The IRS 1120 form is a tax return used by corporations to report their income, gains, losses, deductions, and credits to the Internal Revenue Service. This form is essential for C corporations, as it outlines their financial activities for the tax year. Understanding how to complete the 1120 form accurately is crucial for compliance and effective tax planning.
The IRS 1120 form is a crucial document for corporations operating in the United States, serving as the annual income tax return for these entities. It requires detailed reporting of a corporation's income, gains, losses, deductions, and credits, which ultimately determine the tax liability owed to the federal government. Corporations must provide information such as the total revenue generated during the tax year, the cost of goods sold, and operating expenses. Additionally, the form includes sections for reporting dividends, interest income, and other forms of income that contribute to the overall financial picture of the business. Corporations must also disclose any tax credits they are eligible for, which can significantly reduce their tax burden. Filing the IRS 1120 form accurately and on time is essential for compliance with federal tax laws, and it can also impact a corporation’s ability to secure financing or attract investors. Understanding the nuances of this form is vital for corporate officers and accountants alike, as errors or omissions can lead to penalties or audits.
Form 1120
Department of the Treasury
Internal Revenue Service
A Check if:
1a Consolidated return (attach Form 851) .
b Life/nonlife consoli- dated return . . .
2Personal holding co. (attach Sch. PH) . .
3Personal service corp. (see instructions) . .
4 Schedule M-3 attached
U.S. Corporation Income Tax Return
OMB No. 1545-0123
For calendar year 2021 or tax year beginning
, 2021, ending
, 20
2021
▶ Go to www.irs.gov/Form1120 for instructions and the latest information.
Name
B Employer identification number
TYPE
Number, street, and room or suite no. If a P.O. box, see instructions.
C Date incorporated
OR
PRINT
City or town, state or province, country, and ZIP or foreign postal code
D Total assets (see instructions)
$
E Check if: (1)
Initial return
(2)
Final return
(3)
Name change
(4)
Address change
1a
Gross receipts or sales
. . .
.
b
Returns and allowances
1b
c
Balance. Subtract line 1b from line 1a
. . . . . . . . . . . .
1c
2
Cost of goods sold (attach Form 1125-A)
3
Gross profit. Subtract line 2 from line 1c
Income
4
Dividends and inclusions (Schedule C, line 23)
5
Interest
. . . . . . . . . . . . . . . . . .
6
Gross rents
7
Gross royalties
8
Capital gain net income (attach Schedule D (Form 1120)) . . . .
9
Net gain or (loss) from Form 4797, Part II, line 17 (attach Form 4797)
10
Other income (see instructions—attach statement)
11
Total income. Add lines 3 through 10
. .
▶
deductions.)
12
Compensation of officers (see instructions—attach Form 1125-E) .
13
Salaries and wages (less employment credits)
14
Repairs and maintenance
15
Bad debts
on
16
Rents
17
Taxes and licenses
limitations
20
Depreciation from Form 4562 not claimed on Form 1125-A or elsewhere on return (attach Form 4562) . . .
18
Interest (see instructions)
19
Charitable contributions
for
21
Depletion
instructions
25
Reserved for future use
22
Advertising
23
Pension, profit-sharing, etc., plans
. . . . . . . . . .
24
Employee benefit programs
(See
26
Other deductions (attach statement)
Deductions
27
Total deductions. Add lines 12 through 26
28
Taxable income before net operating loss deduction and special deductions. Subtract line 27 from line 11. .
29a
Net operating loss deduction (see instructions)
Special deductions (Schedule C, line 24)
29b
Add lines 29a and 29b
29c
and
30
Taxable income. Subtract line 29c from line 28. See instructions .
31
Total tax
(Schedule J, Part I, line 11)
Credits,Refundable Payments
32
33
Total payments and credits (Schedule J, Part III, line 23) . . . .
34
Estimated tax penalty. See instructions. Check if Form 2220 is attached
. ▶
35
Amount owed. If line 33 is smaller than the total of lines 31 and 34, enter amount owed
. . . . . .
Tax,
36
Overpayment. If line 33 is larger than the total of lines 31 and 34, enter amount overpaid
37
Enter amount from line 36 you want: Credited to 2022 estimated tax ▶
Refunded ▶
Sign
Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct,
and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.
May the IRS discuss this return
Here
with the preparer shown below?
See instructions.
Yes
No
▲Signature of officer
Date
▲
Title
Paid
Print/Type preparer’s name
Preparer’s signature
Check
if
PTIN
Preparer
self-employed
Firm’s name ▶
Firm’s EIN ▶
Use Only
Firm’s address ▶
Phone no.
For Paperwork Reduction Act Notice, see separate instructions.
Cat. No. 11450Q
Form 1120 (2021)
Page 2
Schedule C
Dividends, Inclusions, and Special Deductions (see
(a) Dividends and
(b) %
(c) Special deductions
instructions)
inclusions
(a) × (b)
1Dividends from less-than-20%-owned domestic corporations (other than debt-financed
stock)
50
2Dividends from 20%-or-more-owned domestic corporations (other than debt-financed
65
See
Dividends on certain debt-financed stock of domestic and foreign corporations . .
Dividends on certain preferred stock of less-than-20%-owned public utilities . . .
23.3
Dividends on certain preferred stock of 20%-or-more-owned public utilities . . . .
26.7
Dividends from less-than-20%-owned foreign corporations and certain FSCs . . .
Dividends from 20%-or-more-owned foreign corporations and certain FSCs . . .
Dividends from wholly owned foreign subsidiaries
100
Subtotal. Add lines 1 through 8. See instructions for limitations
10Dividends from domestic corporations received by a small business investment
company operating under the Small Business Investment Act of 1958
Dividends from affiliated group members
Dividends from certain FSCs
13Foreign-source portion of dividends received from a specified 10%-owned foreign
corporation (excluding hybrid dividends) (see instructions)
Dividends from foreign corporations not included on line 3, 6, 7, 8, 11, 12, or 13
(including any hybrid dividends)
16a
Subpart F inclusions derived from the sale by a controlled foreign corporation (CFC) of
the stock of a lower-tier foreign corporation treated as a dividend (attach Form(s) 5471)
(see instructions)
Subpart F inclusions derived from hybrid dividends of tiered corporations (attach Form(s)
5471) (see instructions)
Other inclusions from CFCs under subpart F not included on line 16a, 16b, or 17 (attach
Form(s) 5471) (see instructions)
Global Intangible Low-Taxed Income (GILTI) (attach Form(s) 5471 and Form 8992) . .
Gross-up for foreign taxes deemed paid
IC-DISC and former DISC dividends not included on line 1, 2, or 3
Other dividends
Deduction for dividends paid on certain preferred stock of public utilities . . . .
Section 250 deduction (attach Form 8993)
23Total dividends and inclusions. Add column (a), lines 9 through 20. Enter here and on page 1, line 4 . . . . . . . . . . . . . . . . . . . . . .
Total special deductions. Add column (c), lines 9 through 22. Enter here and on page 1, line 29b
Page 3
Schedule J
Tax Computation and Payment (see instructions)
Part I—Tax Computation
1
Check if the corporation is a member of a controlled group (attach Schedule O (Form 1120)). See instructions
Income tax. See instructions
. . . .
Base erosion minimum tax amount (attach Form 8991)
Add lines 2 and 3
5a
Foreign tax credit (attach Form 1118)
Credit from Form 8834 (see instructions)
5b
General business credit (attach Form 3800)
5c
d
Credit for prior year minimum tax (attach Form 8827)
5d
e
Bond credits from Form 8912
5e
Total credits. Add lines 5a through 5e
Subtract line 6 from line 4
Personal holding company tax (attach Schedule PH (Form 1120))
9a
Recapture of investment credit (attach Form 4255)
Recapture of low-income housing credit (attach Form 8611)
9b
Interest due under the look-back method—completed long-term contracts (attach
Form 8697)
9c
Interest due under the look-back method—income forecast method (attach Form 8866)
9d
Alternative tax on qualifying shipping activities (attach Form 8902)
9e
f
Interest/tax due under section 453A(c) and/or section 453(l)
9f
g
Other (see instructions—attach statement)
9g
Total. Add lines 9a through 9g
Total tax. Add lines 7, 8, and 10. Enter here and on page 1, line 31
Part II—Reserved For Future Use
12 Reserved for future use . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part III—Payments and Refundable Credits
2020 overpayment credited to 2021
. . . . . . . .
2021 estimated tax payments
2021 refund applied for on Form 4466
(
)
Combine lines 13, 14, and 15
Tax deposited with Form 7004
Withholding (see instructions)
Total payments. Add lines 16, 17, and 18
Refundable credits from:
a
Form 2439
20a
Form 4136
20b
20c
Other (attach statement—see instructions)
20d
Total credits. Add lines 20a through 20d
Total payments and credits. Add lines 19 and 21. Enter here and on page 1, line 33 .
Page 4
Schedule K Other Information (see instructions)
Check accounting method: a
Cash
Accrual
Other (specify) ▶
2See the instructions and enter the: a Business activity code no. ▶
b Business activity ▶ c Product or service ▶
3 Is the corporation a subsidiary in an affiliated group or a parent–subsidiary controlled group? . . . . . . . . . .
If “Yes,” enter name and EIN of the parent corporation ▶
4At the end of the tax year:
aDid any foreign or domestic corporation, partnership (including any entity treated as a partnership), trust, or tax-exempt organization own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of the
corporation’s stock entitled to vote? If “Yes,” complete Part I of Schedule G (Form 1120) (attach Schedule G) . . . . . .
bDid any individual or estate own directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all
classes of the corporation’s stock entitled to vote? If “Yes,” complete Part II of Schedule G (Form 1120) (attach Schedule G) .
5At the end of the tax year, did the corporation:
aOwn directly 20% or more, or own, directly or indirectly, 50% or more of the total voting power of all classes of stock entitled to vote of any foreign or domestic corporation not included on Form 851, Affiliations Schedule? For rules of constructive ownership, see instructions. If “Yes,” complete (i) through (iv) below.
Yes No
(i)Name of Corporation
(ii)Employer
Identification Number
(if any)
(iii)Country of Incorporation
(iv)Percentage Owned in Voting
Stock
bOwn directly an interest of 20% or more, or own, directly or indirectly, an interest of 50% or more in any foreign or domestic partnership (including an entity treated as a partnership) or in the beneficial interest of a trust? For rules of constructive ownership, see instructions. If “Yes,” complete (i) through (iv) below.
(i)Name of Entity
(iii)Country of Organization
(iv)Maximum
Percentage Owned in Profit, Loss, or Capital
6During this tax year, did the corporation pay dividends (other than stock dividends and distributions in exchange for stock) in
excess of the corporation’s current and accumulated earnings and profits? See sections 301 and 316 . . . . . . . .
If “Yes,” file Form 5452, Corporate Report of Nondividend Distributions. See the instructions for Form 5452. If this is a consolidated return, answer here for the parent corporation and on Form 851 for each subsidiary.
7At any time during the tax year, did one foreign person own, directly or indirectly, at least 25% of the total voting power of all classes of the corporation’s stock entitled to vote or at least 25% of the total value of all classes of the corporation’s stock? .
For rules of attribution, see section 318. If “Yes,” enter:
(a) Percentage owned ▶
and (b) Owner’s country ▶
(c)The corporation may have to file Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business. Enter the number of Forms 5472 attached ▶
8 Check this box if the corporation issued publicly offered debt instruments with original issue discount . . . . . . ▶ If checked, the corporation may have to file Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments.
9Enter the amount of tax-exempt interest received or accrued during the tax year ▶ $
10Enter the number of shareholders at the end of the tax year (if 100 or fewer) ▶
11If the corporation has an NOL for the tax year and is electing to forego the carryback period, check here (see instructions) ▶
If the corporation is filing a consolidated return, the statement required by Regulations section 1.1502-21(b)(3) must be attached or the election will not be valid.
12Enter the available NOL carryover from prior tax years (do not reduce it by any deduction reported on
page 1, line 29a.) . . . . . . . . . . . . . . . . . . . . . . . . . ▶ $
Page 5
Schedule K Other Information (continued from page 4)
Are the corporation’s total receipts (page 1, line 1a, plus lines 4 through 10) for the tax year and its total assets at the end of the
tax year less than $250,000?
If “Yes,” the corporation is not required to complete Schedules L, M-1, and M-2. Instead, enter the total amount of cash
distributions and the book value of property distributions (other than cash) made during the tax year ▶ $
Is the corporation required to file Schedule UTP (Form 1120), Uncertain Tax Position Statement? See instructions . . . .
If “Yes,” complete and attach Schedule UTP.
15a
Did the corporation make any payments in 2021 that would require it to file Form(s) 1099?
If “Yes,” did or will the corporation file required Form(s) 1099?
16During this tax year, did the corporation have an 80%-or-more change in ownership, including a change due to redemption of its
own stock? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17During or subsequent to this tax year, but before the filing of this return, did the corporation dispose of more than 65% (by value)
of its assets in a taxable, non-taxable, or tax deferred transaction? . . . . . . . . . . . . . . . . . .
18Did the corporation receive assets in a section 351 transfer in which any of the transferred assets had a fair market basis or fair
market value of more than $1 million? . . . . . . . . . . . . . . . . . . . . . . . . . . .
19During the corporation’s tax year, did the corporation make any payments that would require it to file Forms 1042 and 1042-S under chapter 3 (sections 1441 through 1464) or chapter 4 (sections 1471 through 1474) of the Code? . . . . . . . .
20 Is the corporation operating on a cooperative basis?. . . . . . . . . . . . . . . . . . . . . . .
21During the tax year, did the corporation pay or accrue any interest or royalty for which the deduction is not allowed under section
267A? See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
If “Yes,” enter the total amount of the disallowed deductions ▶ $
22Does the corporation have gross receipts of at least $500 million in any of the 3 preceding tax years? (See sections 59A(e)(2)
and (3)) .
If “Yes,” complete and attach Form 8991.
23Did the corporation have an election under section 163(j) for any real property trade or business or any farming business in effect
during the tax year? See instructions
Does the corporation satisfy one or more of the following? See instructions
aThe corporation owns a pass-through entity with current, or prior year carryover, excess business interest expense.
bThe corporation’s aggregate average annual gross receipts (determined under section 448(c)) for the 3 tax years preceding the current tax year are more than $26 million and the corporation has business interest expense.
cThe corporation is a tax shelter and the corporation has business interest expense. If “Yes,” complete and attach Form 8990.
Is the corporation attaching Form 8996 to certify as a Qualified Opportunity Fund?
If “Yes,” enter amount from Form 8996, line 15 . . . . ▶ $
26Since December 22, 2017, did a foreign corporation directly or indirectly acquire substantially all of the properties held directly or indirectly by the corporation, and was the ownership percentage (by vote or value) for purposes of section 7874 greater than 50% (for example, the shareholders held more than 50% of the stock of the foreign corporation)? If “Yes,” list the ownership
percentage by vote and by value. See instructions . . . . . . . . . . . . . . . . . . . . . . .
Percentage: By Vote
By Value
Page 6
Schedule L
Balance Sheets per Books
Beginning of tax year
End of tax year
Assets
(a)
(b)
(c)
(d)
2a
Trade notes and accounts receivable . . .
Less allowance for bad debts . .
Inventories
U.S. government obligations
. . . . .
Tax-exempt securities (see instructions) . .
Other current assets (attach statement) . .
Loans to shareholders
Mortgage and real estate loans
Other investments (attach statement) . . .
10a
Buildings and other depreciable assets . .
Less accumulated depreciation . .
11a
Depletable assets
Less accumulated depletion . . .
Land (net of any amortization)
13a
Intangible assets (amortizable only)
Less accumulated amortization . .
Other assets (attach statement)
Total assets
Liabilities and Shareholders’ Equity
Accounts payable
Mortgages, notes, bonds payable in less than 1 year
Other current liabilities (attach statement) . .
Loans from shareholders
Mortgages, notes, bonds payable in 1 year or more
Other liabilities (attach statement) . . . .
Capital stock:
a Preferred stock . . . .
b Common stock . . . .
Additional paid-in capital
Retained earnings—Appropriated (attach statement)
Retained earnings—Unappropriated . . .
Adjustments to shareholders’ equity (attach statement)
Less cost of treasury stock
Total liabilities and shareholders’ equity . .
Schedule M-1 Reconciliation of Income (Loss) per Books With Income per Return
Note: The corporation may be required to file Schedule M-3. See instructions.
Net income (loss) per books
Income recorded on books this year
Federal income tax per books
not included on this return (itemize):
Excess of capital losses over capital gains .
Tax-exempt interest $
4Income subject to tax not recorded on books this year (itemize):
Deductions on this return not charged
Expenses recorded on books this year not
against book income this year (itemize):
deducted on this return (itemize):
Depreciation . . $
Depreciation . . . . $
Charitable contributions $
bCharitable contributions . $
cTravel and entertainment . $
Add lines 7 and 8
Add lines 1 through 5
Income (page 1, line 28)—line 6 less line 9
Schedule M-2 Analysis of Unappropriated Retained Earnings per Books (Schedule L, Line 25)
Balance at beginning of year
Distributions: a Cash
b Stock . . . .
Other increases (itemize):
c Property . . . .
Other decreases (itemize):
Add lines 5 and 6
Add lines 1, 2, and 3
Balance at end of year (line 4 less line 7)
The IRS Form 1120 is the U.S. Corporation Income Tax Return, which corporations use to report their income, gains, losses, deductions, and credits. Along with this form, several other documents may be required to ensure a comprehensive and accurate tax filing. Below is a list of common forms and documents that are often used in conjunction with the IRS 1120 form.
Understanding these additional forms and documents is essential for ensuring that the IRS Form 1120 is completed accurately. Each document plays a vital role in providing a complete picture of the corporation's financial activities, helping to avoid potential issues with tax compliance.
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Filling out the IRS 1120 form can seem daunting, but understanding its key components can make the process smoother. Here are some important takeaways to keep in mind:
By keeping these points in mind, you can navigate the IRS 1120 form with greater confidence.
The IRS Form 1120 is the U.S. Corporation Income Tax Return. It is used by corporations to report their income, gains, losses, deductions, and credits, as well as to calculate their federal income tax liability. This form is crucial for C corporations, which are taxed separately from their owners.
Generally, any corporation that is classified as a C corporation must file Form 1120. This includes:
Additionally, if a corporation has made an election to be treated as a C corporation for tax purposes, it must also file this form.
Form 1120 is typically due on the 15th day of the fourth month after the end of the corporation's tax year. For corporations that operate on a calendar year, this means the due date is April 15. If the due date falls on a weekend or holiday, the deadline is extended to the next business day.
When completing Form 1120, you will need to provide various pieces of information, including:
Accurate reporting is essential to ensure compliance and avoid penalties.
Yes, Form 1120 can be e-filed. The IRS encourages electronic filing as it can speed up processing times and reduce errors. Many tax software programs offer e-filing options, making it easier for corporations to submit their returns electronically.
If a corporation fails to file Form 1120 by the due date, it may face penalties. The IRS imposes a penalty for failure to file, which can be a percentage of the unpaid tax. Additionally, interest accrues on any unpaid tax from the due date until it is paid in full. It is important for corporations to file on time to avoid these financial consequences.
For more information about Form 1120, the IRS website is a valuable resource. There, you can find the form itself, instructions for completing it, and additional resources related to corporate taxation. Consulting with a tax professional can also provide personalized guidance based on your corporation’s specific circumstances.
The IRS Form 1120 is an important document for corporations in the United States, but there are several misconceptions surrounding it. Here are eight common misunderstandings about the form, along with clarifications:
Understanding these misconceptions can help corporations navigate their tax responsibilities more effectively. It is always a good idea to consult a tax professional for personalized guidance.