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                                                                                                                 Department of the Treasury
                                                                                                                 Internal Revenue Service
Instructions for Form 

1120-FSC

(Rev. February 2019)
U.S. Income Tax Return of a Foreign Sales Corporation

Section references are to the Internal Revenue Code now used to report the base erosion             • The business is facing an immediate 
unless otherwise noted.                             minimum tax, if applicable.                     threat of adverse action.
Contents                                      Page  Base erosion minimum tax.      If the           • The corporation has tried repeatedly to 
                                                                                                    contact the IRS but no one has responded, 
General Instructions .  . . . . . . . . . . . . 1   corporation had gross receipts of at least      or the IRS hasn't responded by the date 
Purpose of Form .          . . . . . . . . . . . 1  $500 million in any one of the 3 tax years      promised.
FSC Repeal and                                      preceding the current tax year, complete 
Extraterritorial Income                             Form 8991. See section 59A and the                The TAS toolkit at 
Exclusion         . . . . . . . . . . . . . . 1     Instructions for Form 8991. Also see the        TaxpayerAdvocate.IRS.gov can help the 
Pre-Repeal FSC Rules .            . . . . . . . 2   instructions for Schedule J, line 3, later.     corporation understand these rights.
Who Must File           . . . . . . . . . . . . . 4 Small business taxpayers.   Effective for         TAS has offices in every state, the District 
When To File .          . . . . . . . . . . . . . 4 tax years beginning after 2017, P.L. 115-97     of Columbia, and Puerto Rico. Local 
Where To File .         . . . . . . . . . . . . . 4 expanded the eligibility of small business      advocates' numbers are in their local 
Who Must Sign .         . . . . . . . . . . . . 4   taxpayers to use the cash method. See           directories and at 
                                                    Accounting Methods, later.                      TaxpayerAdvocate.IRS.gov. The corporation 
Paid Preparer Authorization .           . . . . 4                                                   can also call TAS at 1-877-777-4778.
Other Forms That May Be                             Limitation on business interest expense. 
Required .        . . . . . . . . . . . . . . 4     For tax years beginning after 2017,               TAS also works to resolve large-scale or 
Assembling the Return .           . . . . . . . 4   taxpayers who deduct business interest are      systemic problems that affect many 
Accounting Methods .            . . . . . . . . 5   required to file Form 8990, Limitation on       taxpayers. If the corporation knows of one of 
                                                    Business Interest Expense Under Section         these broad issues, please report it to TAS 
Accounting Period .         . . . . . . . . . . 5   163(j), unless an exception for filing is met.  through the Systemic Advocacy 
Recordkeeping .         . . . . . . . . . . . . 5   For more information, see Form 8990 and         Management System at IRS.gov/SAMS.
Tax Payments            . . . . . . . . . . . . . 5 the Instructions for Form 8990.                   For more information, go to IRS.gov/
Estimated Tax Payments              . . . . . . 6                                                   Advocate.
                                                    Net operating loss (NOL).   The 2-year 
Interest and Penalties .        . . . . . . . . 6   carryback rule does not apply to NOLs 
Rounding Off to Whole Dollars .       . . . . . 5   arising in tax years ending after December      General Instructions
Specific Instructions . . . . . . . . . . . . . 6   31, 2017. Exceptions apply to certain 
FSC Information .          . . . . . . . . . . . 6  farming losses and NOLs of insurance 
Tax and Payments .          . . . . . . . . . . 7   companies other than life insurance             Purpose of Form
Schedule A .      . . . . . . . . . . . . . . 7     companies. See section 172(b). Also see the     Use Form 1120-FSC to report the income, 
Additional Information          . . . . . . . . 8   instructions for Schedule B, line 20, later.    gains, losses, deductions, credits, and to 
Schedule B .      . . . . . . . . . . . . . . 8                                                     figure the income tax liability of a FSC.
Schedule E .      . . . . . . . . . . . . . . 9     Photographs of Missing 
Schedule F .      . . . . . . . . . . . . . . 9     Children                                        FSC Repeal and 
Schedule G .      . . . . . . . . . . . . .     10  The Internal Revenue Service is a proud         Extraterritorial Income 
Schedule J        . . . . . . . . . . . . . .   11  partner with the National Center for Missing 
Schedule L        . . . . . . . . . . . . . .   12  & Exploited Children® (NCMEC).                  Exclusion
Schedule M-1 .          . . . . . . . . . . . . 12  Photographs of missing children selected by     In general, the FSC Repeal and 
                                                    the Center may appear on pages that would       Extraterritorial Income Exclusion Act of 2000:
                                                    otherwise be blank. You can help bring these    • Repealed the FSC rules,
Future Developments                                 children home by looking at the photographs     • Provided taxpayers with an exclusion, 
For the latest information about                    and calling 1-800-THE-LOST                      which is figured on Form 8873, 
developments related to Form 1120-FSC               (1-800-843-5678) if you recognize a child.      Extraterritorial Income Exclusion, and
                                                                                                    • Provided transition rules for existing 
and its instructions, such as legislation                                                           FSCs. These rules are included in Rules for 
enacted after they were published, go to            The Taxpayer Advocate                           Existing FSCs below.
IRS.gov/Form1120FSC.                                Service
                                                    The Taxpayer Advocate Service (TAS) is an       Note. The American Jobs Creation Act of 
What's New                                          independent organization within the IRS         2004 repealed the extraterritorial income 
Tax rates. For tax years beginning after            that helps taxpayers and protects taxpayer      exclusion provisions generally for 
2017, P.L. 115-97 replaced the graduated            rights. TAS’s job is to ensure that every       transactions after 2004, subject to a 
corporate tax structure with a flat 21%             taxpayer is treated fairly and knows and        transition rule. See the Instructions for Form 
corporate tax rate. See the instructions for        understands their rights under the Taxpayer     8873 for more information.
Schedule J, line 2, later.                          Bill of Rights.                                   The Tax Increase Prevention and 
                                                                                                    Reconciliation Act of 2005 repealed the FSC 
Alternative minimum tax.        The alternative       As a taxpayer, the corporation has rights     binding contract exception. See Binding 
minimum tax (previously reported on                 that the IRS must abide by in its dealings      contract exception below for details.
Schedule J, line 3) does not apply to               with the corporation. TAS can help the 
corporations for tax years beginning after          corporation if:                                 Rules for Existing FSCs
December 31, 2017. Schedule J, line 3 is            • A problem is causing financial difficulty for In general, a FSC that was in existence on 
                                                    the business.                                   September 30, 2000, and at all times 

Feb 11, 2019                                                        Cat. No. 11532V

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thereafter may continue to use the FSC rules tax years beginning with the first tax year for • An office in one of the qualifying foreign
for any transaction in the ordinary course of which the original election is not in effect as a countries or U.S. possessions listed above,
business that is (a) before January 1, 2002, result of the revocation or termination. • A set of permanent books of account
or (b) after December 31, 2001, if such (including invoices) at that office, and
transaction is pursuant to a binding contract Effect of election. For purposes of section The books and records required under
that meets the requirements described in 367, a foreign corporation that has elected to •
section 6001 at a U.S. location to sufficiently
Binding contract exception below. be a domestic corporation is generally establish the amount of gross income,
treated as transferring, as of the first day of deductions, credits, or other matters required
Binding contract exception. The binding the first tax year to which the election to be shown on its tax return.
contract exception has been repealed for tax applies, all of its assets to a domestic
years beginning after May 17, 2006. For tax corporation in an exchange under section 5. It must have at least one director, at
years beginning before May 18, 2006, the 354. all times during the tax year, who is not a
following rules apply: The transaction must resident of the United States.
be pursuant to a binding contract between FSC Election 6. It must not be a member, at any time
the FSC (or a person related to the FSC) and No corporation may elect to be a FSC or a during the tax year, of a controlled group of
a person other than a related person if that small FSC (defined below) after September which a DISC is a member.
binding contract was in effect on September 30, 2000. 7. It must have elected to be a FSC or
30, 2000, and has remained in effect. A small FSC, and the election must have been
binding contract includes a purchase, Termination of Inactive FSCs
in effect for the tax year.
renewal, or replacement option that is If a FSC has no foreign trade income (see
enforceable against a lessor or seller definition under Tax Treatment of a FSC, Small FSC. Section 922(b) defines a small
(provided the option is part of a contract that later) for any 5 consecutive tax years FSC as a corporation that:
is binding and in effect on September 30, beginning after December 31, 2001, the FSC • Elected small FSC status and has kept
2000, and has remained in effect). will no longer be treated as a FSC for any tax the election in effect for the tax year and
year beginning after that 5-year period.
The mere entering into of a single • Is not a member, at any time during the
transaction, such as a lease, would not, in Additional Information tax year, of a controlled group that includes a
FSC (unless that other FSC is also a
and of itself, prevent the transaction from For additional information regarding the rules small FSC).
being in the ordinary course of business. discussed above, see Rev. Proc. 2001-37,
2001-1 C.B. 1327. A small FSC is exempt from the foreign
Election To Apply Exclusion Rules management and foreign economic process
requirements outlined on this page.
Taxpayers may elect to apply the Pre-Repeal FSC Rules
extraterritorial income exclusion rules $5 million limit. Generally, any foreign
instead of the FSC rules for transactions Definition of a Foreign Sales trading gross receipts of a small FSC for the
occurring during the transition period. The Corporation (FSC) tax year that exceed $5 million are not to be
election is: Under section 922(a), a FSC is defined as a considered in determining its exempt foreign
• Made by checking the box on line 2 of corporation that has met all of the following trade income. The $5 million limit is reduced
Form 8873, rules: if the small FSC has a short tax year. It may
• Made on a transaction-by-transaction also be reduced if the small FSC is a
basis, 1. It must be a corporation created or member of a controlled group that contains
• Effective for the tax year for which it is organized under the laws of a qualifying other small FSCs. See Regulations section
made and for all subsequent tax years, and foreign country or any U.S. possession other 1.921-2(b) for more information.
• Revocable only with the consent of the than Puerto Rico.
IRS. Qualifying U.S. possessions include Tax Treatment of a FSC
Guam, American Samoa, the A FSC is not taxed on its exempt foreign
Taxpayers use Form 8873 to determine Commonwealth of the Northern Mariana trade income. Section 923 defines foreign
their extraterritorial income exclusion. Islands, and the U.S. Virgin Islands. trade income as the gross income of a FSC
Election To Be Treated as a A qualifying foreign country is a foreign attributable to foreign trading gross receipts
country that meets the exchange of (defined below).
Domestic Corporation information rules of section 927(e)(3)(A) or The percentage of foreign trade income
A FSC that was in existence on September (B). All U.S. possessions other than Puerto exempt from tax is figured differently for
30, 2000, and at all times thereafter may Rico are also certified to have met these income determined under the administrative
elect to be treated as a domestic corporation rules. pricing rules (for details, see the Instructions
if substantially all of its gross receipts are The following countries are qualifying for Schedule P (Form 1120-FSC)) and
foreign trading gross receipts. A FSC that foreign countries that have met the exchange income determined without regard to the
elects to be treated as a domestic of information rules of section 927(e)(3)(A) or administrative pricing rules. These
corporation ceases to be a FSC for any tax 927(e)(3)(B): Australia, Austria, Barbados, percentages are computed on Schedule E,
year for which the election applies (and for Belgium, Bermuda, Canada, Costa Rica, page 4, Form 1120-FSC, and carried over to
any subsequent tax year). Cyprus, Denmark, Dominica, the Dominican lines 9a and 9b of Schedule B, page 3, Form
The election is made by checking the box Republic, Egypt, Finland, France, Germany, 1120-FSC, to figure taxable income or (loss).
on line 3 of Form 8873. An electing Grenada, Guyana, Honduras, Iceland,
corporation files Form 1120, U.S. Ireland, Jamaica, Korea, Malta, the Marshall See section 923(a)(4) for a special rule
Corporation Income Tax Return. Once Islands, Mexico, Morocco, the Netherlands, for foreign trade income allocable to a
made, the election applies to the tax year for New Zealand, Norway, Pakistan, Peru, the cooperative. See section 923(a)(5) for a
which it is made and remains in effect for all Philippines, St. Lucia, Sweden, and Trinidad special rule for military property.
subsequent years unless the election is and Tobago. Tax treaty benefits. A FSC may not claim
revoked or terminated. If the election is 2. It had no more than 25 shareholders any benefits under any income tax treaty
revoked or terminated, the corporation would at any time during the tax year. between the United States and any foreign
be a foreign corporation that files Form 3. It had no preferred stock outstanding country.
1120-F, U.S. Income Tax Return of a Foreign at any time during the tax year.
Corporation. Furthermore, the foreign
corporation would not be eligible to reelect to 4. During the tax year, the FSC must
be treated as a domestic corporation for 5 maintain:

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Foreign Trading Gross the economic processes of a transaction • Are incident to and necessary for the
takes place outside the United States. performance of any activity described in
Receipts section 924(e);
A FSC is treated as having foreign trading Generally, a transaction will qualify if the • Include the cost of materials consumed in
gross receipts (defined in section 924) only if FSC satisfies two requirements: the performance of the activity and the cost
it has met certain foreign management and • Participation outside the United States in of labor that can be identified or associated
foreign economic process requirements. the sales portion of the transaction and directly with the performance of the activity
Foreign trading gross receipts do not • Satisfaction of either the 50% or the 85% (but only to the extent of wages, salaries,
include: foreign direct cost test. fees for professional services, and other
• Certain excluded receipts (defined in amounts paid for services actually rendered,
section 924(f)). The activities comprising these economic such as bonuses or compensation paid for
• Receipts attributable to property excluded processes may be performed by the FSC or services on the basis of a percentage of
from export property under section 927(a) by any other person acting under contract profits); and
(2). with the FSC. • Include the allowable depreciation
deduction for equipment or facilities (or the
• Investment income (defined in section Participation outside the United States in rental cost for its use) that can be specifically
927(c)). the sales portion of the transaction. identified or associated with the activity, as
• Carrying charges (defined in section Generally, the requirement of section 924(d) well as the contract price of an activity
927(d)(1)). (1)(A) is met for the gross receipts of a FSC performed on behalf of the FSC by a
Note. Computer software licensed for derived from any transaction if the FSC has contractor.
reproduction abroad is not excluded from participated outside the United States in the Total direct costs means all of the direct
export property under section 927(a)(2). following sales activities relating to the costs of any transaction attributable to
Therefore, receipts attributable to the sale, transaction: (1) solicitation (other than activities described in any paragraph of
lease, or rental of computer software and advertising), (2) negotiation, and (3) making section 924(e). For purposes of the 50% test
services related and subsidiary to such a contract. of section 924(d)(1)(B), total direct costs are
transactions qualify as foreign trading gross 1. Solicitation (other than advertising) is based on the direct costs of all activities
receipts. any communication (including, but not described in all paragraphs of section
limited to, telephone, telegraph, mail, or in 924(e). For purposes of the 85% test of
person) by the FSC, to a specific, targeted section 924(d)(2), however, the total direct
Foreign Management Rules customer or potential customer. costs are determined separately for each
A FSC (other than a small FSC) is treated as 2. Negotiation is any communication by paragraph of section 924(e).
having foreign trading gross receipts for the the FSC to a customer or potential customer Foreign direct costs means the portion
tax year only if the management of the FSC aimed at an agreement on one or more of the of the total direct costs of any transaction
during the year takes place outside the terms of a transaction, including, but not attributable to activities performed outside
United States. These management activities limited to, price, credit terms, quantity, or the United States. For purposes of the 50%
include: time or manner of delivery. test, foreign direct costs are based on the
• Meetings of the board of directors and direct costs of all activities described in all
meetings of the shareholders. 3. Making a contract refers to
• Disbursing cash, dividends, legal and performance by the FSC of any of the paragraphs of section 924(e). For purposes
accounting fees, salaries of officers, and elements necessary to complete a sale, such of the 85% test, however, foreign direct costs
salaries or fees of directors from the principal as making or accepting an offer. are determined separately for each
paragraph of section 924(e).
bank account (see below). Grouping transactions. Generally, the For more details, see Regulations section
• Maintaining the principal bank account at sales activities described above are to be 1.924(d)-1(d).
all times during the tax year. applied on a transaction-by-transaction
Meetings of directors and meetings of basis. However, a FSC may make an annual Check the applicable box(es) on line 10b,
the shareholders. All meetings of the election to apply any of the sales activities on Additional Information, on page 2 of the form,
board of directors of the FSC and all the basis of a group. To make the election, to indicate how the FSC met the foreign
meetings of the shareholders of the FSC that check the applicable box on line 10a, direct costs requirement.
take place during the tax year must take Additional Information, on page 2 of Form Grouping transactions. Generally, the
place outside the United States. 1120-FSC. See Regulations section foreign direct cost tests under Regulations
1.924(d)-1(c)(5) for details.
In addition, all such meetings must section 1.924(d)-1(d) are applied on a
comply with the local laws of the foreign Satisfaction of either the 50% or 85% for- transaction-by-transaction basis. However,
country or U.S. possession in which the FSC eign direct cost test. To qualify as foreign the FSC may make an annual election (on
was created or organized. The local laws trading gross receipts, the foreign direct line 10d, Additional Information, on page 2 of
determine whether a meeting must be held, costs incurred by the FSC attributable to the the form) to apply the foreign direct cost tests
when and where it must be held (if it is held transaction must equal or exceed 50% of the on a customer, contract, or product or
at all), who must be present, quorum total direct costs incurred by the FSC product line grouping basis. Any grouping
requirements, use of proxies, etc. attributable to the transaction. used must be supported by adequate
Principal bank accounts. See Regulations Instead of satisfying the 50% foreign documentation of performance of activities
section 1.924(c)-1(c) for information direct cost test, the FSC may incur foreign and costs of activities relating to the grouping
regarding principal bank accounts. direct costs attributable to activities used. See Regulations section 1.924(d)-1(e)
described in each of two of the section for details.
924(e) categories. The costs must equal or Exception for foreign military property.
Foreign Economic Process Rules exceed 85% of the total direct costs incurred The economic process rules do not apply to
A FSC (other than a small FSC) has foreign by the FSC attributable to the activity any activities performed in connection with
trading gross receipts from any transaction described in each of the two categories. If no foreign military sales except those activities
only if certain economic processes for the direct costs are incurred by the FSC in a described in section 924(e). See Regulations
transaction take place outside the United particular category, that category is not taken section 1.924(d)-1(f) for details.
States. Section 924(d) and Regulations into account for purposes of determining
section 1.924(d)-1 set forth the rules for whether the FSC has met either the 50% or Section 925(c) Rule
determining whether a sufficient amount of 85% foreign direct cost test. To use the administrative pricing rules to
Direct costs are costs that: determine the FSC's (or small FSC's) profit

Instructions for Form 1120-FSC (Rev. 2-2019) -3-

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on a transaction or group of transactions, the  Where To File                                     The authorization will automatically end 
FSC must perform (or contract with another                                                      no later than the due date (excluding 
person to perform) all of the economic          File Form 1120-FSC with the:                    extensions) for filing the FSC's tax return. If 
process activities relating to the transaction  Internal Revenue Service Center                 the FSC wants to expand the paid preparer's 
or group of transactions. All of the direct and P.O. Box 409101                                 authorization or revoke it before it ends, see 
indirect expenses relating to the               Ogden, UT 84409                                 Pub. 947, Practice Before the IRS and Power 
performance of those activities must be                                                         of Attorney.
reflected on the books of the FSC and on        Who Must Sign
Form 1120-FSC.                                  The return must be signed and dated by:         Other Forms That May Be 
                                                • The president, vice president, treasurer, 
Under Temporary Regulations section             assistant treasurer, chief accounting officer   Required
1.925(a)-1T(b)(2)(ii), an election may be       or                                              The FSC may have to file some of the forms 
made to include on the FSC's books all          • Any other corporate officer (such as tax      listed below. See the form for more 
expenses, other than cost of goods sold, that   officer) authorized to sign.                    information.
are necessary to figure combined taxable 
income for the transaction or group of             If a return is filed on behalf of a FSC by a   For a list of additional forms the FSC may 
transactions. The expenses must be              receiver, trustee, or assignee, the fiduciary   need to file (most notably, forms pertaining to 
identified on Schedule G on the applicable      must sign the return, instead of the corporate  the reporting of various types of income, and 
line.                                           officer. Returns and forms signed by a          any related withholding, to U.S. persons, 
                                                receiver or trustee in bankruptcy on behalf of  foreign persons, and the IRS), see Pub. 542, 
                                                a FSC must be accompanied by a copy of          Corporations.
Who Must File                                   the order or instructions of the court          • Form 5471, Information Return of U.S. 
File Form 1120-FSC if the corporation           authorizing signing of the return or form.      Persons With Respect to Certain Foreign 
elected to be treated as a FSC or small FSC,                                                    Corporations. This form may have to be filed 
and the election is still in effect.               If an employee of the FSC completes          by certain U.S. officers, directors, or 
                                                Form 1120-FSC, the paid preparer space          shareholders of a FSC to report changes in 
Note. A FSC that elects to be treated as a      should remain blank. Anyone who prepares        ownership (see sections 6046 and the 
domestic corporation under section 943(e)       Form 1120-FSC but does not charge the           related regulations).
(1) does not file Form 1120-FSC. Instead, it    FSC should not complete that section.             If a Form 1120-FSC is filed, Form 5471 is 
files Form 1120.                                Generally, anyone who is paid to prepare the    not required to be filed to satisfy the 
                                                return must sign it and fill in the “Paid       requirements of section 6038 (see 
When To File                                    Preparer Use Only” area.                        Temporary Regulations section 1.921-1T(b)
Generally, a corporation must file Form                                                         (3)). However, certain U.S. shareholders 
1120-FSC by the 15th day of the 4th month          The paid preparer must complete the 
after the end of its tax year. A FSC that has   required preparer information and:              may be required to file Form 5471 and the 
dissolved must generally file by the 15th day   • Sign the return in the space provided for     applicable schedules to report subpart F 
of the 4th month after the date it dissolved.   the preparer's signature.                       income.
                                                • Give a copy of the return to the taxpayer.      See the Instructions for Form 5471 for 
                                                                                                more information.
However, a FSC with a fiscal tax year                                                           • Form 5472, Information Return of a 25% 
ending June 30 must file by the 15th day of     Note. A paid preparer may sign original or 
the 3rd month after the end of its tax year. A  amended returns by rubber stamp,                Foreign-Owned U.S. Corporation or a 
FSC with a short tax year ending anytime in     mechanical device, or computer software         Foreign Corporation Engaged in a U.S. 
June will be treated as if the short year       programs.                                       Trade or Business. Generally, a FSC that is 
                                                                                                engaged in a trade or business in the United 
ended on June 30, and must file by the 15th                                                     States that had a reportable transaction with 
day of the 3rd month after the end of its tax   Paid Preparer 
                                                                                                a foreign or domestic related party during the 
year.                                           Authorization                                   tax year must file Form 5472.
If the due date falls on a Saturday,            If the FSC wants to allow the IRS to discuss    • Form 5713, International Boycott Report. 
Sunday, or legal holiday, the FSC may file on   its tax return with the paid preparer who       FSCs that had operations in, or related to, 
the next business day.                          signed it, check the “Yes” box in the           certain “boycotting” countries file
                                                signature area of the return. This              Form 5713.
Private delivery services. FSCs can use         authorization applies only to the individual    • Form 8275, Disclosure Statement, and 
certain private delivery services (PDS)         whose signature appears in the “Paid            Form 8275-R, Regulation Disclosure 
designated by the IRS to meet the “timely       Preparer Use Only” section of the return. It    Statement. Use these forms to disclose 
mailing as timely filing” rule for tax returns. does not apply to the firm, if any, shown in    items or positions taken on a tax return that 
Go to IRS.gov/PDS. The PDS can tell you         that section.                                   are not otherwise adequately disclosed on a 
how to get written proof of the mailing date.                                                   tax return or that are contrary to Treasury 
                                                   If the “Yes” box is checked, the FSC is      regulations (to avoid parts of the 
For the IRS mailing address to use if           authorizing the IRS to call the paid preparer   accuracy-related penalty or certain preparer 
you’re using PDS, go to IRS.gov/                to answer any questions that may arise          penalties).
PDSstreetAddresses.                             during the processing of its return. The FSC    • Form 8300, Report of Cash Payments 
        Private delivery services cannot        is also authorizing the paid preparer to:       Over $10,000 Received in a Trade or 
!       deliver items to P.O. boxes. You        • Give the IRS any information that is          Business. Use this form to report the receipt 
CAUTION must use the U.S. Postal Service to     missing from the return,                        of more than $10,000 in cash or foreign 
mail any item to an IRS P.O. box address.       • Call the IRS for information about the        currency in one transaction or a series of 
                                                processing of the return or the status of any   related transactions.
Extension of time to file. File Form 7004,      related refund or payment(s), and
Application for Automatic Extension of Time     • Respond to certain IRS notices about 
To File Certain Business Income Tax,            math errors, offsets, and return preparation.   Assembling the Return
Information, and Other Returns, to request                                                      To ensure that the FSC's tax return is 
an extension of time to file. Generally, the       The FSC is not authorizing the paid          correctly processed, attach all schedules 
FSC must file Form 7004 by the return due       preparer to receive any refund check, bind      and other forms after page 6, Form 
date specified earlier. See the Instructions    the FSC to anything (including any additional   1120-FSC, and in the following order:
for Form 7004.                                  tax liability), or otherwise represent the FSC    1. Form 4136.
                                                before the IRS.

                                                                -4-                        Instructions for Form 1120-FSC (Rev. 2-2019)

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2. Additional schedules in alphabetical To do so, the FSC generally must file Form must be kept for 3 years from the date the
order. 3115, Application for Change in Accounting return is due or filed, whichever is later. Keep
3. Additional forms in numerical order. Method. For more information, see the records that verify the FSC's basis in
Instructions for Form 3115 and Pub. 538. property for as long as they are needed to
Complete every applicable entry space Also see Rev. Proc. 2015-13, 2015-5 I.R.B. figure the basis of the original or replacement
on Form 1120-FSC. Do not enter “See 419, and Rev. Proc. 2018-31, 2018-22 I.R.B. property.
Attached” or “Available Upon Request” 637 (or any successors).
instead of completing the entry spaces. If The FSC should keep copies of all filed
more space is needed on the forms or Section 481(a) adjustment. If the returns. They help in preparing future and
schedules, attach separate sheets using the FSC's taxable income for the current tax year amended returns.
same size and format as the printed forms. is figured under a method of accounting
different from the method used in the Tax Payments
If there are supporting statements and preceding tax year, the FSC may have to
attachments, arrange them in the same order make an adjustment under section 481(a) to The FSC must pay the tax due in full no later
as the schedules or forms they support and prevent amounts of income or expense from than the due date for filing Form 1120-FSC
attach them last. Show the totals on the being duplicated or omitted. The section (not including extensions). See When To
printed forms. Enter the FSC's name and EIN 481(a) adjustment period is generally 1 year File, earlier, for this due date. The method for
on each supporting statement or attachment. for a net negative adjustment and 4 years for payment of the tax due depends upon
a net positive adjustment. However, in some whether the FSC has an office or place of
Accounting Methods cases, a FSC can elect to modify the section business in the United States.
In general, figure taxable income using the 481(a) adjustment period. The FSC may FSCs that do not maintain an office or
method of accounting used in keeping the have to complete the appropriate lines of place of business in the United States can
FSC's books and records. In all cases, the Form 3115 to make an election. See the use the Electronic Federal Tax Payment
method used must clearly show taxable Instructions for Form 3115 for more System (EFTPS) to pay the tax due providing
income. Permissible overall methods of information and exceptions. the FSC has a U.S. bank account. If the FSC
accounting include cash, accrual, or any If the net section 481(a) adjustment is does not have a U.S. bank account, it may
other method authorized by the Internal positive, report it on page 4, Schedule F, arrange for a financial institution to initiate a
Revenue Code. line 16, as other income. If the net section same-day wire payment on its behalf or it
481(a) adjustment is negative, report it on can arrange for either a qualified
Generally, the following rules apply. page 4, Schedule F, line 18, as a deduction. intermediary, tax professional, payroll
• A FSC (other than a qualified personal service, or other trusted third party to make a
service corporation (as defined in section deposit on its behalf using a master account.
448(d)(2)) or a small business taxpayer Accounting Period In addition, the FSC still has the option to
(defined below)) must use an overall accrual A FSC must figure its taxable income on the pay by check or money order, payable to
method. However, see Nonaccrual basis of a tax year. A tax year is the annual “United States Treasury.” To help ensure
experience method for service providers, accounting period a FSC uses to keep its proper crediting, write the FSC's employer
later. records and report its income and expenses. identification number (EIN), “Form
• Generally, a FSC that is a qualified Generally, FSCs may use a calendar year or 1120-FSC,” and the tax period to which the
personal service corporation or a small a fiscal year. Personal service corporations, payment applies on the check or money
business taxpayer may use the cash method however, must generally use a calendar order. Enclose the payment when Form
of accounting. year. 1120-FSC is filed.
• Unless it is a small business taxpayer
(defined below), a FSC that is required to Note. The tax year of a FSC must be the FSCs that do maintain an office or place
maintain inventories must use an overall same as the tax year of the principal of business in the United States must pay the
accrual method. See the instructions for shareholder which, at the beginning of the tax due by electronic funds transfer. The
Schedule A, later. FSC tax year, has the highest percentage of FSC can pay the tax using EFTPS or it can
• Special rules apply to long-term contracts. voting power. If two or more shareholders arrange for its tax professional, financial
See section 460. have the highest percentage of voting power, institution, payroll service, or other trusted
the FSC must have a tax year that conforms third party to make deposits on its behalf. In
Small business taxpayer. Effective for tax to the tax year of any such shareholder. See addition, the FSC also has the option to
years beginning after 2017, a small business section 441(h). arrange for its financial institution to initiate a
taxpayer is a taxpayer that (a) has average same-day payment.
annual gross receipts of $25 million or less Rounding Off to Whole
for the 3 prior tax years, and (b) is not a tax Note. If the due date falls on a Saturday,
shelter (as defined in section 448(d)(3)). Dollars Sunday, or legal holiday, the payment is due
A small business taxpayer can adopt or The FSC may round off cents to whole on the next day that isn't a Saturday,
change its accounting method to account for dollars on its return and schedules. If the Sunday, or legal holiday.
inventories (a) in the same manner as FSC does round to whole dollars, it must
materials and supplies that are round all amounts. To round, drop amounts Electronic Deposit
nonincidental, or (b) to conform to its under 50 cents and increase amounts from Requirement
treatment of inventories in an applicable 50 to 99 cents to the next dollar (for example, FSCs with an office or place of business in
financial statement (as defined in section $1.39 becomes $1 and $2.50 becomes $3). the United States must use electronic funds
451(b)(3)). If it does not have an applicable transfers to make all federal tax deposits
financial statement, it can use the method of If two or more amounts must be added to
accounting used in its books and records figure the amount to enter on a line, include (such as deposits of employment and
prepared according to its accounting cents when adding the amounts and round corporate income tax). Generally, electronic
procedures. off only the total. funds transfers are made using EFTPS.
However, if the corporation does not want to
use EFTPS, it can arrange for its tax
For more information, see Pub. 538, Recordkeeping professional, financial institution, payroll
Accounting Periods and Methods. Keep the FSC's records for as long as they service, or other trusted third party to make
Change in accounting method. Generally, may be needed for the administration of any deposits on its behalf. Also, it can arrange for
the FSC must get IRS consent to change provision of the Internal Revenue Code. its financial institution to submit a same-day
either an overall method of accounting or the Usually, records that support an item of payment (discussed below) on its behalf.
accounting treatment of any material item. income, deduction, or credit on the return EFTPS is a free service provided by the

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Department of the Treasury. Services Interest and Penalties • $100 for each failure to supply
provided by a tax professional, financial information, up to $25,000 during the
institution, payroll service, or other third party Interest. Interest is charged on taxes paid calendar year.
may have a fee. late even if an extension of time to file is • $1,000 for not filing a return.
For more information about EFTPS or to granted. Interest is also charged on penalties The section 6686 penalties will not apply
enroll in EFTPS, visit EFTPS.gov, or call imposed for failure to file, negligence, fraud, if the FSC can show that the failure was due
1-800-555-4477 (TTY/TDD substantial valuation misstatements, to reasonable cause. However, see Caution,
1-800-733-4829). substantial understatements of tax, and above.
reportable transaction understatements from
Depositing on time. For any deposit made the due date (including extensions) to the
by EFTPS to be on time, the FSC must date of payment. The interest charge is Specific Instructions
submit the deposit by 8 p.m. Eastern time the figured at a rate determined under section
day before the date the deposit is due. If the 6621. Period covered. Enter the FSC ‘s tax year
FSC uses a third party to make deposits on in the space provided at the top of the form.
its behalf, the third party may have different Penalty for late filing of return. A FSC See Accounting Period, earlier.
cutoff times. that does not file its tax return by the due
date, including extensions, may be penalized Name. Print or type the FSC's true name (as
Same-day wire payment option. If the 5% of the unpaid tax for each month or part set forth in the charter or other legal
FSC fails to submit a deposit transaction on of a month the return is late, up to a document creating it).
EFTPS by 8 p.m. Eastern time the day maximum of 25% of the unpaid tax. The Address. Enter the U.S. address where the
before the date a deposit is due, it can still minimum penalty for a return that is over 60 FSC maintains the records required under
make the deposit on time by using the days late is the smaller of the tax due or section 6001. Include the suite, room, or
Federal Tax Collection Service (FTCS). To $210. The penalty will not be imposed if the other unit number after the street address. If
use the same-day wire payment option, the FSC can show that the failure to file on time the post office does not deliver mail to the
FSC will need to make arrangements with its was due to reasonable cause and not due to street address and the FSC has a P.O. box,
financial institution ahead of time regarding willful neglect. show the box number instead.
availability, deadlines, and costs. Financial
institutions may charge a fee for payments If you believe that reasonable cause If the FSC receives its mail in care of a
made this way. To learn more about the ! exists, do not attach an explanation third party (such as an accountant or an
information the FSC will need to provide to CAUTION when you file Form 1120-FSC. attorney), enter on the street address line
its financial institution to make a same-day Instead, if the FSC receives a penalty notice “C/O” followed by the third party's name and
wire payment, go to IRS.gov/SameDayWire. after the return is filed, send the IRS an street address or P.O. box.
explanation at that time and the IRS will
determine if the FSC meets reasonable Item A. Foreign country or U.S. posses-
Estimated Tax Payments cause criteria. sion of incorporation. See Definition of a
Generally, the following rules apply to the Foreign Sales Corporation (FSC), earlier.
FSC's payments of estimated tax. Penalty for late payment of tax. A FSC Item E. Total assets. Enter the FSC's total
• The FSC must make installment that does not pay the tax when due generally assets (as determined by the accounting
payments of estimated tax if it expects its may be penalized / of 1% of the unpaid tax 1 2 method regularly used in keeping the FSC's
total tax for the year (less applicable credits) for each month or part of a month the tax is books and records) at the end of the tax year
to be $500 or more. not paid, up to a maximum of 25% of the from page 6, Schedule L, column (d), line 15.
• The installments are due by the 15th day unpaid tax. The penalty will not be imposed if If there are no assets at the end of the tax
of the 4th, 6th, 9th, and 12th months of the the FSC can show that the failure to pay on year, enter -0-.
tax year. If any date falls on a Saturday, time was due to reasonable cause and not
Sunday, or legal holiday, the installment is due to willful neglect. However, see Caution, Item F. Final return, name change, ad-
due on the next regular business day. above. dress change, or amended return.
• If this is the FSC's final return and it will no
• Use Form 1120-W, Estimated Tax for Trust fund recovery penalty. This penalty longer exist, check the “Final return” box.
Corporations, as a worksheet to compute may apply if certain income, social security, • If the FSC changed its name since it last
estimated tax. See the Instructions for Form and Medicare taxes that must be collected or filed a return, check the box for “Name
1120-W. withheld are not collected or withheld, or change.” Generally, a FSC also must have
• If the FSC maintains an office or place of these taxes are not paid. These taxes are amended its articles of incorporation and
business in the United States, it must use generally reported on Form 941, Employer's filed the amendment with the jurisdiction in
electronic funds transfers to make QUARTERLY Federal Tax Return, or Form which it was incorporated.
installment payments of estimated tax. 945, Annual Return of Withheld Federal • If the FSC has changed its address since
• If the FSC does not maintain an office or Income Tax. it last filed a return (including a change to an
place of business in the United States, it can The trust fund recovery penalty may be “in care of” address), check the box for
pay the estimated tax by EFTPS providing it imposed on all persons who are determined “Address change.”
has a U.S. bank account. The FSC can also by the IRS to have been responsible for
arrange for its financial institution to submit a collecting, accounting for, or paying over Note. If a change of address or responsible
same-day wire payment on its behalf or can these taxes, and who acted willfully in not party occurs after the return is filed, use
arrange for its qualified intermediary, tax doing so. The penalty is equal to the full Form 8822-B, Change of Address or
professional, payroll service, or other trusted amount of the unpaid trust fund tax. See Responsible Party - Business, to notify the
third party to make a deposit on its behalf Pub. 15 (Circular E), Employer's Tax Guide, IRS. See the instructions for Form 8822-B for
using a master account. In addition, the FSC for details, including the definition of details.
still has the option to pay the estimated tax responsible persons. • If the FSC is amending its return, check
due by check or money order. See Form the box for “Amended return.”
1120-W for additional payment information. Other penalties. Other penalties may be
• If the FSC overpaid estimated tax, it may imposed for negligence, substantial
be able to get a quick refund by filing Form understatement of tax, reportable transaction FSC Information
4466, Corporation Application for Quick understatements, and fraud. See sections Line 1. Principal shareholder. Complete
Refund of Overpayment of Estimated Tax. 6662, 6662A, and 6663. lines 1a through 1h for the shareholder
For information on penalties that apply if A FSC may also be subject to a penalty (individual, corporation, partnership, trust, or
the FSC fails to make required payments, (under section 6686) of: estate) that was the principal shareholder at
see line 3, Estimated tax penalty, later.

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the beginning of the FSC's tax year. See the to the penalty if its tax liability is $500 or non-incidental, or conform to the FSC's
Note under Accounting Period, earlier. more and it did not timely pay at least the treatment of inventories in an applicable
smaller of: financial statement (as defined in section
Foreign address. Enter the information • Its current year tax liability or 451(b)(3)), or if the FSC does not have an
in the following order: city or town, state or • Its prior year's tax. applicable financial statement, the method of
province, country, and foreign postal code. accounting used in the FSC's books and
Follow the country's practice for entering the Use Form 2220, Underpayment of
name of the state or province and postal Estimated Tax by Corporations, to see if the records prepared in accordance with the
code. Do not abbreviate the country name. FSC owes the penalty and to figure the FSC's accounting procedures. Changing an
amount of the penalty. Generally, the FSC accounting method generally requires IRS
Line 2. Parent-subsidiary controlled does not have to file this form because the consent. See section 471(c)(1) and the
group. If the FSC is a subsidiary in a IRS can figure the amount of any penalty and Change in accounting method section,
parent-subsidiary controlled group and the bill the FSC for it. However, even if the FSC earlier.
principal shareholder is not the common does not owe the penalty, complete and Small business taxpayer. A small
parent of the group, complete lines 2a attach Form 2220 if the line 3 amount is $500 business taxpayer is a taxpayer that (a) has
through 2g for the common parent. Enter the or more and: average annual gross receipts of $25 million
consolidated total assets on line 2d for a • The annualized income or adjusted or less for the 3 prior tax years, and (b) is not
group that files a consolidated return; seasonal installment method is used or a tax shelter (as defined in section 448(d)
otherwise, enter only the common parent's • The FSC is a large corporation computing (3)). See section 471(c).
total assets. its first required installment based on the
prior year's tax. (See the Form 2220 All FSCs should see Section 263A
Note. Check the “Yes” box on line 2 if the instructions for the definition of a large uniform capitalization rules in the instructions
FSC is a subsidiary in a parent-subsidiary corporation.) for Schedule G, later. See those instructions
controlled group. This applies even if the before completing Schedule A.
FSC is a subsidiary member of one group If Form 2220 is attached, check the box
and the parent corporation of another. on line 3 and enter the amount of any penalty If the FSC uses intercompany pricing
on this line.
The term “parent-subsidiary controlled rules (for purchases from a related supplier),
group” means one or more chains of use the transfer price figured in Part II of
corporations connected through stock Schedule A Schedule P (Form 1120-FSC).
ownership (sections 927(d)(4) and 1563(a) Complete Schedule A only for the cost of Line 1. Inventory at beginning of year. If
(1)). Both of the following requirements must goods sold deduction related to foreign the FSC is changing its method of
be met: trading gross receipts reported on lines 1 accounting for the current tax year, it must
through 5 of Schedule B.
1. More than 50% of the total combined refigure last year's closing inventory using its
voting power of all classes of stock entitled to Complete column (a) to show the cost of new method of accounting and enter the
vote or more than 50% of the total value of all goods sold for inventory acquired in result on line 1. If there is a difference
classes of stock of each corporation in the transactions using the administrative pricing between last year's closing inventory and the
group (except the parent) must be owned by rules. Complete column (b) to show the cost refigured amount, attach an explanation and
one or more of the other corporations in the of goods sold for inventory acquired in take it into account when figuring the FSC's
group. transactions that did not use the section 481(a) adjustment (explained
2. The common parent must own more administrative pricing rules. For details on earlier).
than 50% of the total combined voting power the administrative pricing rules, see the Line 4. Additional section 263A costs. If
of all classes of stock entitled to vote or more Instructions for Schedule P (Form the FSC has elected a simplified method of
than 50% of the total value of all classes of 1120-FSC). accounting, enter on line 4 the balance of
stock of at least one of the other corporations section 263A costs paid or incurred during
in the group. If the FSC acts as another person's the tax year not includible on lines 2, 3, and
commission agent on a sale, do not enter 5.
Stock owned directly by other members any amount on Schedule A for the sale.
of the group is not counted when computing Line 5. Other costs. Enter on line 5 any
the voting power or value. Small FSCs will have to make two costs paid or incurred during the tax year not
separate computations for cost of goods sold entered on lines 2 through 4. Attach a
See sections 927(d)(4) and 1563(d)(1) for if their foreign trading gross receipts exceed statement listing details of the costs.
the definition of “stock” for purposes of the limitation amount on line 6e of
determining stock ownership above. Schedule B. In this case, a deduction for cost Line 7. Inventory at end of year. See
of goods sold will be figured separately for Regulations sections 1.263A-1 through
Tax and Payments the income on line 6h of Schedule B, and 1.263A-3 for details on determining the
separately for the income on line 7 of amount of additional section 263A costs to
Line 2h. Backup withholding. If the FSC Schedule F. be included in ending inventory.
had income tax withheld from any payments
it received due to backup withholding, Inventories Lines 9a through 9f. Inventory valuation
methods. Inventories may be valued at:
include the amount withheld in the total for Generally, unless you are a small business • Cost,
line 2h. Show the amount withheld in the taxpayer, inventories are required at the • Cost or market value (whichever is lower),
blank space in the right-hand column beginning and end of each tax year if the or
between lines 1 and 2h, and write “backup purchase or sale of merchandise is an • Any other method approved by the IRS
withholding.” income-producing factor. See Regulations that conforms to the requirements of the
section 1.471-1. Additionally, if inventories applicable regulations.
Note. Do not include backup withholding are required, you generally must use an
amounts on line 2g. Include on line 2g only overall accrual method of accounting. FSCs that use erroneous valuation
amounts withheld under Chapter 3 or 4 of the methods must change to a method permitted
Code. Exception for small business taxpayers. for federal income tax purposes. To make
Effective for tax years beginning after this change, use Form 3115. See the
Line 3. Estimated tax penalty. A FSC that December 31, 2017, if the FSC is a small Instructions for Form 3115. Also see Pub.
does not make estimated tax payments business taxpayer (defined below), it may 538.
when due may be subject to an adopt or change its accounting method to
underpayment penalty for the period of account for inventories in the same manner Line 9a. Method of valuing closing inven-
underpayment. Generally, a FSC is subject as materials and supplies that are tory. On line 9a, check the method(s) used

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for valuing inventories. Under lower of cost 3. Name of the tax matters partner (if computation of the taxable and nontaxable
or market, the term “market” (for normal any); and income included on line 15, column (b).
goods) means the current bid price 4. Beginning and ending dates of the Include only the taxable amount on line 16.
prevailing on the inventory valuation date for foreign partnership's tax year. Nonaccrual experience method for serv-
the particular merchandise in the volume
ice providers. Accrual method FSCs are
usually purchased by the taxpayer. If section Line 6. If the FSC has a net operating loss not required to accrue certain amounts to be
263A applies to the taxpayer, the basic (NOL) attributable to farming losses, it received from the performance of certain
elements of cost must reflect the current bid generally can elect to waive the entire services that, based on their experience, will
price of all direct costs and all indirect costs carryback period for the NOL and instead not be collected, if:
properly allocable to goods on hand at the carry the NOL forward to future tax years. To • The services are in the fields of health,
inventory date. do so, check the box on line 6 and file the tax law, engineering, architecture, accounting,
Inventory may be valued below cost when return by its due date, including extensions. actuarial science, performing arts, or
the merchandise is unsalable at normal Do not attach the statement described in consulting; or
prices or unusable in the normal way Temporary Regulations section • The corporation's average annual gross
because the goods are subnormal due to 301.9100-12T. Once made, the election is receipts for all prior tax years do not exceed
damage, imperfections, shop wear, etc. The irrevocable. $25 million. For more details, see section
goods may be valued at the bona fide selling If the FSC timely filed its return for the 448(d)(5).
price, minus direct cost of disposition (but loss year without making the election, it can This provision does not apply to any
not less than scrap value). Bona fide selling make the election on an amended return amount if interest is required to be paid on
price means actual offering of goods during a filed within 6 months of the due date of the the amount or if there is any penalty for
period ending not later than 30 days after loss year return (excluding extensions). failure to timely pay the amount. For more
inventory date. Attach the election to the amended return information, see Regulations section
Lines 9c and 9d. LIFO method. If this is and write "Filed pursuant to section 1.448-2.
the first year the Last-in, First-out (LIFO) 301.9100-2" on the election statement. See
inventory method was either adopted or the Instructions for Form 1139. Corporations that qualify to use the
nonaccrual experience method should attach
extended to inventory goods not previously Line 7. Enter the amount of the NOL a statement showing total gross receipts, the
valued under the LIFO method provided in carryover to the tax year from prior years, amount not accrued because of the
section 472, attach Form 970, Application To even if some of the loss is used to offset application of section 448(d)(5), and the net
Use LIFO Inventory Method, or a statement income on this return. The amount to enter is amount accrued. Enter the net amount on
with the information required by Form 970. the total of all NOLs generated in prior years the applicable line of Schedule B.
Also check the LIFO box on line 9c. On but not used to offset income (either as a
line 9d, enter the amount of total closing carryback or carryover) to a tax year prior to Lines 1 through 5. Enter the foreign trading
inventories computed under section 472. the current tax year. Do not reduce the gross receipts requested on lines 1 through
Estimates are acceptable. amount by any NOL deduction reported on 5. See section 924 and Foreign Trading
If the FSC changed or extended its line 19a, Part II of Schedule B. Gross Receipts, earlier, for receipts that are
excluded and other details. Report
inventory method to LIFO and had to write up Lines 8c and 9b(2). See Definition of a commission income on line 1 or line 2 based
the opening inventory to cost in the year of Foreign Sales Corporation (FSC), earlier, for on the sale, lease, or rental of property on
election, report the effect of the write-up as definitions of qualifying foreign country and which that commission arose.
other income (as appropriate on Schedule F, U.S. possession.
line 16), proportionately over a 3-year period Line 5. If the 50% gross receipts test of
that begins with the year of the LIFO Line 9. All FSCs (except small FSCs) must section 924(a)(5) is not met, report the FSC's
election. answer these questions. For more gross receipts that would have otherwise
information, see Foreign Management qualified under that section on line 16,
For more information on inventory Rules, earlier. Schedule F, instead of line 5,
valuation methods, see Pub. 538. For more Schedule B.
information on changes in the method of Line 10. All FSCs (except small FSCs) must
accounting for inventory, see Form 3115 and answer these questions. On line 10b, Lines 6b through 6h. See section 924(b)
the Instructions for Form 3115. indicate how the FSC met the foreign direct (2)(B) for the rules regarding the limitation on
costs requirement of section 924(d) for all the amount of foreign trading gross receipts
transactions that generated foreign trading that a small FSC can take into account in
Additional Information gross receipts reported on lines 1 through 5 determining its exempt foreign trade income.
Line 2. Enter any tax-exempt interest of Schedule B. Also, complete line 10a
received or accrued. Include any and/or line 10d to make an election to use Line 6d. Temporary Regulations section
exempt-interest dividends received as a either of the annual grouping election(s) 1.921-1T(b)(5) indicates that, in the case of a
shareholder in a mutual fund or other indicated. See Foreign Economic Process small FSC having a short tax year, the dollar
regulated investment company. Also include Rules, earlier, for details. limitation reported on line 6b or 6c is to be
this amount on Schedule M-1, line 7a. prorated on a daily basis. A small FSC
having a short tax year must divide the
Line 5. If the FSC owned at least a 10% Schedule B number of days in its short tax year by the
interest, directly or indirectly, in any foreign Use Schedule B to compute taxable income number of days that would have made up a
partnership, attach a statement listing the from all sources. full tax year and enter the resulting fraction
following information for each foreign on line 6d as a decimal less than 1.00000.
partnership. For this purpose, a foreign Part I
partnership includes an entity treated as a Use Part I to compute net income attributable Example. For its 2018 calendar year tax
foreign partnership under Regulations to nonexempt foreign trade income. Income year, a small FSC has a short tax year of 73
section 301.7701-2 or 301.7701-3. and expenses on lines 1 through 15 are days. The FSC enters 0.20 (73/365) on
1. Name and EIN (if any) of the foreign reported in column (a) if the administrative line 6d.
partnership; pricing rules were used in the transaction Line 6f. If commission income is reported in
that produced the income. the total for line 6a of Schedule B, total
2. Identify which, if any, of the following receipts for purposes of line 6f are figured as
forms the foreign partnership filed for its tax Report in column (b) all foreign trade follows:
year ending with or within the FSC's tax year: income from all transactions in which the
Form 1042, 1065, or 8804; administrative pricing rules were not used.
Attach a statement that shows the

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1. Enter total of columns (a) and to waive the entire carryback period for line 9. Attach the completed worksheet to
(b), line 6a, Schedule B . . . . 1. farming losses. See the Instructions for Form Form 1120-FSC.
1139 for other special rules and elections.
2. Enter total commission income Line 18. Enter the deductions allocated or
reported on line 1 and line 2, apportioned to line 17 income. Attach to
Schedule B . . . . . . . . . . . 2. Schedule E Form 1120-FSC a statement listing each
3. Subtract line 2 from line 1. . . 3. For purposes of the Note at the top of type of deduction. Show deductions related
Schedule E, a C corporation is a corporation to cost of goods sold separately. See the
4. With respect to the commission other than an S corporation. Shareholders, instructions for Schedule A, earlier, before
income reported on line 2 above, other than C corporations, are individuals, completing this line.
enter total gross receipts on the partnerships, S corporations, trusts, and
sale, lease, or rental of property estates. Passive activity limitations. Section 469
on which the commission income generally limits the deduction of passive
arose (section 927(b)(2)) . . . 4. Use lines 2a through 2d to figure the activity losses for closely held FSCs and
exemption percentage for foreign trade FSCs that are personal service corporations.
5. Add lines 3 and 4. Enter here income determined by not using the See section 469 and the Instructions for
and on line 6f, Schedule B . . 5. administrative pricing rules. See section Form 8810 for details.
923(a)(2).
Instructions for Dividends
Use lines 3a through 3d to figure the and Dividends-Received
Line 6h. When making the line 6h exemption percentage for foreign trade
allocation, allocate only the commission income that was determined by using the Deduction Worksheet
income from the gross receipts on line 4 administrative pricing rules (see section For purposes of the 20% ownership test on
above. If the small FSC's foreign trading 923(a)(3)). If a qualified cooperative is a lines 1 through 7, the percentage of stock
gross receipts for the tax year (line 6f, shareholder of the FSC, see section 923(a) owned by the FSC is based on voting power
Schedule B) exceed its allowable limitation (4). and value of the stock. Preferred stock
(line 6e, Schedule B), the small FSC may described in section 1504(a)(4) is not taken
select the gross receipts to which the into account.
limitation is allocated. In such a case, Schedule F
allocate the amount on line 6g between
columns (a) and (b) on line 6h based on Part I Line 1, Column (a)
whether the administrative pricing rules were Enter net income from nonexempt foreign
used for the gross receipts selected. See trade income and related expenses in Part I. Enter dividends (except those received on
certain debt-financed stock acquired after
Regulations section 1.921-2(b), Q&A-4. Line 2. Enter FSC income that resulted from July 18, 1984–see section 246A) that:
Part II the FSC's cooperation with an international • Are received from less-than-20%-owned
boycott. See section 927(e)(2) and Form domestic corporations subject to income tax,
Line 19a. Net operating loss deduction. 5713 and related schedules and instructions. and
A FSC may use the NOL incurred in one tax • Qualify for the 50% deduction under
year to reduce its taxable income in another Line 3. Enter the amount, if any, of illegal section 243(a)(1).
tax year. Enter on line 19a the total NOL payments, bribes, or kickbacks that the FSC
carryovers from other tax years, but do not paid, directly or indirectly, to government
enter more than the FSC's taxable income officials, employees, or agents. See section Also include on line 1 dividends (except
(after the dividends-received deduction). 927(e)(2). those received on certain debt-financed
stock acquired after July 18, 1984) from a
Attach a statement showing the computation Line 5. See the instructions for Schedule A regulated investment company (RIC). The
of the NOL deduction. Also complete line 7 before completing this line. amount of dividends eligible for the
in Additional Information on page 2 of the dividends-received deduction under section
form. Part II 243 is limited by section 854(b). The FSC
For more details on the NOL deduction, Enter the taxable portion of gross income of should receive a notice from the RIC
see section 172 and the Instructions for the FSC that was not derived from foreign specifying the amount of dividends that
Form 1139. trading gross receipts. This type of income qualify for the deduction.
includes:
Line 19b. Dividends-received deduction. • Small FSCs only. Amounts specifically Report so-called dividends or earnings
A FSC may be entitled to a deduction for excluded from foreign trade income because received from mutual savings banks, etc., as
dividends it receives from other corporations. of the small FSC limitation (the amount by interest. Do not treat them as dividends.
Complete the worksheet on page 12 using which line 6f of Schedule B exceeds line 6e
the Instructions for Dividends and of Schedule B). (Enter the excess, if any, on
Dividends-Received Deduction Worksheet, line 7 of Schedule F.) Line 2, Column (a)
later. Attach the completed worksheet to • Investment type income. (Enter on lines 8 Enter dividends (except those received on
Form 1120-FSC. through 12 of Schedule F.) certain debt-financed stock acquired after
Line 20. Taxable income or (loss). If • Income from property that is subsidized, July 18, 1984) that are received from
line 20 is zero or less, the FSC may have an deemed in short supply, or destined for use 20%-or-more-owned domestic corporations
NOL that may be carried back or forward as in the United States. (Enter on lines 13 and subject to income tax and that are subject to
a deduction to other tax years. 14 of Schedule F.) the 65% deduction under section 243(c).
NOLs incurred in tax years ending after • Amounts from transactions that did not
meet the foreign economic process
2017 generally can only be carried forward. requirements. (Enter on line 15 of Line 3, Column (a)
Exceptions apply to NOLs from a farming Schedule F.) Enter the following.
loss and NOLs of insurance companies other • Other nonforeign trade income. (Enter on • Dividends received on certain
than life insurance companies, which are line 16 of Schedule F.) debt-financed stock acquired after July 18,
carried back two years. For NOLs that can
be carried back, the FSC may elect to waive For more details, see sections 924(f) and 1984, from domestic and foreign
the carryback period and instead carry the 927(a)(2) and (3). corporations subject to income tax that
NOL forward to future tax years. See the would otherwise be subject to the
instructions for Additional Information, line 6, Line 9. Complete the Dividends and dividends-received deduction under section
earlier, for information on making the election Dividends-Received Deduction Worksheet, 243(a)(1), 243(c), or 245(a). Generally,
later, to figure the total dividends to report on debt-financed stock is stock that the FSC

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acquired by incurring a debt (for example, it apply, even if the loss is created by the count certain days during which the FSC's
borrowed money to buy the stock). dividends-received deduction. See sections risk of loss was diminished. See section
• Dividends received from a RIC on 172(d) and 246(b). 246(c)(4) and Regulations section 1.246-5
debt-financed stock. The amount of for more details.
dividends eligible for the dividends-received 1. Refigure line 18, Part II, b. Dividends attributable to periods
deduction is limited by section 854(b). The Schedule B (page 3 of Form totaling more than 366 days that the FSC
FSC should receive a notice from the RIC 1120-FSC) without any received on any share of preferred stock
specifying the amount of dividends that adjustment under section 1059 held for less than 91 days during the 181-day
qualify for the deduction. and without any capital loss period that began 90 days before the
carryback to the tax year under ex-dividend date. When counting the number
Line 3, Columns (b) and (c) section 1212(a)(1) . . . . . . . 1. of days the FSC held the stock, you may not
Dividends received on certain debt-financed 2. Multiply line 1 by 65% count certain days during which the FSC's
stock acquired after July 18, 1984, are not (0.65) . . . . . . . . . . . . . . 2. risk of loss was diminished. See section
246(c)(4) and Regulations section 1.246-5
entitled to the full 50% or 65% 3. Add lines 2, 5, and 7, column for more details. Preferred dividends
dividends-received deduction under section (c), and the part of the deduction attributable to periods totaling less than 367
243 or 245(a). The 50% or 65% deduction is on line 3, column (c), that is days are subject to the 46-day holding period
reduced by a percentage that is related to attributable to dividends from rule above.
the amount of debt incurred to acquire the 20%-or-more-owned
stock. See section 246A. Also, see section corporations . . . . . . . . . . 3. c. Dividends on any share of stock to
245(a) before making this computation for an 4. Enter the smaller of line 2 or the extent the FSC is under an obligation
additional limitation that applies to certain line 3. If line 3 is greater than (including a short sale) to make related
dividends received from foreign line 2, stop here; enter the payments with respect to positions in
corporations. Attach a statement to Form amount from line 4 on line 8, substantially similar or related property.
1120-FSC showing how the amount on column (c), and do not complete 5. Any other taxable dividend income
line 3, column (c), was figured. lines 5–10 below . . . . . . . . 4. not properly reported elsewhere on the
5. Enter the total amount of Dividends and Dividends-Received
Line 4, Column (a) dividends from Deduction Worksheet.
Enter dividends received on the preferred 20%-or-more-owned If patronage dividends or per-unit retain
stock of a less-than-20%-owned public utility corporations that are included allocations are included on line 10, identify
that is subject to income tax and is allowed on lines 2, 3, 5, and 7, column the total of these amounts in a statement
the 23.3% deduction provided in sections (a) . . . . . . . . . . . . . . . . 5. attached to Form 1120-FSC.
244 and 247 (as affected by P.L. 113-295, 6. Subtract line 5 from line 1 . . . 6.
Schedule G
Div. A, section 221(a)(41)(A), Dec. 19, 2014, 7. Multiply line 6 by 50%
128 Stat. 4043) for dividends paid. (0.50) . . . . . . . . . . . . . . 7. Limitations on Deductions
8. Subtract line 3 above from line 8,
Line 5, Column (a) column (c) . . . . . . . . . . . 8. Section 263A uniform capitalization
rules. The uniform capitalization rules of
Enter dividends received on preferred stock 9. Enter the smaller of line 7 or section 263A require FSCs to capitalize
of a 20%-or-more-owned public utility that is line 8. . . . . . . . . . . . . . . 9. certain costs to inventory or other property.
subject to income tax and is allowed the In general, FSCs subject to the section 263A
26.7% deduction provided in sections 244 10. Dividends-received deduction
and 247 (as affected by P.L. 113-295, Div. A, after limitation (sec. 246(b)). uniform capitalization rules are required to
section 221(a)(41)(A), Dec. 19, 2014, 128 Add lines 4 and 9. Enter the capitalize:
Stat. 4043) for dividends paid. result here and on line 8, column 1. Direct costs of property produced or
(c) . . . . . . . . . . . . . . . . 10. acquired for resale, and
Line 6, Column (a) 2. Certain indirect costs (including
taxes) that are properly allocable to property
Enter the U.S.-source portion of dividends produced or property acquired for resale.
that: Line 10, Column (a)
Indirect costs properly allocable to
• Are received from less-than-20%-owned Include the following. property acquired for resale are generally
foreign corporations, and
• Qualify for the 50% deduction under 1. Dividends (other than capital gain those costs in the following categories:
section 245(a). To qualify for the 50% distributions reported on Schedule D (Form • Off-site storage or warehousing.
deduction, the FSC must own at least 10% of 1120) and exempt-interest dividends) that • Purchasing.
the stock of the foreign corporation by vote are received from RICs and that are not • Handling, such as processing,
and value. subject to the 50% deduction. assembling, repackaging, and transporting.
2. Dividends from tax-exempt • General and administrative costs (mixed
Line 7, Column (a) organizations. service costs).
For details, see Regulations section
Enter the U.S.-source portion of dividends 3. Dividends (other than capital gain 1.263A-3(d).
that are received from 20%-or-more-owned distributions) received from a real estate
foreign corporations and that qualify for the investment trust that, for the tax year of the In general, the FSC cannot deduct the
65% deduction under sections 243 and trust in which the dividends are paid, costs required to be capitalized under
245(a). qualifies under sections 856 through 860. section 263A until it sells, uses, or otherwise
4. Dividends not eligible for a disposes of the property (to which the costs
dividends-received deduction, which include relate). The FSC recovers these costs
Line 8, Column (c) the following. through depreciation, amortization, or costs
of goods sold.
Limitation on dividends-received deduc- a. Dividends received on any share of
tion. Generally, line 8, column (c), may not stock held for less than 46 days during the Note. Effective for tax years beginning after
exceed the amount on line 10 of the 91-day period beginning 45 days before the 2017, a small business taxpayer (defined
worksheet below. However, in a year in ex-dividend date. When counting the number earlier) is not required to capitalize costs
which an NOL occurs, this limitation does not of days the FSC held the stock, you may not under section 263A. A small business

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taxpayer that wants to discontinue               Line 10. Compensation of officers.                                     Enter corporations. Also, see the Instructions for 
capitalizing costs under section 263A must       deductible officers' compensation on line 10.                                Form 1120.
change its method of accounting. See             Do not include compensation deductible 
section 263A(i). Also see Change in              elsewhere on the return, such as amounts                                     Schedule J
accounting method, earlier.                      included in cost of goods sold, elective 
For more information on the uniform              contributions to a section 401(k) cash or                                    Line 1
capitalization rules, see Pub. 538. For          deferred arrangement, or amounts                                             If the FSC is a member of a controlled group, 
non-small business taxpayers, see                contributed under a salary reduction SEP                                     as defined in section 927(d)(4), it must check 
Regulations sections 1.263A-1 through            agreement or a SIMPLE IRA plan. See the                                      the box on line 1 and complete Schedule O 
1.263A-3.                                        Instructions for Form 1125-E for more                                        (Form 1120). See Schedule O and its 
                                                 information on officers' compensation,                                       instructions for more information.
Transactions between related taxpayers.          including any special rules and limitations 
Generally, an accrual basis taxpayer may         that may apply. You are not required to                                      Line 2
only deduct business expenses and interest       complete Form 1125-E or attach it to Form                                    For tax years beginning in 2018, FSCs, 
owed to a related party in the year the          1120-FSC.                                                                    including FSCs that are qualified personal 
payment is included in the income of the                                                                                      service corporations (as defined in section 
related party. See sections 163(e)(3) and        Line 14. Other deductions.                                     Attach a 
267(a)(2) for limitations on deductions for      statement, listing by type and amount, all                                   448(d)(2)), figure their tax by multiplying 
unpaid interest and expenses.                    allowable deductions that are not deductible                                 taxable income (Schedule B, line 20) by 
                                                 elsewhere on Form 1120-FSC. Enter the                                        21%. Enter this amount on line 2.
Limitations on business interest ex-             total on line 14.                                                            Line 3
pense.  Business interest expense is limited       Examples of other deductions include:                                      If the corporation had gross receipts of at 
for tax years beginning after December 31,       • Amortization (see Form 4562).                                              least $500 million in any one of the 3 tax 
2017. See section 163(j) and Form 8990.          • Insurance premiums.                                                        years preceding the current tax year, 
Line 1. Enter only foreign direct costs on       • Legal and professional fees.                                               complete and attach Form 8991. Enter on 
lines 1a through 1e. See section 924(e) and      • Supplies used and consumed in the                                          line 3 the base erosion minimum tax from 
Regulations sections 1.924(e)-1(a) through       business.                                                                    Form 8991, Part IV, line 5e. See section 59A 
(e) for definitions and rules on direct activity • Utilities.                                                                 and the Instructions for Form 8991.
costs related to foreign trade income.             Do not deduct:
Line 5. Salaries and wages. Enter the total      • Fines or penalties paid to a government or                                 Line 5
salaries and wages paid for the tax year. Do     government entity for violating any law or for                               Foreign tax credit. Generally, a FSC may 
not include salaries and wages deductible        government investigations into potential                                     not claim a foreign tax credit. It may, 
elsewhere on the return, such as amounts         violations of the law. However, see section                                  however, claim a foreign tax credit for any 
included in officers' compensation, cost of      162(f) for exceptions to the general rule.                                   foreign taxes imposed on foreign source 
goods sold, elective contributions to a          • Any amount that is allocable to a class of                                 taxable nonforeign trade income 
section 401(k) cash or deferred                  exempt income. See section 265(b) for                                        (Schedule F, Part II) that is treated as 
arrangement, or amounts contributed under        exceptions.                                                                  effectively connected with a U.S. trade or 
a salary reduction SEP agreement or a              See Pub. 535 and Pub. 542 for details on                                   business. See Temporary Regulations 
SIMPLE IRA plan.                                 other deductions that may apply to                                           section 1.921-3T(d)(2) for more details.

Dividends and Dividends-Received Deduction Worksheet                                                                                   Keep for Your Records
(See Instructions for Dividends and Dividends-Received Deduction Worksheet, earlier.)                                                             (c) 
                                                                                                                         (a) Dividends            Dividends-received 
                                                                                                                         received       (b) %     deduction: (a) (b) x 
1    Dividends from less-than-20%-owned domestic corporations (other than 
     debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                           50
2    Dividends from 20%-or-more-owned domestic corporations (other than 
     debt-financed stock) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                           65
3    Dividends on certain debt-financed stock of domestic and foreign corporations 
     (section 246A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                         See Inst.
4    Dividends on certain preferred stock of less-than-20%-owned public 
     utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  23.3
5    Dividends on certain preferred stock of 20%-or-more-owned public 
     utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                  26.7
6    Dividends from less-than-20%-owned foreign corporations . . . . . . . . . . . . . . . .                                            50
7    Dividends from 20%-or-more-owned foreign corporations . . . . . . . . . . . . . . . .                                              65
8 Total dividends-received deduction. Add lines 1 through 7. See instructions for 
     limitation. Enter here and on Schedule B, line 19b . . . . . . . . . . . . . . . . . . . . . .                    ▶
9    Other dividends from foreign corporations not included on line 3, 6, or 7 . . . . . . .
10   Other dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11 Total dividends. Add lines 1 through 10. Enter here and on 
     Schedule F, line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        ▶

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Schedule L If the total adjustment to be entered on • Employee achievement awards of
line 27 is a negative amount, enter the nontangible or tangible property over $400
The balance sheet should agree with the amount in parentheses. ($1,600 if part of a qualified plan).
FSC's books and records. Include The cost of skyboxes.
certificates of deposit as cash on line 1, •
Schedule L. Schedule M-1 • Nondeductible club dues.
• The part of luxury water travel expenses
Line 5. Tax-exempt securities. Include on Line 5c. Travel and entertainment. not deductible under section 274(m).
this line: Include on line 5c any of the following. • Expenses for travel as a form of
• State and local government obligations, • Entertainment expenses not deductible education.
the interest on which is excludible from gross under section 274(a). • Other nondeductible travel and
income under section 103(a) and • Entertainment-related meal expenses. entertainment expenses.
• Stock in a mutual fund or other regulated • Non-entertainment meal expenses not For more information, see Pub. 535.
investment company that distributed deductible under section 274(n).
exempt-interest dividends during the tax year • Expenses for the use of an entertainment Line 7a. Tax-exempt interest. Report any
of the FSC. facility. tax-exempt interest received or accrued,
• The part of business gifts over $25. including any exempt-interest dividends
Line 27. Adjustments to shareholders' • Expenses of an individual over $2,000, received as a shareholder in a mutual fund or
equity. Some examples of adjustments to which are allocable to conventions on cruise other regulated investment company. Also
report on this line include: ships. report this amount on line 2, Additional
• Foreign currency translation adjustments. Information, on page 2 of the form.
• The excess of additional pension liability
over unrecognized prior service cost.

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Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. You
are required to give us the information. We need it to ensure that you are complying with these laws and to allow us to figure and collect the
right amount of tax.
You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form
displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may
become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required
by section 6103.
The time needed to complete and file this form and related schedule will vary depending on individual circumstances. The estimated
burden for taxpayers filing this form and schedule is approved under OMB control number 1545-0123 and is included in the estimates shown
in the Instructions for Form 1120.
If you have comments concerning the accuracy of these time estimates or suggestions for making this form and related schedule simpler,
we would be happy to hear from you. You can send us comments through IRS.gov/FormComments. Or you can write to the Internal Revenue
Service, Tax Forms and Publications, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send the tax form to this address.
Instead, see Where To File, earlier.

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Forms 1120-FSC                                                            Using the list of activities and codes below, determine       Once the principal business activity is determined, 
                                                                 from which activity the FSC derives the largest percentage         entries must be made on Form 1120-FSC, page 2, 
Principal Business Activity Codes                                of its “total receipts.” Total receipts is defined as the sum of   Additional Information, lines 1a, 1b, and 1c. For the 
                                                                 the foreign trading gross receipts on Form 1120-FSC,               business activity code number, enter the six digit code 
This list of principal business activities and their associated  page 3, Schedule B, line 6a, and the total income on               selected from the list below. On line 1b, enter a brief 
codes is designed to classify an enterprise by the type of       page 4, Schedule F, lines 4 and 17. If the FSC's largest           description of the FSC's business activity. Finally, enter a 
activity in which it is engaged to facilitate the administration percentage of its total receipts is derived from the               description of the principal product or service of the FSC on 
of the Internal Revenue Code. These principal business           wholesale trading of durable goods, the FSC must use one           line 1c.
activity codes are based on the North American Industry          of the corresponding codes from the list below 
Classification System.                                           (423100-423990).
Wholesale Trade                          424300                  Apparel, Piece Goods, & Notions     511190 Other Publishers                     Rental and Leasing
Merchant Wholesalers, Durable Goods      424400                  Grocery & Related Products          511210 Software Publishers                  Rental and Leasing Services
423100 Motor Vehicle & Motor Vehicle     424500                  Farm Product Raw Materials          Motion Picture and Sound Recording          532100  Automotive Equipment Rental & 
       Parts & Supplies                  424600                  Chemical & Allied Products          Industries                                          Leasing
423200 Furniture & Home Furnishings      424700                  Petroleum & Petroleum Products      512100 Motion Picture & Video Industries    532210  Consumer Electronics & 
423300 Lumber & Other Construction       424800                  Beer, Wine, & Distilled Alcoholic          (except video rental)                        Appliances Rental
       Materials                                                 Beverages                           512200 Sound Recording Industries           532220  Formal Wear & Costume Rental
423400 Professional & Commercial         424910                  Farm Supplies                       Broadcasting (except Internet)              532230  Video Tape & Disc Rental
       Equipment & Supplies              424920                  Book, Periodical, & Newspapers      515100 Radio & Television Broadcasting      532290  Other Consumer Goods Rental
423500 Metal & Mineral (except           424930                  Flower, Nursery Stock, & Florists'  515210 Cable & Other Subscription           532310  General Rental Centers
       Petroleum)                                                Supplies                                   Programming
423600 Electrical & Electronic Goods     424940                  Tobacco & Tobacco Products          Telecommunications                          532400  Commercial & Industrial Machinery 
423700 Hardware, Plumbing & Heating      424950                  Paint, Varnish, & Supplies          517000 Telecommunications (including                & Equipment Rental & Leasing
       Equipment & Supplies              424990                  Other Miscellaneous Nondurable             paging, cellular, satellite, cable & Professional Services
423800 Machinery, Equipment, & Supplies                          Goods                                      other program distribution,          Architectural, Engineering, and Related 
                                                                                                            resellers, other 
423910 Sporting & Recreational Goods &   Wholesale Electronic Markets and Agents                            telecommunications & internet        Services
       Supplies                          and Brokers                                                        service providers)                   541310  Architectural Services
423920 Toy & Hobby Goods & Supplies      425110                  Business to Business Electronic     Data Processing Services                    541320  Landscape Architecture Services
423930 Recyclable Materials                                      Markets                             518210 Data Processing, Hosting, &          541330  Engineering Services
423940 Jewelry, Watch, Precious Stone, & 425120                  Wholesale Trade Agents & Brokers           Related Services                     541340  Drafting Services
       Precious Metals                   Information                                                 Other Information Services                  541350  Building Inspection Services
423990 Other Miscellaneous Durable       Publishing Industries (except Internet)                     519100 Other Information Services           541360  Geophysical Surveying & Mapping 
       Goods                                                                                                (including news syndicates,                  Services
Merchant Wholesalers, Nondurable         511110                  Newspaper Publishers                       libraries, internet publishing &     541370  Surveying & Mapping (except 
Goods                                    511120                  Periodical Publishers                      broadcasting)                                Geophysical) Services
424100 Paper & Paper Products            511130                  Book Publishers                                                                 541380  Testing Laboratories
424210 Drugs & Druggists' Sundries       511140                  Directory & Mailing List Publishers                                             Other Professional Services
                                                                                                                                                 541600  Management Consulting Services

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