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•

Cash and cash items (including

had no accumulated earnings and profits

General Instructions

receivables),

from any non-RIC tax year.

•

Government securities,

•

Note. For this purpose, current year

Securities of other RICs, and

Purpose of Form

•

distributions are treated as made from the

Securities of other issuers, except that

earliest earnings and profits accumulated in

the investment in a single issuer of

Use Form 1120-RIC, U.S. Income Tax

any non-RIC tax year. See section

securities may not exceed 5% of the value

Return for Regulated Investment

852(c)(3). Also see section 852(e) for

of the RIC’s assets or 10% of the

Companies, to report the income, gains,

procedures that may allow the RIC to avoid

outstanding voting securities of the issuer

losses, deductions, credits, and to figure the

disqualification for the initial year if the RIC

(except as provided in section 851(e)). See

income tax liability of a regulated investment

did not meet this requirement.

sections 851(b)(3) and 851(c).

company (RIC) as defined in section 851.

3. At the end of each quarter of the

Definition of a Fund

Who Must File

RIC’s tax year, no more than 25% of the

The term “fund” as used in these

value of the RIC’s assets may be invested in

A domestic corporation that meets certain

instructions and Form 1120-RIC, refers to a

the securities of:

conditions (discussed below) must file Form

•

separate portfolio of assets, whose

A single issuer (excluding government

1120-RIC if it elects to be treated as a RIC

beneficial interests are owned by the

securities or securities of other RICs),

for the tax year (or has made an election for

•

holders of a class or series of stock of the

Two or more issuers controlled by the

a prior tax year and the election has not

RIC that is preferred over all other classes

RIC and engaged in the same or related

been terminated or revoked). The election is

or series for that portfolio of assets.

trades or businesses, or

made by computing taxable income as a

•

One or more qualified publicly traded

RIC on Form 1120-RIC.

When To File

partnerships as defined in section 851(h).

See sections 851(b)(3) and 851(c) for

Generally, a RIC must file its income tax

General Requirements To

further details.

return by the 15th day of the 3rd month after

the end of its tax year. A new RIC filing a

Qualify as a RIC

4. The RIC’s deduction for dividends

short period return must generally file by the

paid for the tax year (as defined in section

The term “regulated investment company”

15th day of the 3rd month after the short

561, but without regard to capital gain

applies to any domestic corporation that:

period ends. A RIC that has dissolved must

dividends) equals or exceeds the sum of:

•

Is registered throughout the tax year as a

generally file by the 15th day of the 3rd

90% of its investment company

management company or unit investment

month after the date of dissolution.

taxable income determined without regard to

trust under the Investment Company Act of

section 852(b)(2)(D); and

If the due date falls on a Saturday,

1940 (the ICA),

•

90% of the excess of the RIC’s interest

Sunday, or legal holiday, the RIC may file its

•

Has an election in effect under the ICA to

income excludable from gross income under

return on the next business day.

be treated as a business development

section 103(a) over its deductions

company, or

Private delivery services

disallowed under sections 265 and

•

Is a common trust fund or similar fund that

171(a)(2).

RICs can use certain private delivery

is neither an investment company under

5. The RIC must either have been a RIC

services designated by the IRS to meet the

section 3(c)(3) of the ICA nor a common

for all tax years ending after November 7,

“timely mailing as timely filing/paying” rule

trust fund as defined under section 584(a).

1983, or, at the end of the current tax year,

for tax returns and payments.

Other Requirements

Where To File

In addition, the RIC must meet all of the

requirements listed below:

1. At least 90% of its gross income

File the RIC’s return at the applicable IRS address listed below.

(including tax-exempt interest income) must

be derived from the following items.

If the RIC’s principal

And the total assets at the

Use the following Internal

•

Dividends,

business, office, or agency

end of the tax year (Form

Revenue Service Center

•

Interest,

is located in:

1120-RIC, page 1, item D)

address:

•

Payments with respect to securities

are:

loans (as defined in section 512(a)(5)),

•

Connecticut, Delaware, District

Gains from the sale or other

of Columbia, Illinois, Indiana,

disposition of stock or securities (as defined

Kentucky, Maine, Maryland,

in ICA section 2(a)(36)) or foreign

Massachusetts, Michigan, New

Less than $10 million

Cincinnati, OH 45999-0012

currencies,

•

Hampshire, New Jersey, New

Other income (including gains from

York, North Carolina, Ohio,

options, futures, or forward contracts)

Pennsylvania, Rhode Island,

derived from the RIC’s business of investing

South Carolina, Vermont,

$10 million or more

Ogden, UT 84201-0012

in such stock, securities, or currencies, and

•

Virginia, West Virginia,

Net income derived from an interest in

Wisconsin

a qualified publicly traded partnership (as

defined in section 851(h)).

Alabama, Alaska, Arizona,

Income from a partnership or trust

Arkansas, California,

qualifies under the 90% test to the extent

Colorado, Florida, Georgia,

the RIC’s distributive share of such income

Hawaii, Idaho, Iowa, Kansas,

is from items described above as realized by

Louisiana, Minnesota,

the partnership or trust.

Mississippi, Missouri,

Any amount

Ogden, UT 84201-0012

Montana, Nebraska, Nevada,

Income that a RIC receives in the normal

New Mexico, North Dakota,

course of business as a reimbursement from

Oklahoma, Oregon, South

its investment advisor is qualifying income

Dakota, Tennessee, Texas,

for purposes of the 90% test if the

Utah, Washington, Wyoming

reimbursement is includible in the RIC’s

gross income.

2. At the end of each quarter of the

A group of corporations with members located in more than one service center area will

RIC’s tax year, at least 50% of the value of

often keep all the books and records at the principal office of the managing corporation. In

its assets must be invested in the following

this case, file the tax returns with the service center for the area in which the principal office

items.

of the managing corporation is located.

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Instructions For Form 1120-Ric - U.s. Income Tax Return For Regulated Investment Companies - 2005 Page 2

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