What IRS Form 1120-RIC (2015) Is For

IRS Form 1120-RIC (2015) is the U.S. Income Tax Return for Regulated Investment Companies that must be filed by domestic corporations electing to be treated as regulated investment companies (RICs) for the 2015 tax year. RICs include mutual funds, exchange-traded funds (ETFs), and other investment companies that meet specific qualification requirements under Internal Revenue Code section 851 and pass through their investment income to shareholders to avoid double taxation.

When You'd Use Form 1120-RIC for 2015 (Late or Amended Filing)

You would file a late or amended Form 1120-RIC (2015) if your RIC failed to file by the original due date (15th day of the 3rd month after the tax year ended) or received IRS notices regarding unfiled returns, balance due assessments, or audit adjustments requiring amended filings. Late filing scenarios commonly arise when RICs receive CP notices, face penalties for missed deadlines, or discover errors in originally filed returns. Since the refund statute of limitations for 2015 generally expired by 2019, amended returns for that year typically involve paying additional taxes rather than claiming refunds, unless special circumstances apply such as net operating loss carrybacks or bad debt claims.

Key Rules Specific to 2015

For tax years beginning in 2015, the recognition period for built-in gains tax was permanently reduced to 5 years from the previous 10-year period (IRS Instructions for Form 1120-RIC (2015)). This change particularly affected RICs that had converted from C corporation status and held appreciated assets. Additionally, 2015 marked the final implementation year for certain provisions of the RIC Modernization Act of 2010, affecting how RICs could cure asset test failures and income test violations. The fundamental qualification requirements remained consistent: RICs must derive at least 90% of gross income from qualifying sources, maintain proper asset diversification, and distribute at least 90% of investment company taxable income to shareholders annually.

Step-by-Step (High Level)

• Gather Documentation: Obtain account transcripts from IRS.gov or by calling the IRS to understand your RIC's filing history and any penalty assessments for 2015
  
  
• Complete Form 1120-RIC (2015): Use the correct year version available at IRS.gov/prior-year-forms-and-instructions, ensuring all income, deductions, and tax calculations reflect 2015 activity
  
  
• Attach Required Schedules: Include Schedule D for capital gains/losses, Schedule N for controlled group information if applicable, and any other supporting schedules referenced in the instructions
  
  
• File and Pay: Mail to the appropriate IRS service center (Cincinnati, OH for assets under $10 million; Ogden, UT for $10 million or more) following IRS filing procedures
  
  
• Retain Copies: Keep complete copies of the filed return and all supporting documentation for at least three years from the filing date
  
  

Common Mistakes and How to Avoid Them

• Failing Distribution Requirements: Ensure your RIC distributed at least 90% of investment company taxable income plus 90% of tax-exempt interest income (net of related deductions) during 2015, as failure results in C corporation taxation
  
  
• Asset Test Violations: Verify compliance with quarterly asset diversification tests, particularly the 50% and 25% rules for investment concentration, and properly document any reasonable cause exceptions
  
  
• Incorrect Income Classification: Carefully categorize income sources to meet the 90% qualifying income test, ensuring proper treatment of partnership income, securities lending payments, and foreign currency gains
  
  
• Missing Form 8613: File Form 8613 separately if your RIC owes the 4% excise tax on undistributed income under section 4982, which has different due dates than Form 1120-RIC
  
  
• Shareholder Reporting Errors: Ensure Forms 1099-DIV accurately reflect dividend distributions and capital gain distributions to shareholders for 2015, as mismatches can trigger IRS inquiries
  
  
• Schedule K Omissions: Complete all applicable items in Schedule K (Other Information), particularly questions about foreign accounts, reportable transactions, and related party relationships
  
  

What Happens After You File

The IRS typically processes late-filed Form 1120-RIC returns within 6-8 weeks, though complex returns or those requiring manual review may take longer. You'll receive notices confirming receipt and any balance due calculations, including failure-to-file penalties (5% per month up to 25% of unpaid tax) and failure-to-pay penalties (0.5% per month up to 25%). If you disagree with IRS adjustments, you have appeal rights through the IRS Independent Office of Appeals within 30 days of receiving a statutory notice of deficiency. Payment options include full payment, installment agreements using Form 9465, or offers in compromise for qualifying taxpayers experiencing financial hardship.

FAQs

What penalties apply to late-filed 2015 Form 1120-RIC returns?

Failure-to-file penalties are 5% of unpaid tax per month (maximum 25%), plus failure-to-pay penalties of 0.5% per month. The minimum penalty for returns over 60 days late was $135 in 2015, or the full tax amount if smaller (IRS Instructions for Form 1120-RIC (2015)).

Can transcript requests help with late 2015 filings?

Yes, account transcripts show your filing history, penalty assessments, and payment credits. Order them free at IRS.gov to understand your RIC's current account status.

Is there still time to claim 2015 refunds?

Generally no—the three-year refund statute expired in 2019 for 2015 returns. However, certain situations like net operating loss carrybacks or bad debt claims may extend this period under specific Internal Revenue Code provisions.

Do I need to amend state returns after filing late federal returns?

Most states require conforming amendments when federal returns are filed late or amended. Check with each state where your RIC has filing obligations, as deadlines and procedures vary significantly.

What if my RIC failed qualification tests in 2015?

RICs failing income or asset tests may still qualify if failures were due to reasonable cause and corrective actions were taken within specified timeframes (IRS Instructions for Form 1120-RIC (2015)). Document all remedial steps taken.

How do I handle the 4% excise tax for 2015?

File Form 8613 separately if your RIC had undistributed income subject to section 4982 excise tax. This form has different due dates and payment requirements than Form 1120-RIC (IRS Instructions for Form 1120-RIC (2015)).

Can I request penalty relief for reasonable cause?

Yes, submit a written explanation with supporting documentation if the late filing resulted from circumstances beyond your control, such as natural disasters, serious illness, or unavoidable absence of key personnel, as outlined in IRS procedures for reasonable cause determinations.

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