Instructions For Form 926 (Page 2 of 3) in pdf

Line 1c

undisclosed foreign financial asset

year. The reference ID number must meet

understatement. No penalty will be

the requirements set forth below.

If the transferor was a member of an

imposed with respect to any portion of an

affiliated group filing a consolidated tax

Note. Because reference ID numbers are

underpayment if the taxpayer can

return (see sections 1501 through 1504),

established by or on behalf of the U.S.

demonstrate that the failure to comply was

but was not the parent corporation, list the

person filing Form 926, there is no need to

due to reasonable cause with respect to

name and EIN of the parent corporation

apply to the IRS to request a reference ID

such portion of the underpayment and the

and file Form 926 with the parent

number or for permission to use these

taxpayer acted in good faith with respect

corporation's consolidated return.

numbers.

to such portion of the underpayment. See

Line 1d

sections 6662(j) and 6664(c) for additional

Note. In general, the reference ID

information.

If the answer to line 1d is "Yes," and if the

number assigned to a transferee foreign

asset is transferred in an exchange

corporation on Form 926 has relevance

Specific Instructions

described in section 361(a) or (b), attach

only to Form 926 and should not be used

the following:

with respect to the transferee foreign

Important: All information reported on

A statement that the conditions set forth

corporation on other IRS forms.

Form 926 must be in English. All amounts

in the second sentence of section 367(a)

Requirements. The reference ID number

must be stated in U.S. dollars. If the

(5) and any regulations under that section

must be alphanumeric (defined below)

information required in a given section

have been satisfied.

and no special characters or spaces are

exceeds the space provided within that

An explanation of any basis or other

permitted. The length of a given reference

section, do not write “see attached” in the

adjustments made pursuant to section

ID number is limited to 50 characters.

section and then attach all of the

367(a)(5) and any regulations thereunder.

information on additional sheets. Instead,

For these purposes, the term

Line 2

complete all entry spaces in the section

“alphanumeric” means the entry can be

and attach the remaining information on

If a partnership (whether foreign or

alphabetical, numeric, or any combination

additional sheets. The additional sheets

domestic) transfers property to a foreign

of the two.

must conform with the IRS version of that

corporation in an exchange described in

The same reference ID number must

section.

section 367(a)(1), then a U.S. person that

be used consistently from tax year to tax

is a partner in the partnership shall be

year with respect to a given transferee

Part I—U.S. Transferor

treated as having transferred a

foreign corporation. If for any reason a

Information

proportionate share of the property in an

reference ID number falls out of use (for

exchange described in section 367(a)(1).

example, the transferee foreign

Identifying Number

A U.S. person's proportionate share of

corporation no longer exists due to

partnership property shall be determined

disposition or liquidation), the reference ID

The identifying number of an individual is

under the rules and principles of sections

number used for that transferee foreign

his or her social security number (SSN).

701 through 761 and the regulations

The identifying number of all others is their

corporation cannot be used again for

thereunder. See Temporary Regulations

employer identification number (EIN).

another transferee foreign corporation for

section 1.367(a)-1T(c)(3).

purposes of Form 926 reporting.

Line 2d. For definition of “regularly traded

There are some situations that warrant

Line 1a

on an established securities market,” see

correlation of a new reference ID number

If you answered “Yes” to question 1a and

Temporary Regulations section

with a previous reference ID number when

the asset is a tangible asset, section

1.367(a)-1T(c)(3)(ii)(D). If the answer to

assigning a new reference ID number to a

367(a)(5) may require basis adjustments.

line 2d is “Yes,” the rules of Regulations

transferee foreign corporation. For

If you answered “No” to question 1a and

section 1.367(a)-1T(c)(3)(ii)(C) apply.

example:

the asset is a tangible asset, the transfer is

In the case of a merger or acquisition, a

Part II—Transferee

taxable under sections 367(a)(1) and (a)

Form 926 filer must use a reference ID

(5). If the asset transferred is an intangible

Foreign Corporation

number which correlates the previous

asset, see section 367(d) and its

reference ID number with the new

Information

regulations.

reference ID number assigned to the

If you answered “No” to question 1a: If

transferee foreign corporation.

Reference ID number. A reference ID

the U.S. transferor is owned directly by

In the case of an entity classification

number is required on line 4b only in

more than five domestic corporations

election that is made on behalf of a

cases where no EIN was entered on

immediately before the reorganiztion, but

transferee foreign corporation on Form

line 4a for the transferee foreign

some combination of five or fewer

8832, Regulations section 301.6109-1(b)

corporation. However, filers are permitted

domestic corporations controls the U.S.

(2)(v) requires the transferee foreign

to enter both an EIN and a reference ID

transferor, the U.S. transferor must

corporation to have an EIN for this

number. If applicable, enter on line 4b the

designate the five or fewer domestic

election. For the first year that Form 926 is

reference ID number (defined below) you

corporations that comprise the control

filed after an entity classification election is

have assigned to the transferee foreign

group. List these designated corporations

made on behalf of the transferee foreign

corporation.

on Form 926, line 1b.

corporation on Form 8832, the new EIN

A “reference ID number” is a number

Line 1b

must be entered on line 4a and the old

established by or on behalf of the U.S.

reference ID number must be entered on

If the transferor went out of existence

transferor identified at the top of page 1 of

line 4b. In subsequent years, the Form

pursuant to the transfer (e.g., as in a

the form that is assigned to the transferee

926 filer may continue to enter both the

reorganization described in section 368(a)

foreign corporation with respect to which

EIN and the reference ID number, but

(1)(C)), list the controlling shareholders

Form 926 reporting is required. These

must enter at least the EIN on line 4a.

and their identifying numbers.

numbers are used to uniquely identify the

You must correlate the reference ID

transferee foreign corporation in order to

numbers as follows: New reference ID

keep track of the entity from tax year to tax

number [space] Old reference ID number.

-2-

Instructions For Form 926 Page 2

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