Some U.S. taxpayers may be required by I.R.C. § 6038 to file Form 5471 (Information Return of U.S. Persons With Respect to Certain Foreign Corporations) with their tax returns. To adhere to the reporting requirements of § 6038, as well as § 6046, Form 5471 is required to be filed by certain U.S. persons who are officers, directors, or shareholders in certain foreign corporations.
A person required to file Form 5471 who fails to file the form, or files a late or incomplete form, is not only subject to substantial monetary penalties, but the statute of limitations on assessment for the taxpayer’s entire return remains open until three years after the required information is submitted to the IRS.
Neither the Code nor the regulations provide rules to determine when a taxpayer has substantially complied with the Form 5471 filing requirements. While, the IRS has provided guidance in an LB&I International Practice Service Process Unit on what constitutes substantial compliance for taxpayers required to file this form, any taxpayer required to file Form 5471 should enlist the assistance and guidance of an experienced and knowledgeable tax professional. The Thorgood Law Firm is available to help U.S. taxpayers with interests in foreign assets and foreign business entities meet all of their Form 8938, Form 5471, and FBAR requirements.
Qualifying U.S. persons must complete the schedules, statements, and other information requested by Form 5471, which must then be attached to and filed with the income tax return that a particular taxpaying person or entity is required to file such as:
- Form 1040, S. Individual Income Tax Return;
- Form 1120, S. Corporation Income Tax Return;
- Form 1065, S. Return of Partnership Income; or
- Form 990, Return of Organization Exempt From Income Tax).
The reporting period during which the required information is provided is the annual accounting period of the foreign corporation ending with or within the U.S. person’s tax year.
If you have questions about the timely or delinquent filing of a Form 5471, contact THE TAX EXPERTS at the Thorgood Law Firm www.thorgoodlaw.com. For a FREE consultation, call 212-490-0704.
