Elimination returns
Every consolidation needs an Elimination Return. This is where you'll manage and record all inter-company transactions that need to be removed (eliminated) for tax purposes.
Enter nonlife eliminating entries in the same 1120 subgroup's
Income/Deductions
and Schedule M-3
screens.If needed, you can convert a subgroup elimination return into a nonlife elimination return. Entries you make automatically transfer from the subgroup elimination company to the Nonlife eliminations company.
note
Do the elimination entries at the Nonlife and subgroup company level. The software doesn't support elimination adjustments at the Life-Nonlife level.
Types of elimination returns
- Life-Nonlife (LNL) topcon elimination
- Nonlife (NL) elimination
- Subgroup eliminations.
Nonlife elimination return
The Nonlife return has an elimination company in which intercompany entries can be made between the 1120 and the 1120-PC returns. These elimination entries are made in the Nonlife elimination entry screens. There are limited data entry fields in the Nonlife elimination return. The Nonlife elimination return is not included in the e-file sent to the IRS, but it does consolidate to the top level consolidation.
Insurance Consolidations Step 2 - Eliminating entries
In the Nonlife Elimination Organizer, you have to choose the proper return entity page to enter data, 1120 or 1120-PC. The following screens have fields available to enter data:
- 1120 Income & Deductions
- 1120 Balance Sheet (beginning and ending balances)
- 1120 M-1 & M-2
- 1120 M-3 Part II & III
- 1120-PC Income & Deductions
- 1120-PC Balance Sheet (beginning and ending balances)
- 1120-PC M-1 & M-2
- 1120-PC M-3 Part II & III
Subgroup Elimination
Each subgroup Subconsolidation has its own subgroup elimination return. The elimination return type matches the subgroup return type 1120, 1120-L or 1120-PC. Subgroup elimination returns are there to make the intercompany and elimination entries for the subgroup.
note
Only the topmost subgroup elimination return of each return type is included in the e-file.
