Instructions For Form 1120-Fsc - 2006 (Page 6 of 13) in pdf

If the FSC prefers, it may mail the

Late filing of return. A FSC that does not

Name. Print or type the FSC’s true name

coupon and payment to: Financial Agent,

file its tax return by the due date, including

(as set forth in the charter or other legal

Federal Tax Deposit Processing, P.O. Box

extensions, may be penalized 5% of the

document creating it).

970030, St. Louis, MO 63197. Make the

unpaid tax for each month or part of a month

Address. Enter the U.S. address where the

check or money order payable to

the return is late, up to a maximum of 25%

FSC maintains the records required under

“Financial Agent.”

of the unpaid tax. The minimum penalty for

section 6001. Include the suite, room, or

a return that is over 60 days late is the

other unit number after the street address. If

To help ensure proper crediting, write the

smaller of the tax due or $100. The penalty

the post office does not deliver mail to the

FSC’s EIN, the tax period to which the

will not be imposed if the FSC can show that

street address and the FSC has a P.O. box,

deposit applies, and “Form 1120-FSC” on

the failure to file on time was due to

show the box number instead.

the check or money order. Darken the

reasonable cause. FSCs that file late should

“1120” box under “Type of Tax” and the

If the FSC receives its mail in care of a

attach a statement explaining the

appropriate “Quarter” box under “Tax

third party (such as an accountant or an

reasonable cause.

Period” on the coupon. Records of these

attorney), enter on the street address line

deposits will be sent to the IRS.

Late payment of tax. A FSC that does not

“C/O” followed by the third party’s name and

pay the tax when due generally may be

street address or P.O. box.

For more information on deposits, see

penalized

of 1% of the unpaid tax for

the instructions in the coupon booklet (Form

Item A. Foreign country or U.S.

each month or part of a month the tax is not

8109) and Pub. 583, Starting a Business

possession of incorporation. See

paid, up to a maximum of 25% of the unpaid

and Keeping Records.

Definition of a Foreign Sales Corporation

tax. The penalty will not be imposed if the

(FSC) on page 2.

FSC can show that the failure to pay on time

was due to reasonable cause.

Item E. Total assets. Enter the FSC’s total

If the FSC maintains an office or

assets (as determined by the accounting

place of business in the United

Trust fund recovery penalty. This penalty

method regularly used in keeping the FSC’s

States and it owes tax when it files

CAUTION

may apply if certain income, social security,

books and records) at the end of the tax

Form 1120-FSC, do not include the payment

and Medicare taxes that must be collected

year from page 6, Schedule L, column (d),

with the tax return. Instead, mail or deliver

or withheld are not collected or withheld, or

line 15. If there are no assets at the end of

the payment with Form 8109 to an

these taxes are not paid. These taxes are

the tax year, enter -0-.

authorized depositary, or use EFTPS, if

generally reported on Form 941, Employer’s

applicable.

Quarterly Federal Tax Return, or Form 945,

Item F. Final return, name change,

Annual Return of Withheld Federal Income

address change, or amended return.

•

Estimated Tax Payments

Tax.

If this is the FSC’s final return and it will

no longer exist, check the “Final return” box.

Generally, the following rules apply to the

The trust fund recovery penalty may be

•

If the FSC changed its name since it last

FSC’s payments of estimated tax:

imposed on all persons who are determined

filed a return, check the box for “Name

•

by the IRS to have been responsible for

The FSC must make installment

change.” Generally, a FSC also must have

collecting, accounting for, and paying over

payments of estimated tax if it expects its

amended its articles of incorporation and

these taxes, and who acted willfully in not

total tax for the year (less applicable credits)

filed the amendment with the jurisdiction in

doing so. The penalty is equal to the unpaid

to be $500 or more.

which it was incorporated.

•

trust fund tax. See Pub. 15 (Circular E),

•

The installments are due by the 15th day

If the FSC has changed its address since

Employer’s Tax Guide, for details, including

of the 4th, 6th, 9th, and 12th months of the

it last filed a return (including a change to an

the definition of responsible persons.

tax year. If any date falls on a Saturday,

“in care of” address), check the box for

Sunday, or legal holiday, the installment is

“Address change.”

Other penalties. Other penalties may be

due on the next regular business day.

imposed for negligence, substantial

Note. If a change of address occurs after

•

Use Form 1120-W, Estimated Tax for

understatement of tax, and fraud. See

the return is filed, use Form 8822, Change

Corporations, as a worksheet to compute

sections 6662, 6662A, and 6663.

of Address, to notify the IRS of the new

estimated tax.

address.

•

A FSC may also be subject to a penalty

If the FSC maintains an office or place of

•

If the FSC is amending its return, check

(under section 6686) of:

business in the United States and it does

•

the box for “Amended return.”

$100 for each failure to supply

not use EFTPS, use the deposit coupons

information, up to $25,000 during the

(Forms 8109) to make deposits of estimated

FSC Information

calendar year.

tax.

•

$1,000 for not filing a return.

If the FSC does not maintain an office or

Line 1. Principal shareholder. Complete

place of business in the United States, it

lines 1a through 1h for the shareholder

These penalties will not apply if the FSC

must pay the estimated tax due directly to

(individual, corporation, partnership, trust, or

can show that the failure to furnish the

the IRS

estate) that was the principal shareholder at

required information was due to reasonable

•

If the FSC overpaid estimated tax, it may

the beginning of the FSC’s tax year. See the

cause.

be able to get a quick refund by filing Form

Note on page 5 under Accounting Period.

4466, Corporation Application for Quick

Foreign address. Enter the information

Refund of Overpayment of Estimated Tax.

in the following order: city, province or state,

Specific Instructions

For more information on estimated tax

and country. Follow the country’s practice

payments, including penalties that apply if

for entering the postal code. Do not

the FSC fails to make required payments,

abbreviate the country name.

Period covered. File the 2006 return for

see Line 3, Estimated tax penalty,

calendar year 2006 and fiscal years that

Line 2. Parent-subsidiary controlled

on page 7.

begin in 2006 and end in 2007. For a fiscal

group. If the FSC is a subsidiary in a

year return, fill in the tax year space at the

parent-subsidiary controlled group and the

Interest and Penalties

top of the form.

principal shareholder is not the common

parent of the group, complete lines 2a

Note. The 2006 Form 1120-FSC may also

Interest. Interest is charged on taxes paid

through 2g for the common parent. Enter the

be used if:

late even if an extension of time to file is

•

consolidated total assets on line 2d for a

The FSC has a tax year of less than 12

granted. Interest is also charged on

group that files a consolidated return;

months that begins and ends in 2007 and

penalties imposed for failure to file,

•

otherwise, enter only the common parent’s

The 2007 Form 1120-FSC is not available

negligence, fraud, substantial valuation

total assets.

at the time the FSC is required to file its

misstatements, gross valuation

return.

Note. Check the “Yes” box on line 2 if the

misstatements, substantial understatements

FSC is a subsidiary in a parent-subsidiary

of tax, and reportable transaction

The FSC must show its 2007 tax year on

controlled group. This applies even if the

understatements from the due date

the 2006 Form 1120-FSC and take into

FSC is a subsidiary member of one group

(including extensions) to the date of

account any tax law changes that are

and the parent corporation of another.

payment. The interest charge is figured at a

effective for tax years beginning after

rate determined under section 6621.

December 31, 2006.

-6-

Instructions For Form 1120-Fsc - 2006 Page 6

Related Articles

Related forms

Related Categories