Instructions For Form 1125-E - Compensation Of Officers

a parachute payment. See section 280G(e) and Notice

compensation. See section 280C. If the corporation

2008-94.

provided taxable fringe benefits to its officers, such as

personal use of a car, do not deduct as wages the amount

Specific Instructions

allocated for depreciation and other expenses claimed

elsewhere on the return.

Line 1

Line 4

Complete columns (a) through (f) for all officers. A

Enter the amount from line 4 on Form 1120, page 1,

corporation determines who is an officer under the laws of

line 12, or the appropriate line of the applicable return.

the state/country where it is incorporated.

See the instructions for the applicable entity's return.

If a consolidated return is filed, this information must be

Paperwork Reduction Act Notice. We ask for the

furnished for each officer of the affiliated group. However,

information on this form to carry out the Internal Revenue

the common parent of a consolidated group may file, as

laws of the United States. You are required to give us the

part of its consolidated return, one Form 1125-E on behalf

information. We need it to ensure that you are complying

of the members of the affiliated group.

with these laws and to allow us to figure and collect the

Column (b). Enter each officer's SSN in column (b).

right amount of tax.

Filers may elect to provide only the last four digits of the

You are not required to provide the information

officer's SSN.

requested on a form that is subject to the Paperwork

Column (f). Enter each officer's total deductible

Reduction Act unless the form displays a valid OMB

compensation (such as salaries, commissions, bonuses,

control number. Books or records relating to a form or its

taxable fringe benefits, etc.). For officers of an S

instructions must be retained as long as their contents

corporation, include fringe benefits and expenditures

may become material in the administration of any Internal

made on behalf of officers owning more than 2% of the

Revenue law. Generally, tax returns and return

corporation's stock. Do not include amounts paid or

information are confidential, as required by section 6103.

incurred for fringe benefits of officers owning 2% or less of

an S corporation's stock. These amounts are reported

The time needed to complete and file this form will vary

elsewhere on the corporation's return. See the

depending on individual circumstances. The estimated

Instructions for Form 1120S for more information on

burden for business taxpayers filing this form is approved

deductible officers’ compensation.

under OMB control number 1545-0123 and is included in

the estimates shown in the instructions for their business

Line 3

income tax return.

Enter compensation of officers deductible elsewhere on

If you have comments concerning the accuracy of

the return, such as amounts included in cost of goods

these time estimates or suggestions for making this form

sold, elective contributions to a section 401(k) cash or

simpler, we would be happy to hear from you. See the

deferred arrangement, or amounts contributed under a

instructions for the tax return with which this form is filed.

salary reduction SEP agreement or a SIMPLE IRA plan.

If the corporation claims a credit for any wages paid or

incurred, it may need to reduce its deduction for officers’

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Instructions For Form 1125-E - Compensation Of Officers - 2016 Page 2

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