Instructions For Form 1120-Pc - 2016 (Page 18 of 23) in pdf

8 of column (b). Include on line 10 the

corporation's share of distributions from a

Keep for Your Records

section 1291 fund from Form 8621, to the

Worksheet for Schedule C, line 23

extent that the amounts are taxed as

1. Refigure the amount from Schedule A, line 35 or Schedule B,

dividends under section 301. See Form

line 19, whichever applies, without any domestic production

8621 and the Instructions for Form 8621.

activities deduction, any adjustment under section 1059, and

Line 11, column (b). Include income

without any capital loss carryback to the tax year under section

constructively received from controlled

1212(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

foreign corporations under subpart F. This

2. Enter the sum of the amounts from line 22, column (b) (without

amount should equal the total subpart F

regard to wholly owned foreign subsidiary dividends) and line 9,

income reported on Schedule I of Form

5471, Information Return of U.S. Persons

column (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

With Respect to Certain Foreign

3. Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Corporations. These amounts are treated

4. Multiply line 3 by 80% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

as dividends only to the extent provided in

5. Add lines 16, 19, 21, and 22 (without regard to FSC dividends),

the Internal Revenue Code and Treasury

Regulations.

column (b), and the portion of the deduction on line 17, column

(b), that is attributable to dividends received from

Line 12, column (b). Include gross-up

20%-or-more-owned corporations . . . . . . . . . . . . . . . . . . . . . . .

for taxes deemed paid under sections 902

6. Enter the smaller of line 4 or line 5. If line 5 is greater than line 4,

and 960.

stop here; enter the amount from line 6 on line 23, column (b),

Line 13, column (b). Include the

and do not complete the rest of this worksheet . . . . . . . . . . . . .

following.

7. Enter the total amount of dividends received from

1. Dividends (other than capital gain

20%-or-more-owned corporations that are included on lines 2,

distributions reported on Schedule D

3, 5, 7, and 8 (without regard to FSC dividends), column

(Form 1120) and exempt-interest

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

dividends) that are received from RICs

8. Subtract line 7 from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

and that are not subject to the 70%

deduction.

9. Multiply line 8 by 70% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. Dividends from tax-exempt

10. Subtract line 5 from line 23, column (b) (without regard to FSC

organizations.

dividends) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3. Dividends (other than capital gain

11. Enter the smaller of line 9 or line 10 . . . . . . . . . . . . . . . . . . . . . .

distributions) received from a REIT that,

12. Dividends-received deduction after limitation (section

for the tax year of the trust in which the

246(b)). Add lines 6 and 11. Enter the result here and on

dividends are paid, qualifies under

line 23, column (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

sections 856 through 860.

4. Dividends not eligible for a

dividends-received deduction, which

related payments with respect to positions

include the following.

Schedule E—Premiums

in substantially similar or related property.

a. Dividends received on any share of

Earned

5. Any other taxable dividend income

stock held for less than 46 days during the

not properly reported elsewhere on

91-day period beginning 45 days before

Definitions

Schedule C.

the ex-dividend date. When counting the

number of days the corporation held the

Undiscounted unearned premiums.

Line 17. Dividends received on

stock, you cannot count certain days

Undiscounted unearned premiums means

debt-financed stock acquired after July 18,

during which the corporation's risk of loss

the unearned premiums shown in the

1984, are not entitled to the full 70% or

was diminished. See section 246(c)(4)

annual statement filed for the year ending

80% dividends-received deduction. The

and Regulations section 1.246-5 for more

with or in the tax year.

70% or 80% deduction is reduced by a

details.

Applicable interest rate. Applicable

percentage that is related to the amount of

b. Dividends attributable to periods

interest rate means the annual rate

debt incurred to acquire the stock. See

totaling more than 366 days that the

section 246A. Also, see section 245(a)

determined under section 846(c)(2) for the

corporation received on any share of

calendar year the premiums are received.

before making this computation for an

preferred stock held for less than 91 days

additional limitation that applies to

Applicable statutory premium recogni-

during the 181-day period that began 90

dividends received from foreign

tion pattern. Applicable statutory

days before the ex-dividend date. When

corporations. Attach a statement showing

premium recognition pattern means the

counting the number of days the

how the amount on line 17 was figured.

statutory premium recognition pattern in

corporation held the stock, you cannot

effect for the calendar year the premiums

count certain days during which the

Line 23, column (b). Generally, line 23,

column (b), cannot exceed the amount

are received, and is based on the statutory

corporation's risk of loss was diminished.

premium recognition pattern which applies

See section 246(c)(4) and Regulations

from the Worksheet for Schedule C,

to premiums received by the corporation

section 1.246-5 for more details. Preferred

line 23, above. However, in a year in

in that calendar year. For purposes of the

dividends attributable to periods totaling

which an NOL occurs, this limitation does

preceding sentence, premiums received

less than 367 days are subject to the

not apply even if the loss is created by the

dividends-received deduction. See

during any calendar year will be treated as

46-day holding period rule above.

received in the middle of such year.

sections 172(d) and 246(b).

c. Dividends on any share of stock to

the extent the corporation is under an

Medical loss ratio. Section 833(c)(5)

obligation (including a short sale) to make

limits the 100% deduction of unearned

Instructions for Form 1120-PC (2016)

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Instructions For Form 1120-Pc - 2016 Page 18

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