1120-FSC
U.S. Income Tax Return of a Foreign Sales Corporation
Form 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation, is the annual return of a foreign sales corporation (FSC). The IRS About page says corporations electing to be treated as a FSC or small FSC file this form to report their income, deductions, gains, losses, credits and income tax liability.
The FSC rules were repealed in 2000, with transition rules for existing FSCs. The instructions say no corporation may elect to be a FSC or a small FSC after September 30, 2000, so the form is used by FSCs whose election is still in effect. It runs six pages: page 1 with FSC information and tax and payments, then Schedules A, B, E, F, G, J, L, M-1 and M-2 and an Additional Information section.
You can fill out Form 1120-FSC free in your browser on this page and download it without an account.
Items A to F ask for the country or U.S. territory of incorporation, the type of election, EIN, date incorporated and total assets. Lines 1 to 3 cover the principal shareholder, any parent-subsidiary controlled group and the administrative pricing rules used.
Lines 1 to 6 show total tax from Schedule J, payments such as estimated tax, tax deposited with Form 7004 and the fuel tax credit from Form 4136, then tax due or overpayment and the direct deposit fields.
Schedule A figures cost of goods sold related to foreign trading gross receipts. Additional Information asks yes or no questions on business activity, shareholders, books and records, foreign management rules and foreign economic process rules.
Part I lists foreign trading gross receipts, the small FSC limitation, foreign trade income and exempt foreign trade income. Part II figures taxable income or loss after the net operating loss and dividends-received deductions.
Schedule E figures the exemption percentages. Schedule F reports net income from nonexempt foreign trade income and taxable nonforeign trade income. Schedule G lists deductions allocated or apportioned to foreign trade income.
Schedule J is the tax computation. Schedule L holds balance sheets per books, Schedule M-1 reconciles book income with income per return, and Schedule M-2 analyzes unappropriated retained earnings.
Enter the tax year, name, address, EIN, the foreign country or U.S. territory of incorporation and the election type. For item E, the instructions say to enter total assets from Schedule L, column (d), line 15, or -0- if there are none.
Describe the principal shareholder at the beginning of the tax year, answer the parent-subsidiary question, and check the pricing rule boxes on line 3a used to figure taxable income on foreign trading gross receipts.
Schedules A, B, F and G have column (a) for transactions using the administrative pricing rules and column (b) for those not using them, and Schedule E figures an exemption percentage for each. The instructions point to Schedule P (Form 1120-FSC) for those rules.
Complete Schedule J and carry its total tax to line 1 on page 1. Then complete the payment lines and enter tax due on line 4 or the overpayment on line 5.
Complete Schedules L, M-1 and M-2, then an authorized officer signs and dates the return. The instructions say not to enter See Attached or Available Upon Request instead of completing an entry space.
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The instructions say a corporation generally files by the 15th day of the 4th month after the end of its tax year. A FSC with a fiscal tax year ending June 30 files by the 15th day of the 3rd month after the end of its tax year.
The instructions say to file with the Internal Revenue Service Center, P.O. Box 409101, Ogden, UT 84409.
The instructions say a FSC files Form 7004 by the return due date to request an extension of time to file.
The instructions say the penalty may be 5% of the unpaid tax for each month or part of a month the return is late, up to 25%. For a return required to be filed in 2026 that is more than 60 days late, the minimum is the smaller of the tax due or $525.
Attach schedules and forms after page 6: Form 4136 first, then additional schedules in alphabetical order, additional forms in numerical order, and supporting statements last.
1120-FSC Sch. P
74 fields, 3 pages
8873
152 fields, 2 pages
7004
26 fields, 1 page
4136
485 fields, 4 pages
5472
143 fields, 3 pages
5713
383 fields, 4 pages
The FSC itself files this return, signed by a corporate officer. The instructions describe who files it, who does not, and who signs.
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No. The instructions say no corporation may elect to be a FSC or a small FSC after September 30, 2000.
No. The instructions say a FSC that elects to be treated as a domestic corporation under section 943(e)(1) files Form 1120 instead.
The instructions say foreign trading gross receipts of a small FSC that exceed $5 million are generally not considered in determining its exempt foreign trade income. Line 6b of Schedule B shows $5,000,000.
The instructions say a FSC with no foreign trade income for any 5 consecutive tax years beginning after December 31, 2001, is no longer treated as a FSC for any tax year beginning after that period.
No. The instructions say a FSC may not claim any benefits under any income tax treaty between the United States and any foreign country.
The instructions give the Internal Revenue Service Center, P.O. Box 409101, Ogden, UT 84409.