Do not include taxes deemed paid by the foreign corporation with respect to its receipt of a PTEP distribution. Do not complete a separate Schedule E for taxes assigned to the section 951A category. 2019-40 for more details. Check the box in column (xiv) of the line corresponding to any item of income with respect to which the subpart F high-tax exception applies. Attach a statement that includes an explanation and the dollar amount of each such adjustment, along with a total that equals the amount entered on line 1b. Enter the tax in functional currency. Because a CFC cannot earn section 951A category income or foreign branch category income at the CFC level, there is no tested income group within either section 904 category. 2019-40 for definitions of terms. A CFC's investment in U.S. property in excess of this limit will not be included in the taxable income of the CFC's U.S. shareholders. Line 3 should never have an amount entered in column (e). CFC2, in turn, wholly owns the only class of stock of CFC3, a foreign corporation. Section 965 specified foreign corporation (SFC). In Part I, Section 1, list income, war profits, and excess profits taxes (income taxes) paid or accrued to each foreign country or U.S. possession for the foreign corporations foreign tax year(s) that end with or within its U.S. tax year. The line 4 result can be positive or negative. Form 5471 (Schedule G-1) Cost Sharing Arrangement. If there is an income tax benefit amount on line 21a or 21b, add that amount to the line 19 net income or (loss) amount in arriving at line 22 current year net income or (loss) per the books. Specifically, if the foreign corporation was a controlled participant (as defined in Regulations section 1.482-7(j)) in more than one cost sharing arrangement (as defined in Regulations section 1.482-7(b)) during the tax year, the filer is required to complete Schedule G-1 for each cost sharing arrangement. See Regulations section 1.6046-1(i) for rules on determining when U.S. persons constructively own stock of a foreign corporation and therefore are subject to the section 6046 filing requirements. IRS Form 5471 - Beginner Series Schedule E-1: Taxes Paid or Deemed Paid - IRS Form 5471 Jason D. Knott 7.74K subscribers Join Subscribe 17 Share 843 views 3 months ago Schedule E-1. If the filer is a direct owner, include the filer's direct ownership. Corporation A has a section 951A inclusion of $20 because its pro rata share of CFC1s tested income ($50x) is offset by its pro rata share of CFC2s tested loss ($30x). See the instructions for Form 5471, Schedule I, Vegetable & Melon Farming (including potatoes & yams), Greenhouse, Nursery, & Floriculture Production, Other Crop Farming (including tobacco, cotton, sugarcane, hay, peanut, sugar beet & all other crop farming), Aquaculture (including shellfish & finfish farms & hatcheries), Forest Nurseries & Gathering of Forest Products, Support Activities for Crop Production (including cotton ginning, soil preparation, planting, & cultivating), Sand, Gravel, Clay, & Ceramic & Refractory Minerals Mining & Quarrying, Other Nonmetallic Mineral Mining & Quarrying, Electric Power Generation, Transmission & Distribution, Other Heavy & Civil Engineering Construction, Foundation, Structure, & Building Exterior Contractors (including framing carpentry, masonry, glass, roofing, & siding), Plumbing, Heating, & Air-Conditioning Contractors, Building Finishing Contractors (including drywall, insulation, painting, wallcovering, flooring, tile, & finish carpentry), Other Specialty Trade Contractors (including site preparation), Fruit & Vegetable Preserving & Specialty Food Mfg, Other Food Mfg (including coffee, tea, flavorings & seasonings), Women's, Girls' & Infants' Cut & Sew Apparel Mfg, Footwear Mfg (including rubber & plastics), Veneer, Plywood, & Engineered Wood Product Mfg, Petroleum Refineries (including integrated), Asphalt Paving, Roofing, & Saturated Materials Mfg, Resin, Synthetic Rubber, & Artificial & Synthetic Fibers & Filaments Mfg, Pesticide, Fertilizer, & Other Agricultural Chemical Mfg, Soap, Cleaning Compound, & Toilet Preparation Mfg, Alumina & Aluminum Production & Processing, Nonferrous Metal (except Aluminum) Production & Processing, Machine Shops; Turned Product; & Screw, Nut, & Bolt Mfg, Coating, Engraving, Heat Treating, & Allied Activities, Agriculture, Construction, & Mining Machinery Mfg, Commercial & Service Industry Machinery Mfg, Ventilation, Heating, Air-Conditioning, & Commercial Refrigeration Equipment Mfg, Engine, Turbine & Power Transmission Equipment Mfg, Semiconductor & Other Electronic Component Mfg, Navigational, Measuring, Electromedical, & Control Instruments Mfg, Manufacturing & Reproducing Magnetic & Optical Media, Other Electrical Equipment & Component Mfg, Furniture & Related Product Manufacturing, Motor Vehicle & Motor Vehicle Parts & Supplies, Professional & Commercial Equipment & Supplies, Household Appliances & Electrical & Electronic Goods, Hardware & Plumbing & Heating Equipment & Supplies, Jewelry, Watch, Precious Stone, & Precious Metals, Beer, Wine, & Distilled Alcoholic Beverages, Flower, Nursery Stock, & Florists' Supplies, Motorcycle, ATV, & All other Motor Vehicle Dealers, Automotive Parts, Accessories, & Tire Stores, Electronic Stores (including Audio, Video, Computer, & Camera Stores), Lawn & Garden Equipment & Supplies Stores, Supermarkets and Other Grocery (except Convenience) Stores, Cosmetics, Beauty Supplies, & Perfume Stores, Gasoline Stations (including convenience stores with gas), General Merchandise Stores, incl. A foreign corporation may have PTEP in a PTEP group within any of the separate categories of income, with the exception of foreign branch category income. If so, did the foreign corporation derive any item of income, gain, deduction, or loss (other than any item described in section 954(c)(1)(A), (E), or (G)) from any transaction entered into in the ordinary course of its trade or business as a regular dealer? For example, an individual U.S. shareholder who receives a distribution of PTEP originally attributable to inclusions under section 965(a) may only claim a credit for a portion of the foreign taxes attributable to a distribution of such PTEP. See section 381(c)(2)(B) and Regulations sections 1.367(b)-7(d)(2)(i) (post-1986 undistributed earnings) and 1.367(b)-7(e)(1) (pre-1987 E&P not previously taxed). A person that is both a category 3 and category 5 filer because it is treated as a U.S. shareholder under section 953(c)(1)(A) with respect to the foreign corporation must complete Schedule B, Part 1 for U.S. persons that owned (on the last day of the foreign corporations taxable year), directly or indirectly through foreign entities, any of the foreign corporation's outstanding stock. A separate Schedule G-1 must be filed for each cost sharing arrangement (CSA) as defined in Regulations section 1.482-7(b) in which the foreign corporation was a controlled participant (as defined in Regulations section 1.482-7(j)) during the tax year. Category 1c and 5c filers should list all direct owners of the SFC or CFC from which such filer is attributed ownership in the SFC or CFC as described in section 958(b). See Rev. Subtract the sum of lines 33 and 34 from the sum of lines 16e, 18e, 19e, 20, 21, and 22." Tentative section 956 amount. Any liability to which the property is subject immediately before, and immediately after, the distribution. For the foreign corporations annual accounting period with respect to which reporting is being made on this Form 5471, if the foreign corporation is required to file a U.S. income tax return (for example, Form 1120F), check the Yes box if the foreign corporation has interest expense disallowed under section 163(j). Use Schedule Q to report the CFCs income, deductions, taxes, and assets by CFC income groups for purposes of sections 960(a) and (d). For example, the taxpayer may still be required to complete a Form 1116 or a Form 1118, and/or a Form 5471 (including Schedule J and Schedule P), and separately report passive category income and section 951A category income. The above rules apply with respect to amounts received for services under a particular contract only if at some time during the tax year 25% or more in value of the outstanding stock of the corporation is owned, directly or indirectly, by or for the individual who has performed, is to perform, or may be designated (by name or by description) as the one to perform, such services. Section 6 of Rev. A U.S. person who disposes of sufficient stock in the foreign corporation to reduce his or her interest to less than the 10% stock ownership requirement. Enter the appropriate code on line a (at the top of page 1 of Schedule J). field, "37.Current E&P limitation computation:" field, "37b.Tested loss (enter as a positive numbersee instructions)"field, "37c.Total of line 37a and line 37b"field, "38.Enter the smaller of line 36 or line 37c" field, "39.If the amount on line 37c is less than the amount on line 36, allocate the subpart F income remaining (after having been limited) to lines 40, 41, 42, and 43 below in the manner prescribed by Regulations section 1.952-1(e). See the instructions for, An interest in a trust, partnership, or REMIC; however, see the instructions for, If the sum of foreign base company income (determined without regard to section 954(b)(5)) and gross insurance income (as defined in section 954(b)(3)(C)) for the tax year is, The name of the person filing Form 5471 is generally the name of the U.S. person described in the applicable category or categories of filers (see, Complete a separate Schedule E for each applicable separate category of income. Attach a statement explaining why such taxes were not deemed paid under section 960. Note that the rules contained in these regulations have later effective dates. .All persons identified in Item H must complete a separate Schedule P (Form 5471) if the person is a U.S. shareholder described in Category 1a, 1b, 4, 5a, or 5b. Include all derivatives, both short-term and long-term. Do not report such taxes in Part I, but in Part III. Cosponsors added, H1014 [7FE] From the Congressional Record, Volume 167 (2021) Attach a statement detailing the nature and amount of any adjustments in E&P not accounted for on lines 8 through 11. For more information, see Regulations section 1.6011-4. Insurance income is any income attributable to the issuing (or reinsuring) of any insurance or annuity contract that would (subject to the modifications provided in section 953(b)) be taxed under subchapter L (insurance company tax) if such income were income of a domestic insurance company. In the case of an entity classification election that is made on behalf of a foreign corporation on Form 8832, Regulations section 301.6109-1(b)(2)(v) requires the foreign corporation to have an EIN for this election. No changes have been made to Schedule O (Form 5471). (c) Identifying number of shareholder. Adjusted basis in any property must be determined by using the alternative depreciation system under section 168(g) and allocating depreciation deductions with respect to such property ratably to each day during the period in the taxable year to which such depreciation relates. On pages 2 and 3, Schedule E-1 now requests all amounts to be entered in U.S. dollars. So, if necessary, enter negative amounts on line 15 of columns (a), (b), and (c) in amounts sufficient to reduce line 13, columns (a), (b), and (c) to zero. Finally, on Schedule G, new question 18 is asked to determine if the taxpayer has selected the safe haven rules of Regulations sections 1.482-2(a) (2)(iii)(B) and new question 19 is asked to determine if the filer has made distributions or acquisitions that are funded by a related party loan. Check the Yes box if during the tax year the reporting corporation had any loans to or from the related party to which the safe haven rate rules of Regulations section 1.482-2(a)(2)(iii)(B) are applicable, and for which the reporting corporation used a rate of interest within the safe-haven range of Regulations section 1.482-2(a)(2)(iii)(B)(1) (100% to 130% of the AFR for the relevant term). For example, a cash distribution of $100 that is a nontaxable distribution of PTEP under section 959(a) of $30, a taxable dividend eligible for a dividends received deduction under section 245A of $15, a taxable dividend under section 301(c)(1) of $25, a nontaxable distribution applied against basis under section 301(c)(2) of $10, and a taxable distribution treated as gain from the sale or exchange of property under section 301(c)(3) of $20, would be reported on five rows. A U.S. shareholder who is a Category 1 filer (defined previously) and who is an unrelated section 958(a) U.S. shareholder with respect to a foreign-controlled corporation (defined below) may complete Form 5471 for that foreign-controlled corporation and complete only the information required of a Category 1b filer. A foreign corporation may qualify as an expatriated foreign subsidiary under Regulations section 1.7874-12(a)(9) if such foreign corporation is a CFC with respect to which an expatriated entity, as defined in Regulations section 1.7874-12(a)(8) is a U.S. shareholder. 5 Generally, certain U.S. persons must complete the schedules, statements, and/or other information requested. Category 4 and 5 filers are not required to file a Form 5471 (in order to satisfy the requirements of section 6038) if the FSC has filed a Form 1120-FSC. The purpose of this new line is to eliminate the need for an attachment to this separate Schedule H. The instructions for Schedule H, line 2i, have been revised to clarify that taxpayers must report an adjustment if U.S. GAAP income reported on Schedule C includes any expenses or income related to PTEP that should not be included in current year E&P. Page Last Reviewed or Updated: 20-Apr-2022, Request for Taxpayer Identification Number (TIN) and Certification, Employers engaged in a trade or business who pay compensation. 1167, General Rules and Specifications for Substitute Forms and Schedules, which reprints the most recent applicable revenue procedure. Step 1: Go to IRS website and download say 2018 form 5471 or 2017 form 5471. Invested in U.S. Property. The amount of U.S. property held (directly or indirectly) by the CFC does not include any item that was acquired by the foreign corporation before it became a CFC, except for the property acquired before the foreign corporation became a CFC that exceeds the applicable earnings (as defined in section 956(b)) accumulated during periods before it became a CFC. For the first year that Form 5471 is filed after an entity classification election is made on behalf of the foreign corporation on Form 8832, the new EIN must be entered on line 1b(1) of Form 5471 and the old reference ID number must be entered on line 1b(2). Enter the exchange rate in column (k) and the translated dollar amount in column (l). See the instructions for lines 1 and 4. corporation, you could be required to file Form 5471 and/or Form 926. A potential section 951(a)(1)(B) inclusion results in a reclassification of section 959(c)(2) PTEP, if any, to section 959(c)(1) PTEP before reclassification out of the section 959(c)(3) E&P balance. This correlation requirement applies only to the first year the new reference ID number is used. A U.S. person (see Category 2 Filer, above, for definition) who acquires stock in a foreign corporation which, when added to any stock owned on the date of acquisition, meets the 10% stock ownership requirement (described above) with respect to the foreign corporation; A U.S. person who acquires stock which, without regard to stock already owned on the date of acquisition, meets the 10% stock ownership requirement with respect to the foreign corporation; A person who is treated as a U.S. shareholder under section 953(c) with respect to the foreign corporation; A person who becomes a U.S. person while meeting the 10% stock ownership requirement with respect to the foreign corporation; or. For the foreign corporations annual accounting period with respect to which reporting is being made on this Form 5471, if the foreign corporation is required to file a U.S. income tax return (for example, Form 1120F), check the Yes box if the foreign corporation has previously disallowed interest expense under section 163(j) carried forward to the current tax year. Mr. Lyons would prepare a list showing the corporations as follows. Identify which, if any, of the following forms the foreign partnership filed for its tax year ending with or within the corporation's tax year: Form 1042, 1065, or 8804. Subtract the sum of lines 27 and 28 from line 14e." If there are multiple reasons for differences, include the explanation and amount of each such difference on the attachment. 2019-40, Item HPerson(s) on Whose Behalf This Information Return Is Filed, Items 1f and 1gPrincipal Business Activity, Reporting Amounts on Lines 1 Through 4 on Your Income Tax Return, Part ITaxes for Which a Foreign Tax Credit Is Allowed, Section 1Taxes Paid or Accrued Directly by Foreign Corporation, Section 2Taxes Deemed Paid (Section 960(b)), Part IIITaxes for Which Foreign Tax Credit Is Disallowed, Specific Instructions Related to Lines 1 through 16. "field, "1. See Regulations sections 1.6038-1(j) and 1.6038-2(k)(3) for alleviation of this penalty in certain cases. This amount must be converted from functional currency to U.S. dollars using the average exchange rate for the year of the CFC. For each Category 4, 5a, or 5b filer that is required to file a Schedule I, send a copy of their separate Schedule I to them to assist them in completing their tax return. CFC2 pays withholding tax of $4 on the distribution from CFC3. The country code for Country X is XX. See Regulations section 1.861-20(d)(3)(v)(C)(1). A corporation that uses an accrual method of accounting must use accrued payments and accrued receipts for purposes of computing the total amount to enter on each line of Schedule M. Schedule O is used to report the organization or reorganization of a foreign corporation and the acquisition or disposition of its stock. This summary filing procedure will satisfy the reporting requirements of sections 6038 and 6046. For these purposes, a CFCs gross tested income is its gross income less total exclusions (Schedule I1, line 4). No amount is reported on line 4, column (xii), because foreign income taxes attributable to high-tax exception or high-tax exclusion income are not creditable. The previously taxed accounts should be adjusted to reflect any reclassification of subpart F inclusions that reduced prior section 956 or 956A inclusions (see section 959(a)(2) and Schedule J). during the tax year" field, "3. A CFC that would not be a CFC if the determination were made without applying subparagraphs (A), (B), and (C) of section 318(a)(3) so as to consider a U.S. person as owning stock that is owned by a foreign person (for purposes of Category 5 filers). If prior period adjustments are not reported separately on the income statement, do not report such amounts on this line item (see ASC 250 (Accounting Changes and Error Corrections) or subsequent guidance). The information reported on Schedule E is relevant for U.S. shareholders making this election. Section 956(a)(1) amount. Enter on line 7 E&P as of the close of the tax year before actual distributions or inclusions under section 951(a)(1) or section 951A during the year. 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. Domestic Corporation is deemed to pay the $4 of withholding taxes deemed paid by CFC1 in Year 3 and paid by CFC2 in Year 2. Foreign taxes imposed on PTEP distributions reduce PTEP and are reported on Schedule J, line 6. Attach Form 5471 to your income tax return (or, if applicable, partnership or exempt organization return) and file both by the due date (including extensions) for that return. Using the list of activities and codes below, determine from which activity the company derives the largest percentage of its total receipts. If the company purchases raw materials and supplies them to a subcontractor to produce the finished product, but retains title to the product, the company is considered a manufacturer and must use one of the manufacturing codes (311110-339900). 170, available at IRS.gov/irb/2009-31_IRB#NOT-2009-55. The different rules are applicable for individuals, as well as corporations, estates, and trusts. Schedules E and E-1 are required for an. 12-2022) DRAFT AS OF Page 3 Enter amounts in functional currency of the foreign corporation (unless otherwise noted). Specified tangible property and dual-use property. This includes taxes attributable to the column (b) tested income group that were not deemed paid as a result of the domestic corporations inclusion percentage or as a result of the application of the 80% limit. An example of amounts reported on line 12 is taxes attributable to PTEP distributions to shareholders ineligible to claim a foreign tax credit under section 960(b)(1) (such as foreign corporations). Report foreign income taxes related to the current tax year that have been suspended due to the rules of section 909. The attached statement must include a totals line that ties into the amounts reported in each column of line 29. "field, "60.Enter the smaller of line 58 or line 59. See the instructions for column (xiv) and line 4. See Regulations section 1.960-1(d)(3)(ii)(C). Enter the sum of the amounts reported on lines 4(1), 4(2), etc., plus the sum of amounts excluded from subpart F income under the subpart F high-tax exception and tested income under the GILTI high-tax exclusion, in the appropriate column on line 4. See Regulations section 1.960-1(c)(1). Do not include foreign income taxes that are disallowed and are reported on Schedule E, Part III. Line 8. Any foreign corporation with respect to which one or more domestic corporations is a U.S. shareholder. Report a PTEP distribution by a lower-tier foreign corporation in Section 2 only if foreign income taxes are deemed paid under section 960(b) by the foreign corporation with respect to such PTEP distribution. See Regulations section 1.951A-1(d)(1). In other words, are any amounts described in section 954(c)(3)(A)(ii) excluded from line 1a of Worksheet A? Use lines 1f through 1i to enter the foreign base company sales income, foreign base company services income, full inclusion income, and insurance income described in section 952(a)(1) of the CFC. A foreign corporation may accrue or pay taxes properly attributable to an income group within the general category, passive category, or section 901(j) category. For example, if you are completing Schedule J for the passive category (that is, you have entered "PAS" on line a at the top of page 1 of Schedule J), enter the current year E&P (or deficit in E&P) amount from Schedule H (Form 5471), line 5c(ii), in the applicable column. This election will not be effective if the corporation was a disqualified corporation (as defined in section 953(c)(3)(E)) for the tax year for which the election was made or for any prior tax year beginning after 1986. 25 Important Tips for Getting the 5471 Form Correctly Filed See section 959(a)(2) and (f)(1). Such taxes are also reported on Schedule E, Part III, column (g). A CFC with tested income that is a partner of a partnership that has depreciable tangible property determines its share of the partnerships average adjusted basis in the depreciable tangible property of the partnership based on the amount of the distributive share of the gross income produced by the property that is included in the CFCs gross tested income (defined below) relative to the total amount of gross income produced by the property. A foreign corporation may accrue or pay taxes properly attributable to a PTEP group within any of the separate categories of income, with the exception of foreign branch category income. Use Worksheet A, later in these instructions, to compute the U.S. shareholder's pro rata share of subpart F income of the CFC, which is reportable on lines 1e through 1h. Domestic Corporation, a U.S. shareholder, wholly owns the only class of stock of CFC1, a foreign corporation. The time needed to complete and file this form will vary depending on individual circumstances. The corporate U.S. shareholder should include the line 5a amount on Form 1120, Schedule C, line 13, column (a), or the comparable line of other corporate income tax returns. The foreign corporation divides 30,255,400 Yen by 108.8593 to determine the U.S. dollar amount to enter in column (l) of Schedule E, Part I, Section 1, line 1. Enter the result here and on Form 5471, Schedule I, line 1f. If you invest in "master-feeder" structures, there could be Form 5471 or 8865 filing requirements you aren't aware of. A Schedule I-1 that includes passive category income on line 6 must include the code for passive category income (PAS) in the entry space for separate category (at the top of Schedule I-1). Such amounts are reported as negative numbers. Thus, the U.S. shareholders must: Compute the current subpart F income inclusion (potentially increasing that previously taxed account), Take into account current distributions (potentially reducing the previously taxed and untaxed accounts), and. Report on line 10, column (e), the taxes that relate to PTEP of the foreign corporation that are deemed paid by a shareholder of the foreign corporation, either an upper-tier foreign corporation or a U.S. shareholder, with respect to a distribution of PTEP made by the foreign corporation. For example, the Form 1040 page is at IRS.gov/Form1040; the Pub. If you are reporting with respect to more than one section 901(j) country, add to page 3 new lines 1m, 1n, 1o, etc. This statement must list the name of the FDE or FB, country under whose laws the FDE or FB was organized, and EIN (if any) of the FDE or FB. Check the Item E checkbox if any excepted specified foreign financial assets are reported on Form 5471. Also assume for both years that the local currency in which the tax was paid was the same as the foreign corporations functional currency. File this summary return in the manner described in When and Where To File, earlier. In doing so, the corporate U. S. shareholder must determine whether it meets the statutory and regulatory requirements for section 245A DRD. In the case of a CFC owned by a foreign disregarded entity (FDE), please include the information of the FDE and the regarded entity owner. Be sure to attach the approval letter to Form 5471. Therefore, the revised tax liability is $2. Columns (b) through (f) should request dollar amounts of the specified other amounts received during the annual accounting period by the foreign corporation from the persons listed in the headings for columns (b) through (f). If the shareholder is not a U.S. corporation, this amount is zero" field, "Section 956 inclusion. A domestic corporation is deemed to pay foreign income taxes attributable to inclusions under section 951(a)(1). If a U.S. shareholder of a CFC is considered to have participated in a reportable transaction under the rules of Regulations section 1.6011-4(c)(3)(i)(G), the shareholder is required to disclose information for each reportable transaction. See Regulation sections 989(b)(1) and (3), 1.951A-1(d)(1), and 1.965-1(b)(1) and (2). Illegal bribes, kickbacks, and other payments (line 21). In this example, we assume that CFC1 is wholly owned by a domestic corporation and all the foreign taxes mentioned here are not withholding taxes. Include as a positive amount in column (d) foreign income taxes related to the current tax year that have been suspended due to the rules of section 909. Enter amounts in U.S. dollars unless otherwise noted. The income is treated as interest on a loan to the obligor under section 864(d)(1) and is generally not eligible for the de minimis, export financing, and related party exceptions to the inclusion of subpart F income. Schedule R of Form 5471 is used to report basic information pertaining to distributions from foreign corporations by Sections 245A, 959, and 986 (c). There are some situations that warrant correlation of a new reference ID number with a previous reference ID number when assigning a new reference ID number to a foreign corporation. If a GILTI high-tax exclusion under Regulations section 1.951A-2(c)(7)(viii) is effective with respect to the CFC for the CFC inclusion year, check the box in column (xiv) that corresponds to the item(s) of income to which the exception applies. On line 9, report reductions for the portion of such taxes that are deemed paid by a U.S. shareholder with respect to an inclusion under section 951(a) or 951A. See Categories of Filers, earlier. For line 1(a)(1), gross income of $50 is reported in column (ii), foreign tax of $20 is reported in each of columns (x) and (xii), and the checkbox in column (xiv) is checked. Employee benefit plan determinations The other Schedule Q can come into play when a company or organization is setting up or making changes to a pension or retirement savings plan, such as a 401 (k), or some other employee benefit plan. PTEP attributable to section 1248 amounts from the gain on the sale of a foreign corporation stock by a CFC. An amount equal to the deficit reported in column (a), (b), or (c) of line 5a is included as a positive amount on line 5b of column (a), (b), or (c), respectively. Please refer to the instructions emailed to registrants for additional information. Complete a separate Schedule P for each applicable separate category of income. If one of the following exceptions applies, use the exchange rate in effect on the date the foreign corporation paid the tax.