Which Form 1120-F filers use Schedule M-3?
· 1 min read
A foreign corporation filing Form 1120-F must generally file Schedule M-3 when it has at least $10 million in assets reportable on Schedule L at the end of its tax year.
What to check
Below $10 million, eligible filers can elect to file Schedule M-3 voluntarily. A required filer with less than $50 million in year-end total assets, or a voluntary filer, can generally complete all of M-3 or complete Part I and use Schedule M-1 in place of Parts II and III. Check Schedule M-2 separately.
Example
If the corporation has $12 million of year-end reportable Schedule L assets, Schedule M-3 is required. It also checks the partial M-3 option against the IRS instructions.
Before you proceed
- Use end-of-year assets reportable on Schedule L.
- Confirm whether M-3 is required or voluntary.
- Reconcile the same book income across schedules if using M-1 with M-3 Part I.
Does Schedule M-3 replace Schedule M-2?
Check the separate Schedule M-2 requirement. The Form 1120-F instructions preserve it where applicable.
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