Instructions For Schedule O (Form 1120) - 2011 printable pdf download

2011

Department of the Treasury

Internal Revenue Service

Instructions for Schedule O

(Form 1120)

Consent Plan and Apportionment Schedule for a Controlled Group

Who Must File

agreement as the member’s basis for

Section references are to the Internal

Revenue Code unless otherwise noted.

representing on its Schedule O that

A corporation must file Schedule O

the other component members of the

with its income tax return, amended

group have also consented to

What’s New

return, or claim for refund for each tax

adopting, amending, or terminating

year that the corporation is a

the apportionment plan.

component member of a controlled

•

Future Developments. The IRS

The agreement must be signed by

group, even if (1) no apportionment

a person authorized to sign on behalf

has created a page on IRS.gov for

plan is in effect, or (2) the amounts

of each component member of the

information about Form 1120

apportioned have not changed from

controlled group and retained. No

(Schedule O) and its instructions at

the previous tax year. See Definitions

member should attach this agreement

Information

and Special Rules, below.

(or a copy of it) to their federal

about any future developments

Consolidated groups. If any of the

income tax returns. Each component

affecting Form 1120 (Schedule O)

component members of a controlled

member must keep, as part of its

(such as legislation enacted after we

group are also members of a

records, either the original or a copy

release it) will be posted on that

consolidated group, then the common

of the signed agreement. The

page.

parent of that consolidated group

agreement must contain the group’s

must file, as part of its consolidated

apportionment methodology (for

General Instructions

income tax return, one Schedule O

example, percentages) for each tax

on behalf of the members of that

benefit item that is apportioned.

consolidated group. No subsidiary of

Purpose of Schedule

that consolidated group should file

Definitions and Special

A corporation that is a component

Schedule O on its own behalf. The

Rules

member (defined below) of a

Schedule O should contain the

controlled group must use Schedule

required consolidated information for

O to report the apportionment of

all members of the consolidated

Types of Controlled Groups

taxable income, income tax, and

group. See Identifying Information.

Parent-subsidiary group. A

certain tax benefits between all

Exception. If all of the members

parent-subsidiary group is one or

component members of the group.

of a parent-subsidiary controlled

more chains of corporations

These members will be subject to

group that are required to file a U.S.

connected through stock ownership

limitations on the use of certain tax

tax return join in filing the same

with a common parent corporation if:

benefits for their applicable tax year.

consolidated tax return, then the

•

Stock possessing at least 80% of

See Apportionment of Tax Benefit

parent of that group does not have to

the total combined voting power of all

Items.

file Schedule O on behalf of the

classes of stock entitled to vote or at

group.

least 80% of the total value of shares

Also use Schedule O to indicate

Completing and Filing

of all classes of stock of each of the

that the member filing this return

corporations, except the common

Schedule O

consents to and represents that all

parent corporation, is directly or

the other component members of the

In completing Schedule O, the

indirectly owned by one or more of

controlled group:

following apply.

the other corporations; and

•

Are adopting an apportionment

The filing of Schedule O by a

•

The common parent corporation

plan, effective for the current tax year;

component member provides the

directly or indirectly owns stock

•

required information as to the status

Are amending the existing

possessing at least 80% of the total

of the group’s apportionment plan.

apportionment plan;

combined voting power of all classes

Such information must indicate, when

•

Are terminating the existing

of stock entitled to vote or at least

applicable, whether all the component

apportionment plan and not adopting

80% of the total value of shares of all

members of the controlled group are

a new plan;

classes of stock of at least one of the

adopting, amending, or terminating

•

other corporations, excluding, in

Are terminating the existing

an apportionment plan.

computing such voting power or

apportionment plan and adopting a

•

If all such members complete the

value, stock owned directly by such

new plan;

required written agreement setting

other corporations.

•

Have no apportionment plan in

forth the terms of the adopted or

effect and are not adopting an

amended apportionment plan (or an

For purposes of determining

apportionment plan; or

agreement to terminate a previously

whether a corporation is a member of

•

Already have an apportionment

adopted plan), then each member of

a parent-subsidiary controlled group

plan in effect.

that group may rely on this

of corporations within the meaning of

Dec 22, 2011

Cat. No. 48211V

Instructions For Schedule O (Form 1120) - 2011

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