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Form 5471: information return for foreign corporations

Form 5471 is the information return for U.S. persons with interests in certain foreign corporations, covering reporting categories, ownership, schedules and timing.

What Form 5471 reports

Form 5471 provides information about certain foreign corporations through reporting by specified U.S. officers, directors, and shareholders. The IRS describes the form and its schedules as serving the reporting requirements under sections 6038 and 6046 and their regulations.[1][2]

The instructions organize reporting around filer categories, with schedules and statements assigned through a filing requirements chart. A person falling within several categories completes the applicable information without repeating it.[2]

Who the filing categories describe

The instructions describe five numbered categories, including separate subdivisions within Categories 1 and 5. Their definitions turn on corporate roles, stock transactions, ownership, and the corporation's status.[2]

  • Category 1 generally covers a U.S. shareholder of a section 965 specified foreign corporation during its tax year ending with or within the shareholder's tax year, provided the shareholder held the stock on the last day of that corporate status.[2]
  • Category 2 covers a U.S. citizen or resident serving as an officer or director when a U.S. person acquires stock meeting the 10% requirement, or an additional 10% by value or voting power.[2]
  • Category 3 includes acquisitions meeting the 10% requirement, becoming a U.S. person while meeting that requirement, dispositions reducing ownership below it, and specified shareholders under section 953(c).[2]
  • Category 4 covers a U.S. person controlling a foreign corporation during its annual accounting period.[2]
  • Category 5 generally covers a U.S. shareholder holding stock in a controlled foreign corporation during its tax year ending with or within the shareholder's tax year, with ownership on the last day it was a CFC.[2]

Ownership definitions and exceptions

The Category 4 control threshold is more than 50% of voting power or total stock value at any time during the person's tax year. Control can also extend through a corporation that itself holds more than 50% of another corporation's voting power or value.[2]

For Category 5, the general U.S. shareholder threshold is 10% of voting power or stock value, counting direct, indirect, or constructive ownership under section 958. The general CFC definition requires U.S. shareholders collectively to own more than 50% of voting power or value on any day of the corporation's tax year; separate insurance provisions also appear.[2]

The instructions provide category-specific filing exceptions. For example, the Category 3 constructive ownership exception requires no direct interest, reporting arising solely through constructive ownership from another U.S. person, and that person's Form 5471 supplying all required information.[2]

Information and supporting statements

The form requests identifying and ownership information, including the individual's Social Security number and voting power held directly, indirectly, or constructively at the corporation's accounting period end. It also requests a principal business activity code and description, plus a three-letter functional currency code.[2]

Category 3 filers attach a statement identifying the amount and type of specified related-person indebtedness. That statement also supplies each stock subscriber's name, address, identifying number, and subscribed share count.[2]

Schedule-by-schedule subjects

The schedules collect different financial and transactional information, with applicability depending on the filing category. The IRS describes the following subjects for individual schedules.[1][2]

  • Schedule H addresses earnings and profits for the period under U.S. tax rules; Schedule J addresses accumulated CFC earnings and profits in functional currency.[1]
  • Schedule M reports transactions during the foreign corporation's accounting period ending with or within the U.S. person's tax year, and applies to Category 4 filers.[2]
  • Schedule O reports corporate organization, reorganization, and stock acquisitions or dispositions; Schedule R reports information about distributions from foreign corporations.[2]

Connections to other IRS forms

Form 5471 reporting can connect to Forms 8858 and 8938. Where the foreign corporation is the tax owner of a foreign disregarded entity or foreign branch, the instructions require Category 4, 5a, and 5c filers to attach Form 8858.[2]

Other foreign financial assets may trigger Form 8938 reporting. For excepted specified foreign financial assets reported on Form 5471, the instructions describe checking item E and completing Form 8938, Part IV, line 17, without reporting those assets again there.[2]

Filing timing and reporting periods

The instructions attach Form 5471 to the applicable income tax, partnership, or exempt organization return, using that return's deadline, including extensions. Generally, the information covers the foreign corporation's tax year ending with or within the filer's tax year; Schedule O instead covers specified stock and organizational events during the filer's tax year.[2]

Questions and answers

Does being a U.S. citizen alone establish a filing category?

The instructions tie the categories to further conditions involving corporate roles, ownership, or stock transactions. Category 2, for example, concerns an officer or director and a qualifying acquisition by a U.S. person.[2]

Is a separate Form 5471 used for each corporation?

The instructions call for a distinct Form 5471 with applicable schedules for each applicable foreign corporation. Several filing categories applying to one filer do not call for duplicated information.[2]

Does a required schedule disappear when every amount is zero?

The instructions retain the schedule requirement when all amounts are zero. They specify reporting at least one zero amount on that schedule.[2]

Are all amounts reported in U.S. dollars?

Currency requirements depend on the schedule, with some amounts reported in functional currency, U.S. dollars, or both. Schedule F requests dollar amounts and generally uses U.S. GAAP translation, with separate rules for the dollar approximate separate transactions method.[2]

Related glossary terms

  • Substitute Form 3520-A: A substitute Form 3520-A is filed by a U.S. owner when a foreign trust fails to file its annual return, and it carries its own timing and statement rules.
  • Foreign trust: For federal tax purposes, a trust is foreign if it fails either the court test or the control test. The tests concern U.S. court oversight and decision control.
  • Foreign grantor trust: A foreign grantor trust is a foreign trust treated as owned by a grantor, often a U.S. person. Ownership brings Form 3520 and Form 3520-A reporting duties.

Related articles and guides

Tools and official documents

  • Form 8865: foreign partnerships: Form 8865 reports U.S. persons' interests in certain foreign partnerships: filer categories, definitions, schedules, related forms and timing for citizens.

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Sources and data notes
  1. Internal Revenue Service, About Form 5471. https://www.irs.gov/forms-pubs/about-form-5471. Retrieved .
  2. Internal Revenue Service, Instructions for Form 5471. https://www.irs.gov/instructions/i5471. Retrieved .

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