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Automated preparation of form 5471 for international
ONESOURCE Income Tax International automates the preparation of Form 5471 (Information return of U.S. persons with respect to certain foreign corporations) for foreign corporations.
The classification is determined by the Foreign Entity Type which you select on the
International
tab of the Binder Properties window.
- Select the foreign entity type on theInternationaltab of the Binder Properties for the foreign entity binders.
noteThe Form 5471 created in a CFC and 10/50 binder is automatically marked to e-file. To change the e-file setting, open Organizer, then select . Update theElectronically file the Form 5471option. - Information transfers to Form 5471 during TAS Compute and International Compute.
- Schedules not populated by the application can be imported using ONESOURCE Excel Add-in or ONESOURCE Workpapers.
- During anInternational Compute, transfer information to the front of Form 5471 Organizer pages for specific schedules.
- Before transferring new results, the International Compute andTransfer to US5471, US8865 and US8858process deletes all existing information in the noted schedules.
- If you enter manual overrides in Organizer, select the appropriate options on theINTL Transfer Optionspages to prevent additional transfers from International Computes.
- Determine if you plan to file Form 5471 Schedules I and P by Shareholder or Summary and use the Enterprise Control Panel to block transfer to the alternate approach.
- For tax year 2021, the IRS e-file schema requires a Reference ID for foreign entities filing a 5471 even when an EIN is provided.
- Manually enter information in the 5471 Organizer for the initial year, and it will roll over to the next year. Or, you can enter the name, address, tax year dates, EIN, and voting percentage of the corporate parent in Income Tax by selecting .noteDuring TAS Compute and Consolidation, the Foreign Form Default Filer is transferred to the Organizer and stored in fields that are not visible. UseTax Formsto review the data. Any manual entries in the 5471 Organizer supersede the Default Filer data from TAS.
- For new entities, stock descriptions and beginning and ending shares (Schedule A - Stock of Foreign Corporation) are either entered manually in Organizer or imported.
- The U.S. Shareholders of the Foreign Corporation, stock held, beginning and ending shares, and pro-rata Subpart F percentage are reported on Form 5471 Schedule B - Part I U.S. Shareholders of the Foreign Corporation.noteWe added Part II – Direct Shareholders of the Foreign Corporation in tax year 2018. The shareholder information, stock descriptions and beginning and ending shares are either manually entered in Organizer or imported.
- For Schedule C - Income Statement use Tax Return Codes (TRCs) to map general ledger accounts to specific lines on the tax forms. For tax years 2020 and after, we added income statement TRCs.
- During a TAS Compute and Consolidation, functional currency and U.S. Dollar amounts flow to the Organizer.noteIf you want to completely ignore the information transferred from the Foreign Form Default Filer screen, selectDo not use Default File Informationlocated in Organizer, .
- For Schedule E Part I, section 1 (Taxes for which a Foreign Tax Credit is Allowed) amounts are transferred to the face of the schedule for each basket.
- For Schedule F (Balance Sheet), amounts are transferred to individual lines based on TRCs.
- For Schedule G (Other Information), you will manually complete responses to most questions in Organizer. During binder rollover from 2020 to 2021, responses for some Schedule G questions flow to the new year (see Response Rollover table.)
- For Schedule G-1 (cost sharing arrangement), you will complete Schedule G-1 manually in the Organizer.
- For Schedule H (Current Earnings and Profits or Taxable Income), tax adjustments are entered in a journal entry format. For each tax adjustment, you can select a 62-xxx series TRC on the Foreign tab under Tax Return Presentation to define where the adjustment will appear on the Form 5471/8885 Schedule H.
- For Schedule I (Summary of Shareholder’s Income from Foreign Corporation), the current year inclusions are calculated for the U.S. Shareholders of each foreign corporation.
- For Schedule I-1 (Information for Global Intangible Low-Taxed Income (GILTI)), enter data for Section 163(j) and other adjustments in the GILTI Workpaper.
- ForSchedule J Part I(Accumulated E&P of a Controlled Foreign Corporation), enter beginning balances in the Post-86 E&P and Taxes screen.
- ForSchedule J Part II(Nonpreviously taxed E&P subject to recapture section 952(c)(2)). Reporting Subpart F Recapture account activity was added to Form 5471 in tax year 2018. Enter beginning balances in the Subpart F Recapture screen.
- ForSchedule M(Transactions Between Controlled Foreign Corporation and Shareholders or Other Related Persons), enter data manually in Organizer, import it, or transfer it from the Form 5471 Schedule M Workpaper.
- ForSchedule O(Organization or Reorganization of Foreign Corporation, and Acquisitions and Dispositions of its Stock), amounts are either entered manually in Organizer or imported.
- ForSchedule P(Previously Taxed Earnings and Profits of U.S. Shareholders of Certain Foreign Corporations), ONESOURCE generates separate Schedule P’s for each individual first-tier FTC shareholder.
- ForSchedule Q(CFC Income by CFC Income Groups), an individual Schedule Q is created by basket, foreign versus U.S. source characteristic, and by withholding tax category for passive income or by FOGI versus non-FOGI for general limitation income.
- ForSchedule R(Distributions from a Foreign Corporation), the system transfers dividend payment information to Schedule R.
Before transferring new results, it is important to select the appropriate options on the INTL Transfer Options page to retain information and prevent loss of any Organizer overrides when running the
International Compute, Transfer to US5471, US8865, US8858
for the binder.