The IRS Form 5471 is a form that is designed for United States citizens that are shareholders in foreign companies. It is a form that is used to report the share ownership that you have in the corporation as well as some information concerning the activities of the foreign corporation. Before one even considers to file the Form 5471, it is important to know in which category you fall or whether you are required to file this form. The following categories are required to file Form 5471.
Category 2 Filer
Category 3 Filer
Any U.S. Shareholder of a CFC on any day of the tax year.
Category 4 Filer
Who is considered to have control in this Category Filer?
A United States individual is said to have control if at any particular time of the individuals tax year, he/she has:
- 50% ownership or more of the combined voting power in all the foreign corporations classes of stocks that enable one to be entitled to vote.
- 50% of the total share value of the entire foreign corporations classes of stock. This also applies to any US person that owns this amount of shares in a corporation that further owns 50% or more of the combined voting power or total share value of another corporation.
Category 5 Filer
- A domestic partnership
- A domestic corporation
- A resident or citizen of the US or
- A trust or estate that is not a foreign trust or estate as defined in section 7701(a)(31). A CFC is considered to be a foreign corporation with a U.S. shareholder that on any day of the tax year has a 50% ownership of the total stock value in the corporation or the total combined voting power of the corporations entire classes of the voting stocks.
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