Item 12
power of all classes of stock of the
Schedule L—Balance
corporation entitled to vote, or (b) the total
Enter the amount of the NOL carryover to
value of all classes of stock of the
Sheets per Books
the tax year from prior years, even if
corporation.
some of the loss is used to offset income
Note. All insurance companies required
on this return. The amount to enter is the
The constructive ownership rules of
to file Form 1120-PC must complete
total of all NOLs generated in prior years
section 318 apply in determining if a
Schedule L.
but not used to offset income (either as a
corporation is foreign owned. See section
carryback or carryover) in a tax year prior
The balance sheets should agree with
6038A(c)(5) and the related regulations.
to 2011. Do not reduce the amount by
the corporation’s books and records.
Enter on line 6a the percentage owned
any NOL deduction reported on Schedule
If filing a consolidated return, report
by the foreign person specified in
A, line 36b.
total consolidated assets, liabilities, and
question 6. On line 6b, enter the name of
shareholder’s equity for all corporations
the owner’s country.
Question 13
joining in the return. See Consolidated
Note. If there is more than one
Return on page 5.
A corporation that files Form 1120-PC
25%-or-more foreign owner, complete
must file Schedule UTP (Form 1120) with
Corporations with total assets
lines 6a and 6b for the foreign person with
its income tax return if:
(non-consolidated or consolidated for all
the highest percentage of ownership.
•
The corporation has assets that equal
corporations included within the tax
or exceed $100 million;
Foreign person. The term “foreign
consolidation group) of $10 million or
•
The corporation or a related party
person” means:
more on the last day of the tax year must
•
issued audited financial statements
A foreign citizen or nonresident alien,
complete Schedule M-3 (Form 1120-PC)
•
reporting all or a portion of the
An individual who is a citizen of a U.S.
instead of Schedule M-1. See the
corporation’s operations for all or a
possession (but who is not a U.S. citizen
separate instructions for Schedule M-3
portion of the corporation’s tax year; and
or resident),
(Form 1120-PC) for provisions that also
•
•
The corporation has one or more tax
A foreign partnership,
affect Schedule L.
•
positions that must be reported on
A foreign corporation,
Line 1. Cash. Include certificates of
•
Schedule UTP.
Any foreign estate or trust within the
deposit as cash on this line.
meaning of section 7701(a)(31), or
Line 5. Tax-exempt securities. Include
•
For details, see the Instructions for
A foreign government (or one of its
on this line:
Schedule UTP.
agencies or instrumentalities) to the
•
State and local government obligations,
extent that it is engaged in the conduct of
the interest on which is excludable from
Attach Schedule UTP to the
a commercial activity as described in
gross income under section 103(a), and
corporation’s income tax return. Do not
section 892.
•
Stock in a mutual fund or other RIC that
file it separately. A taxpayer that files a
distributed exempt-interest dividends
Owner’s country. For individuals, the
protective Form 1120-PC must also file
during the tax year of the corporation.
term “owner’s country” means the country
Schedule UTP if it satisfies the
of residence. For all others, it is the
Line 18. Insurance liabilities. Include
requirements set forth above.
country where incorporated, organized,
on this line:
•
created, or administered.
Question 14
Undiscounted unpaid losses.
•
Loss adjustment expenses.
Requirement to file Form 5472. If the
Section 833(c)(5) provides that section
•
Unearned premiums.
corporation checked “Yes” it may have to
833 does not apply to a Blue Cross or
file Form 5472, Information Return of a
See section 846 for more information.
Blue Shield organization described in
25% Foreign-Owned U.S. Corporation or
section 833(c)(2), or other organization
Line 27. Adjustments to shareholders’
a Foreign Corporation Engaged in a U.S.
described in section 833(c)(3), unless it
equity. Some examples of adjustments
Trade or Business. Generally, a 25%
has a medical loss ratio of 85% or more
to report on this line include:
•
foreign-owned corporation that had a
for the tax year.
Unrealized gains and losses on
reportable transaction with a foreign or
securities held “available for sale.”
•
For purposes of section 833(c)(5), the
domestic related party during the tax year
Foreign currency translation
medical loss ratio is equal to the amount
must file Form 5472. See Form 5472 for
adjustments.
•
expended on reimbursement for clinical
filing instructions and penalties for failure
The excess of additional pension
services provided to enrollees (as defined
to file.
liability over unrecognized prior service
in 45 C.F.R. 158.140) under its policies
cost.
Item 10
•
during the tax year (section 833 MLR
Guarantees of employee stock (ESOP)
Numerator) divided by the total premium
Show any tax-exempt interest received or
debt.
•
revenue (section 833 MLR Denominator).
accrued. Include any exempt-interest
Compensation related to employee
See section 833(c)(5) and Notice 2010-79
dividends received as a shareholder in a
stock award plans.
for more information.
mutual fund or other RIC.
If the total adjustment to be entered on
line 27 is a negative amount, enter the
Item 11
Check the “Yes” box if the corporation
amount in parentheses.
is a Blue Cross or Blue Shield
If the corporation has an NOL, it generally
organization described in section
can elect under section 172(b)(3) to waive
833(c)(2), or other organization described
the entire carryback period for the NOL
Schedule M-1—
in section 833(c)(3), that has satisfied the
and instead carry the NOL forward to
Reconciliation of Income
medical loss ratio (MLR) requirements of
future tax years. To do so, check the box
section 833(c)(5).
on line 11 and file the tax return by its due
(Loss) per Books With
date, including extensions. Do not attach
If you checked “No” enter zero on
Income per Return
the statement described in Temporary
Schedule H, line 6, and Schedule A, line
Regulations section 301.9100-12T. Once
All insurance companies required to file
34a. You cannot take the special
made, the election is irrevocable.
Form 1120-PC, with total assets
deduction. See the instructions for
Corporations filing a consolidated
(non-consolidated or consolidated for all
Schedule H.
return that elect to waive the entire
corporations included within the tax
carryback period for the group must also
Also, if you checked “No” your
consolidation group) of $10 million or
attach the statement required by
deduction of unearned premiums is
more on the last day of the tax year must
Regulations section 1.1502-21(b)(3) or
limited. See the instructions for Schedule
complete Schedule M-3 (Form 1120-PC)
the election will not be valid.
E for more information.
instead of Schedule M-1. See Schedule
-19-
Instructions for Form 1120-PC (2011)