Filling out an IRS Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business and feeling lost? Wondering if you have to file at all?
If so, let us help you!
Who Must File Form 5472?
Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade of Business, must be filed by a reporting corporation if any reportable transactions with a foreign or domestic related party occurred
Exceptions
A reporting corporation does not need to file Form 5472 if:
- It had no reportable transactions
- Form 5471, including Schedule M, is filed by a U.S. person with control of the related foreign corporation.
- Foreign-owned U.S. disregarded entities are not eligible
- The related corporation filed Form 1120-FSC
- The reporting corporation is foreign and does not meet the permanent establishment criteria set forth in an applicable income tax treaty
- The treaty position (Form 8833) must be filed
- The foreign corporation is exempt from taxation under sectino 883 and 887 of the tax code
- Neither the reporting corporation nor the related party are U.S. persons and the transactions does not generate U.S. effectively connected income or expenses deducted from such income
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