Form 1120: U.S. Corporation Income Tax Return

Form 1120 is used by corporations to report income, deductions, gains, losses, credits, and other federal tax information.

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Introduction

Form 1120, U.S. Corporation Income Tax Return, is a federal tax form used by certain corporations to report their income, deductions, gains, losses, credits, and other applicable tax information. The form generally provides a summary of the corporation’s financial and tax activity for the applicable tax year.

This guide provides general information about Form 1120, including who may use the form, the information commonly needed, and the basic process for completing it. The information is intended to provide a simple overview of Form 1120 and its general purpose.

What Is Form 1120?

Form 1120 is generally used by domestic corporations to report their income and other applicable federal tax information. The return is generally used to calculate the corporation’s taxable income, applicable tax, payments, and balance due or overpayment.

Form 1120 commonly involves:

Corporation information
Business income
Business deductions
Assets and liabilities
Taxable income
Tax calculations
Tax payments
Tax credits
Schedule information
Supporting financial records

The information reported on Form 1120 should generally be based on the corporation’s accounting records, financial statements, bank records, payroll records, invoices, receipts, and other applicable business documentation.

Who Uses Form 1120?

Form 1120 is generally used by domestic corporations that are required to report their income and other applicable federal tax information. This may include corporations operating businesses or conducting other activities subject to federal corporate income tax reporting.

The filing requirements can depend on the corporation’s structure, activities, income, ownership, transactions, and other applicable circumstances. Some corporations may be required to use a different federal income tax return.

What Information Is Needed?

The information needed to complete Form 1120 generally comes from the corporation’s accounting records, financial statements, bank statements, payroll records, asset records, and other business documentation. Accurate records can help ensure that income, expenses, assets, liabilities, and tax information are properly reported.

Common information includes:

Corporation name
Corporation address
Employer identification number
Principal business activity
Accounting method
Business income
Business expenses
Asset information
Liability information
Taxable income information
Tax payments
Tax credits
Supporting financial records

The specific information required may depend on the corporation’s activities, accounting method, transactions, assets, income, expenses, and other circumstances.

How to Fill Out/Complete Form 1120

Form 1120 is generally completed by gathering the corporation’s financial and tax information, reporting applicable income and deductions, calculating taxable income and tax, completing applicable schedules, and reporting payments and credits.

The basic process is to gather the corporation’s accounting and tax records, enter the corporation information, report income and deductions, complete applicable schedules, calculate the applicable tax, report payments and credits, and review the completed return before submitting it. Corporations should retain supporting financial, accounting, and tax records.

Section 1

Enter the corporation’s identifying information. This generally includes the corporation’s name, address, employer identification number, principal business activity, accounting method, and other applicable information.

The information should be reviewed carefully to make sure it is accurate and consistent with the corporation’s legal, accounting, and tax records.

Section 2

Report the corporation’s income. This generally includes applicable business income and other income received or earned by the corporation during the tax year.

The amounts should generally be supported by the corporation’s accounting records, financial statements, bank records, sales records, and other applicable documentation.

Section 3

Report the corporation’s deductions and business expenses. This may include ordinary business expenses and other deductible amounts that apply to the corporation.

Corporations should review expense records, invoices, receipts, payroll records, and other supporting documentation to help ensure that deductible expenses are accurately reported.

Section 4

Complete applicable income, deduction, gain, loss, and other tax information. Certain items may require additional calculations or supporting schedules depending on the corporation’s activities.

Only information that applies to the corporation should generally be included. Supporting records should be retained for amounts reported on Form 1120 and related schedules.

Section 5

Complete the corporation’s applicable balance sheet and financial information. This generally involves reporting applicable assets, liabilities, and other financial information based on the corporation’s accounting records.

The reported amounts should generally be reviewed against the corporation’s books and financial statements to help identify differences or errors.

Section 6

Calculate the corporation’s taxable income. This generally involves applying applicable income and deduction amounts to determine the corporation’s taxable income for the tax year.

Corporations should review the calculation carefully and make sure the amounts used are supported by their accounting, financial, and tax records.

Section 7

Calculate the corporation’s applicable federal income tax. This generally involves using the corporation’s taxable income and other applicable information to determine the tax amount.

Corporations should review the tax calculation carefully and make sure that applicable adjustments, credits, and other required information have been considered.

Section 8

Enter applicable tax credits, payments, and other tax information. This may include estimated tax payments, credits, overpayments, or other applicable amounts.

Corporations should compare the amounts with payment records, credit documentation, and other supporting tax records before completing the return.

Section 9

Determine the corporation’s final tax balance, payment, or overpayment. The final calculation generally reflects taxable income, applicable tax, credits, payments, and other amounts reported on the return.

Corporations should compare the final amount with their supporting accounting and tax records before submitting the return.

Section 10

Complete any additional schedules or supplemental information required for the corporation. The applicable schedules depend on the corporation’s income, deductions, assets, liabilities, investments, ownership, transactions, and other activities.

Corporations should include only applicable schedules and information and should retain documentation supporting the amounts and information reported.

Section 11

Review the completed Form 1120 and related schedules to make sure all applicable information has been entered. Check the corporation information, income, deductions, assets, liabilities, taxable income, tax calculation, credits, payments, schedules, and final amount.

The completed return should generally be submitted according to the applicable filing requirements. The corporation should also keep a copy of Form 1120 and supporting financial, accounting, and tax records for its records.

Final Review

Review Form 1120 after completing all applicable sections. Check the corporation information, income, deductions, assets, liabilities, taxable income, tax calculation, credits, payments, schedules, supporting records, and final amount.

A final review can help identify calculation or reporting errors before the return is submitted. Corporations should retain Form 1120, financial statements, accounting records, payment records, and supporting tax records with their corporate records.

Common Mistakes

Common Form 1120 mistakes may include reporting incorrect income or expenses, entering incorrect corporation information, or failing to properly report applicable assets and liabilities. Errors involving taxable income, tax calculations, credits, or payments can also affect the return.

Other mistakes may include entering information in the wrong section, failing to include required schedules, using unsupported amounts, overlooking applicable reporting requirements, leaving required information incomplete, or submitting the return without reviewing it. Comparing Form 1120 with the corporation’s accounting, financial, payment, and tax records before filing can help identify potential errors.

Related IRS Forms

Corporations may encounter other federal tax forms when reporting business income, employment taxes, tax credits, assets, shareholders, and other corporate activities. Different forms are used for specific types of corporations and federal tax reporting.

Common related forms include:

Form 1040 for individual federal income tax reporting
Form 1065 for partnership income tax reporting
Form 1120-S for certain S corporation income tax reporting
Form 941 for certain employment tax reporting
Form 4562 for depreciation and certain business property
Form 3800 for the general business credit
Form 4797 for certain sales of business property

The appropriate form depends on the corporation’s specific circumstances and the type of business activity, income, expense, credit, property, or other tax information being reported.

Where to File or Submit

Form 1120 is generally submitted according to the federal filing requirements that apply to the corporation. The appropriate filing method can depend on the corporation’s circumstances, filing requirements, and other applicable rules.

Corporations should review the applicable filing requirements before submitting Form 1120. A copy of the completed return, payment records, financial statements, and supporting accounting and tax records should generally be retained for the corporation’s records.

Current IRS Form & Instructions

Corporations should use the applicable version of Form 1120 and its instructions when preparing the return. Forms and requirements can change, so the version used should correspond with the reporting period and circumstances being reported.

Before submitting Form 1120, review the form and instructions carefully and confirm that the information agrees with the corporation’s accounting, financial, payment, and tax records. This can help identify errors before the return is submitted.

Important Information / Disclaimer

This Form 1120 guide is provided for general informational purposes only and is intended to provide a basic overview of Form 1120 and common information associated with filing a corporate income tax return. This information is not tax, legal, accounting, or financial advice, and corporate filing requirements can vary depending on the corporation’s structure, activities, income, expenses, transactions, accounting records, and other applicable circumstances.

Corporations and their responsible parties are responsible for determining their applicable filing, payment, recordkeeping, and reporting requirements, and information on this page may not cover every situation, exception, or special rule that may apply. When appropriate, corporations should consider seeking assistance from a qualified tax professional or other qualified advisor regarding their specific tax situation, corporate reporting requirements, tax calculations, or Form 1120 filing requirements.