Form 5471 (Rev. 12-2018) Filing Checklist
Purpose and Overview
Form 5471 serves as the information return that U.S. persons file to report ownership interests in foreign corporations. Significant changes from the Tax Cuts and Jobs Act appear in the December 2018 revision, including new reporting requirements for Global Intangible Low-Taxed Income and foreign-derived intangible income deductions under Section 250.
Filers must prepare financial statements in the foreign corporation's functional currency in accordance with U.S. generally accepted accounting principles. Detailed schedules covering stock ownership, shareholder information, income statements, balance sheets, and related-party transactions with controlled foreign corporations are required for the form.
Filing Category Determination
You must first confirm your filer category under Section B of the form, as Categories 1 through 5 determine which schedules you are required to complete. U.S. persons who had control of a foreign corporation during the annual accounting period qualify as Category 4 filers. Category 5 filers encompass U.S. shareholders who own stock in a foreign corporation that qualifies as a controlled foreign corporation at any time during the tax year.
Multiple categories may apply to a single filer, requiring completion of all applicable schedules without duplicating information. Joint filing remains available when various persons share identical filing requirements for the same foreign corporation.
Basic Identifying Information
Enter the foreign corporation’s functional currency on line 1h of page one. Corporations using a non-U.S. dollar functional currency must complete financial schedules in both the functional currency and U.S. dollars, translated in accordance with U.S. Generally Accepted Accounting Principles (GAAP) translation rules.
The Dollar Approximate Separate Transactions Method applies to hyperinflationary countries under specific conditions. Report the voting stock ownership percentage at year-end on line C, ensuring accuracy for filers claiming foreign-derived intangible income deductions who must verify ownership thresholds align with intangible income eligibility computations.
This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
Stock and Shareholder Reporting
Complete Schedule A by providing stock descriptions and share counts for each class of stock the foreign corporation issued. Class descriptions entered in Schedule A must match exactly with descriptions you report in Schedule B Part II for direct shareholders. Schedule B consists of two distinct parts that serve different reporting purposes.
Part I requires information about U.S. shareholders of the foreign corporation for Category 3 and Category 4 filers. Part II collects data about direct shareholders regardless of whether they qualify as U.S. persons, supporting the 2018 form’s enhanced transparency requirements for ownership structures.
Financial Statement Preparation
Schedule C contains the income statement covering lines 1 through 24, which you must prepare in functional currency and U.S. dollars. Lines 8a and 8b represent new additions for the 2018 revision that separately identify foreign currency transaction gains and losses as unrealized and realized amounts. Line 20 captures unusual items or infrequently occurring transactions, as per the updated structure reflecting post-Tax Cuts and Jobs Act accounting transparency.
Schedule F presents the balance sheet for both the beginning and end of the accounting period across lines 1 through 24. Lines 3 and 17 of Schedule F require separate reporting of derivatives, a requirement added in 2018 to reflect Section 965 treatment of derivatives as cash equivalents.
Schedule G Information Questions
Schedule G contains a series of information questions numbered 1 through 19 that address various tax provisions and reporting obligations. Base erosion payments under Section 59A appear in Question 4, which entered into force for 2018 tax years as part of the base erosion and anti-abuse tax regime. You must complete lines 4b and 4c if the filer paid or accrued any base erosion payments to the foreign corporation or received base erosion tax benefits.
Section 267A interest and royalty disallowance provisions enacted December 22, 2017, are covered in Question 5, which first applies to taxable years beginning after December 31, 2017. Complete line 5b when the foreign corporation paid or accrued disqualified interest or royalties under the hybrid arrangement limitation rules. Question 6a asks whether the filer claims a foreign-derived intangible income deduction under Section 250 with respect to amounts listed on Schedule M.
Schedule I Shareholder Income Summary
Category 4 and Category 5 filers must complete separate Schedule I forms for each person identified in Item F of page one. Each Schedule I reports the shareholder's income from the foreign corporation across lines 1a through 4. Section 964(e)(4) subpart F dividend income from sales of lower-tier foreign corporation stock appears on line 1a.
Hybrid dividends of tiered corporations generate Section 245A(e)(2) subpart F income that you report on line 1b. Other Subpart F income, calculated using Worksheet A from the instructions, should be reported on line 1c. Earnings invested in U.S. property determined through Worksheet B calculations require reporting on line 2.
Required Statement Attachments
Attach Schedule M for each controlled foreign corporation to report transactions between the corporation and related parties. Schedule M requires separate completion regardless of how many other schedules you file. Lines 9 and 22 of Schedule M capture hybrid dividends received and paid, in accordance with the requirements of Section 14101(e) of the Act.
All required statements must accompany the form, including documentation for base erosion and anti-abuse tax matters, foreign-derived intangible income deduction claims, cost-sharing arrangements, triangular reorganizations, Section 367(d) earnings reductions, expatriated foreign subsidiary status, reportable transactions, Section 909 foreign tax suspension events, and Schedule G line 19 coded items. Category 4 and Category 5 filers must also complete Schedule H, Schedule H-1, Schedule I-1, Schedule J, and Schedule O when reporting earnings and profits, deemed paid credits, and previously taxed earnings.
Foreign-controlled controlled foreign corporations and foreign-controlled specified foreign corporations follow the exact attachment requirements. You must file Form 5471 and all applicable schedules with your income tax return by the due date, including extensions.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
