deduction under

or former DISC that are considered

foreign corporations under subpart F. This

section 245(b) applies to dividends paid

eligible for the 80% deduction.

amount should equal the total subpart F

out of the earnings and profits of a foreign

Line 3. Enter the following.

income reported on Schedule I of Form

corporation for a tax year during which:

•

Dividends received on debt-financed

5471, Information Return of U.S. Persons

•

All of its outstanding stock is directly or

stock acquired after July 18, 1984, from

With Respect to Certain Foreign

indirectly owned by the domestic

domestic and foreign corporations subject

Corporations.

corporation receiving the dividends, and

to income tax that would otherwise be

•

Line 12, column (b). Include gross-up

All of its gross income from all sources

subject to the dividends-received

for taxes deemed paid under sections 902

is effectively connected with the conduct

deduction under section 243(a)(1),

and 960.

of a trade or business within the United

243(c), or 245(a). Generally,

States.

Line 13, column (b). Include the

debt-financed stock is stock that the

following.

corporation acquired by incurring a debt

Also, include on line 8 dividends from

(for example, it borrowed money to buy

1. Dividends (other than capital gain

FSCs that are attributable to foreign trade

the stock).

distributions reported on Schedule D

income and that are eligible for the 100%

•

Dividends received from a RIC on

(Form 1120) and exempt-interest

deduction provided in section

debt-financed stock. The amount of

dividends) that are received from RICs

245(c)(1)(A).

dividends eligible for the

and that are not subject to the 70%

dividends-received deduction is limited by

Line 9. Enter only those dividends that

deduction.

section 854(b). The corporation should

qualify under section 243(b) for the 100%

2. Dividends from tax-exempt

receive a notice from the RIC specifying

dividends-received deduction described in

organizations.

the amount of dividends that qualify for

section 243(a)(3). Corporations taking this

3. Dividends (other than capital gain

the deduction.

deduction are subject to the provisions of

distributions) received from a REIT that,

section 1561.

for the tax year of the trust in which the

Line 4. Enter dividends received on

preferred stock of a less-than-20%-owned

public utility that is subject to income tax

Worksheet for Schedule C, line 23

Keep for Your Records

and is allowed the deduction provided in

section 247 for dividends paid.

1. Refigure the amount from Schedule A, line 35 or Schedule B, line

Line 5. Enter dividends received on

19, whichever applies, without any domestic production activities

preferred stock of a 20%-or-more-owned

deduction, any adjustment under section 1059, and without any

public utility that is subject to income tax

capital loss carryback to the tax year under section 1212(a)(1) . .

and is allowed the deduction provided in

2. Enter the sum of the amounts from line 22, column (b) (without

section 247 for dividends paid.

regard to wholly owned foreign subsidiary dividends) and line 9,

Line 6. Enter the U.S.-source portion of

column (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

dividends that:

3. Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . .

•

Are received from

4. Multiply line 3 by 80% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

less-than-20%-owned foreign

5. Add lines 16, 19, 21, and 22 (without regard to FSC dividends),

corporations, and

•

column (b), and the portion of the deduction on line 17, column

Qualify for the 70% deduction under

(b), that is attributable to dividends received from

section 245(a). To qualify for the 70%

20%-or-more-owned corporations . . . . . . . . . . . . . . . . . . . . . .

deduction, the corporation must own at

least 10% of the stock of the foreign

6. Enter the smaller of line 4 or line 5. If line 5 is greater than line 4,

corporation by vote and value.

stop here; enter the amount from line 6 on line 23, column (b),

Also include dividends received from a

and do not complete the rest of this worksheet . . . . . . . . . . . . .

less-than-20%-owned foreign sales

7. Enter the total amount of dividends received from

corporation (FSC) that:

20%-or-more-owned corporations that are included on lines 2, 3,

•

Are attributable to income treated as

5, 7, and 8 (without regard to FSC dividends), column (b) . . . . .

effectively connected with the conduct of

8. Subtract line 7 from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . .

a trade or business within the United

9. Multiply line 8 by 70% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

States (excluding foreign trade income)

10. Subtract line 5 from line 23, column (b) (without regard to FSC

and

•

dividends) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Qualify for the 70% deduction under

11. Enter the smaller of line 9 or line 10 . . . . . . . . . . . . . . . . . . . . .

section 245(c)(1)(B).

12. Dividends-received deduction after limitation (section

Line 7. Enter the U.S.-source portion of

246(b)). Add lines 6 and 11. Enter the result here and on line 23,

dividends that:

•

column (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Are received from 20%-or-more-owned

foreign corporations, and

-16-

Instructions for Form 1120-PC (2009)

Instructions For Form 1120-Pc - 2009 Page 16

Related Articles

Related forms

Related Categories