Looking for a Form 1120-ric Templates? Download it for free!

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Tax Map: an electronic research tool

distribution requirements explained

Cash and cash items (including

and finding aid.

below.

receivables);

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Tax law frequently asked questions

Government securities;

The income test: At least 90% of its

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(FAQs).

Securities of other RICs; and

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gross income must be derived from the

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Tax Topics from the IRS telephone

Securities of other issuers, except

following items:

response system.

that the investment in a single issuer of

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Dividends;

Internal Revenue Code – Title 26 of

securities may not exceed 5% of the

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Interest (including tax-exempt interest

the U.S. Code.

value of the RIC’s assets or 10% of the

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income);

Fill-in, print, and save features for most

outstanding voting securities of the issuer

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Payments with respect to securities

tax forms.

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

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

Internal Revenue Bulletins.

2. At the end of each quarter of the

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Gains from the sale or other disposition

Toll-free and email technical support.

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

of stock or securities (as defined in ICA

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Two releases during the year.

value of the RIC’s assets may be invested

section 2(a)(36)) or foreign currencies;

— The first release will ship early in

in the securities of:

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Other income (including gains from

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January 2010.

A single issuer (excluding

options, futures, or forward contracts)

— The final release will ship early in

government securities or securities of

derived from the RIC’s business of

March 2010.

other RICs);

investing in such stock, securities, or

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Two or more issuers controlled by

Buy the DVD from the National

currencies; and

the RIC and engaged in the same or

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Technical Information Service (NTIS) at

Net income derived from an interest in

related trades or businesses; or

for $30 (no

a qualified publicly traded partnership (as

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One or more qualified publicly

handling fee) or call 1-877-233-6767

defined in section 851(h)).

traded partnerships as defined in section

toll-free to buy the DVD for $30 (plus a $6

Income from a partnership or trust

851(h).

handling fee). Price is subject to change.

qualifies under the 90% test to the extent

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

By phone and in person. You can

the RIC’s distributive share of such

further details.

order forms and publications by calling

income is from items described above as

1-800-TAX-FORM (1-800-829-3676). You

realized by the partnership or trust.

Distribution requirements. The RIC’s

can also get most forms and publications

deduction for dividends paid for the tax

Income that a RIC receives in the

at your local IRS office.

year (as defined in section 561, but

normal course of business as a

without regard to capital gain dividends)

reimbursement from its investment

equals or exceeds the sum of:

advisor is qualifying income for purposes

General Instructions

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90% of its investment company taxable

of the 90% test if the reimbursement is

income determined without regard to

includible in the RIC’s gross income.

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

Purpose of Form

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The asset test:

90% of the excess of the RIC’s interest

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

1. At the end of each quarter of the

income excludable from gross income

Return for Regulated Investment

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

under section 103(a) over its deductions

Companies, to report the income, gains,

of its assets must be invested in the

disallowed under sections 265 and

losses, deductions, credits, and to figure

following items:

171(a)(2).

the income tax liability of a regulated

investment company (RIC) as defined in

section 851.

Where To File

Who Must File

A domestic corporation that meets certain

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

conditions (discussed below) must file

And the total assets at

Form 1120-RIC if it elects to be treated as

If the RIC’s principal

the end of the tax year

a RIC for the tax year (or has made an

business, office, or agency

(Form 1120-RIC, page 1,

election for a prior tax year and the

is located in:

item D) are:

Use the following address:

election has not been terminated or

revoked). The election is made by

Connecticut, Delaware, District

Department of the Treasury

computing taxable income as a RIC on

of Columbia, Georgia, Illinois,

Less than $10 million

Internal Revenue Service Center

Form 1120-RIC.

Indiana, Kentucky, Maine,

Cincinnati, OH 45999-0012

Maryland, Massachusetts,

General Requirements To

Michigan, New Hampshire,

New Jersey, New York, North

Qualify as a RIC

Carolina, Ohio, Pennsylvania,

Department of the Treasury

The term “regulated investment company”

Rhode Island, South Carolina,

$10 million or more

Internal Revenue Service Center

applies to any domestic corporation that:

Tennessee, Vermont, Virginia,

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Ogden, UT 84201-0012

Is registered throughout the tax year as

West Virginia, Wisconsin

a management company or unit

Alabama, Alaska, Arizona,

investment trust under the Investment

Arkansas, California, Colorado,

Company Act of 1940 (ICA),

Florida, Hawaii, Idaho, Iowa,

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Has an election in effect under the ICA

Kansas, Louisiana, Minnesota,

Department of the Treasury

to be treated as a business development

Mississippi, Missouri, Montana,

Any amount

Internal Revenue Service Center

company, or

Nebraska, Nevada, New

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Ogden, UT 84201-0012

Is a common trust fund or similar fund

Mexico, North Dakota,

that is neither an investment company

Oklahoma, Oregon, South

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

Dakota, Texas, Utah,

common trust fund as defined under

Washington, Wyoming

section 584(a).

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

Other Requirements

will often keep all the books and records at the principal office of the managing

In addition, the RIC must meet the (1)

corporation. In this case, file the tax returns with the service center for the area in which

income test, (2) asset test, and (3)

the principal office of the managing corporation is located.

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Instructions For Form 1120-Ric - U.s. Income Tax Return For Regulated Investment Companies - 2009 Page 2

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