What IRS Form 1120-PC (2018) Is For

Form 1120-PC is the specialized tax return used by property and casualty insurance companies to report income, gains, losses, deductions, and credits, and to calculate their federal income tax liability (IRS Instructions for Form 1120-PC (2018)). Every domestic nonlife insurance company and foreign corporations that would qualify as nonlife insurance companies under section 831 must file this form instead of the standard corporate Form 1120.

When You'd Use Form 1120-PC for 2018 (Late or Amended Filing)

You would typically file a late 2018 Form 1120-PC if you received IRS notices about an unfiled return, discovered you owed additional taxes, or need to correct errors from the original filing. The original due date was April 15, 2019, for calendar year corporations (or the 15th day of the 4th month after the tax year ended). Late filing results in penalties of 5% of unpaid tax per month up to 25% maximum, with a minimum penalty of $210 for returns over 60 days late (IRS Instructions for Form 1120-PC (2018)). You may also file an amended return if you discover errors or omissions after the original filing, or if tax law changes affect your liability. The statute of limitations for claiming refunds generally expires three years after the original filing date.

Key Rules Specific to 2018

The 2018 tax year introduced significant changes under the Tax Cuts and Jobs Act. The corporate tax rate was reduced to a flat 21% of taxable income. The alternative minimum tax was repealed for corporations, and companies could treat prior-year AMT credits as partially refundable. Section 847 special estimated tax payments were repealed, and the domestic production activities deduction was eliminated. New provisions included the base erosion anti-abuse tax (BEAT), global intangible low-taxed income (GILTI) inclusions, and foreign-derived intangible income (FDII) deductions. Property and casualty companies also faced modified proration rules under section 832(b)(5)(B) (IRS Instructions for Form 1120-PC (2018)).

Step-by-Step (High Level)

• Gather tax records and transcripts - Obtain wage and earnings transcripts from the IRS and compile all 2018 income, expense, and deduction documentation
  
  
• Complete the correct 2018 form - Use only the 2018 version of Form 1120-PC with its specific schedules and requirements
  
  
• Include required NAIC annual statement - Property and casualty companies must attach their NAIC annual statement or pro forma statement with the return
  
  
• Calculate specialized insurance deductions - Complete insurance-specific schedules for reserves, underwriting income, and investment income computations
  
  
• File electronically or by mail - Submit to Department of the Treasury, Internal Revenue Service, Ogden, UT 84201-0012, with all supporting schedules attached in the specified order
  
  
• Keep complete copies - Retain all filed documents and supporting records for at least three years
  
  

Common Mistakes and How to Avoid Them

• Missing NAIC annual statement - Always include the required NAIC annual statement or pro forma statement, as failure to attach it can result in late filing penalties even if the return is timely filed
  
  
• Using wrong tax year forms - Ensure you're using the 2018 version of Form 1120-PC and its schedules, not current year forms, as tax rules and form layouts change annually
  
  
• Incorrect reserve calculations - Property and casualty companies must carefully compute loss reserves and unearned premium reserves following specific insurance accounting rules that differ from general corporate accounting
  
  
• Overlooking new 2018 provisions - Don't forget to consider BEAT, GILTI, FDII, and other Tax Cuts and Jobs Act changes that may apply to your company's specific situation
  
  
• Electronic filing requirement violations - Large corporations required to e-file must also e-file amended returns; paper filing is only allowed with specific IRS waivers
  
  
• Incomplete Schedule M-3 filing - Companies with $10 million or more in total assets must file Schedule M-3 instead of Schedule M-1 for book-to-tax reconciliation
  
  

What Happens After You File

The IRS typically processes returns within several weeks to months, though amended returns may take longer. You'll receive acknowledgment of electronic filings immediately, while paper returns may take 6-8 weeks for initial processing. If you owe additional taxes, you can request an installment agreement using Form 9465 to pay the balance over time rather than in a lump sum (IRS About Form 9465). The IRS may send notices requesting additional information or proposing changes to your return. If you disagree with any IRS determination, you have appeal rights and can request a conference with the IRS Appeals Office. Interest and penalties continue to accrue on unpaid balances until fully resolved, so it's important to address any issues promptly.

FAQs

Can I still get a refund if I file my 2018 return late?

Yes, but you must file within three years of the original due date (April 15, 2022, for most 2018 returns) to claim any refund. There's no penalty for filing late if you're due a refund.

How are penalties calculated for late filing of Form 1120-PC?

The penalty is 5% of unpaid tax per month or partial month, up to 25% maximum. For returns more than 60 days late, the minimum penalty is the smaller of $210 or the total tax due (IRS Instructions for Form 1120-PC (2018)).

Do I need to get tax transcripts before filing an amended return?

While not required, obtaining account transcripts helps ensure you have complete information about prior filings, payments, and any IRS adjustments before preparing your amended return.

What's the difference between a superseding and amended return?

A superseding return is filed within the original filing period (including extensions) and completely replaces the original. An amended return is filed after the deadline expires and shows changes to the original filing (IRS Amended and Superseding Corporate Returns).

Should I also amend my state insurance company returns?

Generally yes, state returns should be amended to conform with federal changes, but requirements vary by state. Check with your state's insurance department or tax authority for specific procedures.

Can I file Form 1120-PC electronically for 2018?

Yes, if your company was required to e-file originally, you must also e-file any amended returns. However, if 2018 forms are no longer available in the electronic system, you may paper file without requesting a waiver (IRS Amended and Superseding Corporate Returns).

How long should I keep records after filing a late return?

Keep all supporting documents for at least three years from the filing date, or longer if you have unreported income or filed a fraudulent return. Insurance companies should also retain records to support reserve calculations and NAIC statement reconciliations (IRS Instructions for Form 1120-PC (2018)).

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