Instructions for Form 8858

Instructions for Form 8858

(Rev. December 2024)

(Use with the December 2024 revision of Form 8858 and the September 2021

revision of separate Schedule M)

Information Return of U.S. Persons With Respect to Foreign Disregarded Entities

(FDEs) and Foreign Branches (FBs)

Section references are to the Internal Revenue Code unless

otherwise noted.

Future Developments

For the latest information about developments related to

Form 8858, Schedule M (Form 8858), and their instructions,

such as legislation enacted after they were published, go to

IRS.gov/Form8858.

What's New

Who must file, category 1 filer. The scope of filers was

clarified to only apply to a direct owner of an FDE and

operator of an FB.

Who must file, category 2 filer. The scope of filers was

clarified to only apply to a tax owner of an FDE and operator

of an FB that is owned through one or more tiers of FDEs.

Who must file, category 6 filer. The scope of filers was

revised to apply to a U.S. corporation (other than a regulated

investment company (RIC), a real estate investment trust

(REIT), or an S corporation) that is a partner in a partnership,

which checked box 11 (Dual Consolidated Loss) on

Schedules K-2 and K-3 (Form 1065), regardless of whether

the partnership is a U.S. or foreign partnership.

Line 1h, Principal business activity code number. The

entry for the 6-digit principal business activity code number

was separated from Line 1i, Principal business activity, where

the description of the FDE's or FB's principal business

activity is entered.

Schedule G, line 14. Certain jurisdictions have enacted

legislation to implement the GloBE Model Rules for the

Qualified Domestic Minimum Top-up Tax (QDMTT), Income

Inclusion Rule (IIR), and UTPR. Under these rules, if the

Effective Tax Rate (ETR) for a jurisdiction is below the 15%

Minimum Rate, Top-up Tax may be imposed and collected

under the QDMTT, IIR, and/or UTPR.

Reminders

Who must file, category 5 filer, and Schedule G, lines 10

through 13. The persons previously described in category 5

are no longer required to file, and a U.S. partnership is no

longer required to answer questions on lines 10 and 11 of

Schedule G as if it were a U.S. corporation. For a

partnership's reporting obligations concerning dual

consolidated losses, see Partnership Instructions for

Schedules K-2 and K-3 (Form 1065). The description in

category 5 has been modified for a new group of filers.

Initial or final checkboxes. Additional clarification has

been provided for when to check these boxes. See Initial

Form or Final Form 8858 under Specific Instructions, later.

Aug 29, 2024

Functional currency. Filers of Form 8858 are required to

enter a three-letter ISO 4217 “Alphabet Code” on lines 1j, 3e,

and 4d. For more information, see the instructions for line 1j,

later.

General Instructions

Purpose of Form

Form 8858 is used by certain U.S. persons that operate an

FB or own an FDE directly or, in certain circumstances,

indirectly or constructively. See U.S. Person Filing Form

8858, later. The form and schedules are used to satisfy the

reporting requirements of sections 6011, 6012, 6031, and

6038, and related regulations.

If the tax owner of the FDE or FB is a controlled foreign

corporation (CFC) or controlled foreign partnership (CFP),

the amounts reported on Form 8858 Schedules C, F, H, J,

and M must be included in determining the amounts reported

on the equivalent schedules, if applicable, of Form 5471 or

Form 8865 of the tax owner. If there are tiers of FDEs or FBs

(for example, one FDE owns one or more FDEs or FBs), then

complete separate Forms 8858 for each FDE or FB. Do not

include amounts reported on a Form 8858 for a lower tier

FDE or FB onto the Form 8858 for the upper tier FDE.

However, the amounts for all the FDEs and FBs must be

included in determining the amounts reported on the form for

the tax owner.

Who Must File

The following U.S. persons that are tax owners of FDEs,

operate an FB, or that own certain interests in tax owners of

FDEs or FBs must file Form 8858, and Schedule M (Form

8858).

Category 1 filer. A U.S. person that is directly a tax owner of

an FDE or operates an FB at any time during the U.S.

person's tax year or annual accounting period. Complete the

entire Form 8858, including the separate Schedule M (Form

8858), Transactions Between Foreign Disregarded Entity

(FDE) or Foreign Branch (FB) and the Filer or Other Related

Entities.

Category 2 filer. A U.S. person that indirectly through one

or more tiers of FDEs is either a tax owner of an FDE or

operates an FB at any time during the U.S. person’s tax year

or annual accounting period. Complete the entire Form 8858,

including the separate Schedule M (Form 8858).

Category 3 filer. Certain U.S. persons that are required to

file Form 5471 with respect to a CFC that is a tax owner of an

FDE or operates an FB at any time during the CFC's annual

accounting period.

Category 4 filers of Form 5471. Complete the entire

Form 8858 and the separate Schedule M (Form 8858).

Instructions for Form 8858 (Rev. 12-2024) Catalog Number 38123Q

Department of the Treasury Internal Revenue Service www.irs.gov

Category 5 filers of Form 5471. Complete only the

identifying information on page 1 of Form 8858 (for example,

everything before Schedule C) and Schedules G, H, and J.

Do not complete the separate Schedule M (Form 8858).

Category 4 filer. Certain U.S. persons that are required to

file Form 8865 with respect to a CFP that is a tax owner of an

FDE or operates an FB at any time during the CFP's annual

accounting period. If the U.S. person required to file by

operation of this rule is a U.S. individual, the U.S. person is

not required to complete lines 10 through 13 of Schedule G.

If the U.S. person is not an individual, the U.S. person is

required to report its distributive share of the items on lines

10 through 13 of Schedule G.

Category 1 filers of Form 8865. Complete the entire

Form 8858 and the separate Schedule M (Form 8858).

Category 2 filers of Form 8865. Complete only the

identifying information on page 1 of Form 8858 (for example,

everything above Schedule C) and Schedules G, H, J, and

the separate Schedule M (Form 8858). You are not required

to complete Form 8858 if there is a category 1 filer of Form

8865 that completes the entire Form 8858 and separate

Schedule M (Form 8858) with respect to the FDE or FB.

Category 5 filer. A U.S. person that is a partner in a

partnership that owns an FDE or operates an FB and applies

section 987 to the activities of the FDE or FB using a method

that requires the partner, rather than the partnership, to

recognize section 987 gain or loss with respect to the FDE or

FB. The U.S. person must complete the first page of the Form

8858 and Schedule C-1 for each FDE and FB of the

partnership. As stipulated in the Partnership Instructions for

Schedules K-2 and K-3 (Form 1065), the partnership must

furnish to the U.S. person all the information necessary for

them to complete the above-described portions of Form

8858. A category 5 filer should check the box for “FDE of a

U.S. person” (in the case of an FDE owned by a partnership)

or “FB of a U.S. person” (in the case of an FB owned by a

partnership).

Category 6 filer. A U.S. corporation (other than a RIC, a

REIT, or an S corporation) that is a partner in a partnership,

which checked box 11 (Dual Consolidated Loss) on

Schedules K-2 and K-3 (Form 1065). Even though the U.S.

corporation is not the tax owner of the FDE and/or the FB, the

U.S. corporation must complete lines 1 through 5 of the Form

8858, line 3 of Schedule G, and report its distributive share of

the items on lines 10 through 13 of Schedule G for each FDE

and FB of the partnership. As stipulated in the Partnership

Instructions for Schedules K-2 and K-3 (Form 1065), the

partnership must furnish to the U.S. corporate partner the

information necessary for the partner to complete the

above-described portions of Form 8858.

Note. Complete a separate Form 8858 and all applicable

schedules for each FDE or FB.

Exceptions To Filing Form 8858

Multiple filers of the same information. In the case of

category 4 or 5 filers of Form 5471 or category 1 filers of

Form 8865 who are also required to file Form 8858, one

person may file Form 8858 and Schedule M (Form 8858), if

applicable, for other persons who have the same filing

requirements with respect to both Form 8858 and Form 5471

or Form 8865. If you and one or more other persons are

required to furnish information for the same FDE or indirect

FB for the same period, this information may be included with

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or attached to, and filed in the same manner as, the multiple

filer information provided with respect to the CFC or the CFP.

See Multiple filers of same information in the Instructions for

Form 5471 or Multiple Category 1 filers in the Instructions for

Form 8865.

When and Where To File

Form 8858 is due when your income tax return or information

return is due, including extensions. If you are the tax owner of

the FDE or operate an FB, attach Form 8858 and the

separate Schedule M (Form 8858), if required, to your

income tax return or information return. If you are not the tax

owner of the FDE or indirect FB, attach Form 8858 to any

Form 5471 or Form 8865 you are filing with respect to the

CFC or the CFP that is the tax owner of the FDE or operates

the FB.

Definitions

U.S. Person

A U.S. person is:

• A citizen or resident alien of the United States (see Pub.

519 for guidance on determining resident alien status);

• A domestic partnership;

• A domestic corporation;

• Any estate (other than a foreign estate, within the meaning

of section 7701(a)(31)(A)); and

• Any domestic trust.

A domestic trust is any trust if:

1. A court within the United States is able to exercise

primary supervision over the administration of the trust, and

2. One or more U.S. persons have the authority to control

all substantial decisions of the trust.

U.S. Person Filing Form 8858

The U.S. person filing Form 8858 is any U.S. person that:

• Is the tax owner of an FDE;

• Owns a specified interest in an FDE indirectly or

constructively through a CFC or a CFP (see items 2 and 3

under Who Must File, earlier, for more detailed information);

or

• Operates (directly or indirectly through a tier of FDEs) an

FB.

Throughout these instructions, when the pronouns “you”

and “your” are used, they are used in reference to the U.S.

person filing Form 8858.

Foreign Disregarded Entity (FDE)

An FDE is an entity that is not created or organized in the

United States and that is disregarded as an entity separate

from its owner for U.S. income tax purposes under

Regulations sections 301.7701-2 and 301.7701-3. See the

instructions for Form 8832 for more information.

An eligible entity uses Form 8832 to elect how it will be

classified for federal tax purposes. A copy of Form 8832 is

attached to the entity's federal tax return for the tax year of

the election; however, special rules apply if the entity is not

required to file a tax return. For more information, see Where

To File in the instructions for Form 8832.

Note. Rules, effective September 28, 2009, allow an eligible

entity to request a late entity classification election. See Rev.

Instructions for Form 8858 (Rev. 12-2024)

Proc. 2009-41, available at IRS.gov/irb/

2009-39_IRB#RP-2009-41, for more information.

Tax Owner of FDE

The tax owner of the FDE is the person that is treated as

owning the assets and liabilities of the FDE for purposes of

U.S. income tax law.

Direct Owner of FDE

The direct owner of an FDE is the legal owner of the

disregarded entity.

Example. Assume Avery, a U.S. individual, is a 60%

partner of CFP 1, a controlled foreign partnership. FDE 1 is a

foreign disregarded entity owned by CFP 1, and FDE 2 is a

foreign disregarded entity owned by FDE 1. In this example,

FDE 1 is the direct owner of FDE 2, and CFP 1 is the direct

owner of FDE 1. CFP 1 is the tax owner with respect to both

FDE 1 and FDE 2. Avery would be required to file the Forms

8858 relating to FDE 1 and FDE 2 with the Form 8865 it files

with respect to CFP 1.

Foreign Branch (FB)

An FB is defined in Regulations section 1.367(a)-6T(g). For

purposes of filing a Form 8858, an FB also includes a

qualified business unit (QBU) (as defined in Regulations

section 1.989(a)-1(b)(2)(ii)) that is foreign.

Example. Assume A, a domestic corporation, operates a

foreign branch, FB1, in country X and is the tax owner of a

foreign disregarded entity, FDE1, in country Y that also

operates a foreign branch, FB2, in country Z. In addition, A is

the sole owner of CFC1, a controlled foreign corporation, that

operates a foreign branch, FB3, in country Z. FB1, FB2, and

FB3 qualify as foreign branches under Regulations section

1.367(a)-6T(g).

A is the direct owner of the activities of FB1 and FDE1,

and an indirect owner of the activities of FB2, through its

ownership of FDE1.

A would be required to file separate Forms 8858 relating to

FB1, FDE1, and FB2, its indirect foreign branch through its

ownership of FDE1. Unless indicated otherwise on the Form

8858 or in the instructions, the Form 8858 filed relating to

FDE1 would include only items attributable to FDE1 and

therefore would not include any items attributable to FB2.

Similarly, unless indicated otherwise, the Form 8858 filed for

FB2 would include only items attributable to FB2 and not to

FDE1.

CFC1 is the direct owner of the activities of FB3. Also,

CFC1 is the tax owner with respect to the foreign branch

activities of FB3. A would be required to file the Form 8858

relating to FB3 with the Form 5471 it files with respect to

CFC1. The Form 5471 for CFC1 would include any income or

loss incurred by FB3.

Accounting books and records. The existence of a

separate set of books and records, or lack thereof, may affect

the determination of whether a trade or business activity

qualifies as an FB that is required to file Form 8858. For more

information, see Regulations sections 1.989(a)-1(d) and

1.367(a)-6T(g)(1).

Penalties

Failure to file information required by section 6038(a)

(Form 8858 and Schedule M (Form 8858)).

• A $10,000 penalty is imposed for each annual accounting

period of each CFC or CFP for failure to furnish the required

Instructions for Form 8858 (Rev. 12-2024)

information within the time prescribed. If the information is not

filed within 90 days after the IRS has mailed a notice of the

failure to the U.S. person, an additional $10,000 penalty (per

CFC or CFP) is charged for each 30-day period, or fraction

thereof, during which the failure continues after the 90-day

period has expired. The additional penalty is limited to a

maximum of $50,000 for each failure.

• Any person who fails to file or report all of the information

required within the time prescribed will be subject to a

reduction of 10% of the foreign taxes available for credit

under sections 901 and 960. If the failure continues 90 days

or more after the date the IRS mails notice of the failure to the

U.S. person, an additional 5% reduction is made for each

3-month period, or fraction thereof, during which the failure

continues after the 90-day period has expired. See section

6038(c)(2) for limits on the amount of this penalty.

Criminal penalties. Criminal penalties under sections 7203,

7206, and 7207 may apply for failure to file the information

required by section 6038.

Note. Any person required to file Form 8858 and

Schedule M (Form 8858) who agrees to have another person

file the form and schedules for them may be subject to the

above penalties if the other person does not file a correct and

proper form and schedule.

Other Reporting Requirements

Reporting Exchange Rates on Form 8858

When translating amounts from functional currency to U.S.

dollars, you must use the method specified in these

instructions. But, regardless of the specific method required,

all exchange rates must be reported using a “divide-by

convention” rounded to at least four places. That is, the

exchange rate must be reported in terms of the amount by

which the functional currency amount must be divided in

order to reflect an equivalent amount of U.S. dollars. As such,

the exchange rate must be reported as the units of foreign

currency that equal 1 U.S. dollar, rounded to at least four

places. Do not report the exchange rate as the number of

U.S. dollars that equal 1 unit of foreign currency.

Note. You must round the result to more than four places;

failure to do so would materially distort the exchange rate or

the equivalent amount of U.S. dollars.

Example. During its annual accounting period, an FDE

owned by a U.S. person had current income of 30,255,400

Japanese Yen on Schedule H, line 6. The Schedule H, line 7,

instructions specify that the filer must translate these

amounts into U.S. dollars at the average exchange rate for

the tax year in accordance with the rules of section 989(b).

The average exchange rate is 105.7846 Japanese Yen to

1 U.S. dollar (0.00945317 U.S. dollars to 1 Japanese Yen).

Divide 30,255,400 Japanese Yen by 105.7846 to determine

the U.S. dollar amount to enter on Schedule H, line 7. Enter

105.7846 on Schedule H, line 8.

Electronic Filing of Form 8858

If you file your income tax return electronically, see the

instructions for your income tax return for general information

about electronic filing.

Note. If you are filing Form 1120 or 1065 electronically, you

must attach Form 8858 electronically (as an attachment to

your electronically filed Form 1120, Form 1065, Form 5471,

3

or Form 8865). If you are filing Form 1040, Form 1040-SR, or

Form 1041 electronically (with or without a Form 5471 or

Form 8865), attach Form 8858 to the applicable Form 8453.

Computer-Generated Form 8858 and Schedules

A computer-generated Form 8858 and its schedules may be

filed if they conform to and do not deviate from the official

form and schedules. Generally, all computer-generated forms

must receive prior approval from the IRS and are subject to

an annual review.

Submit all requests for approval to the Substitute Forms

Program. Use the address in the current Pub. 1167, General

Rules and Specifications for Substitute Forms and Schedules

at IRS.gov/Pub1167.

Important: Be sure to attach the approval letter to Form

8858.

Every year, the IRS issues a revenue procedure to provide

guidance for filers of computer-generated forms. In addition,

every year, the IRS issues Pub. 1167, which reprints the most

recent applicable revenue procedure. Pub. 1167 is available

at IRS.gov/Pub1167, or can be ordered by calling

800-TAX-FORM (800-829-3676).

Dormant FDEs

Announcement 2004-4, 2004-4 I.R.B. 357, available at

IRS.gov/irb/2004-04_IRB#2004-4, provides for a summary

filing procedure for filing Form 8858 for a dormant FDE. A

dormant FDE would be a dormant controlled foreign

corporation if it were treated as a foreign corporation for U.S.

tax purposes.

If you elect the summary procedure, complete only the

identifying information before Schedule C on page 1 of Form

8858 for each dormant FDE as follows.

• The top margin of the summary return must be labeled

“Filed Pursuant to Announcement 2004-4 for Dormant FDE.”

• Include the name, address, identifying number, and tax

year of the U.S. person filing Form 8858 (see U.S. Person,

earlier).

• Include the annual accounting period of the dormant FDE

(below the title of the form) and complete lines 1a through 1e,

and 1g.

• Complete lines 3a through 3d, if applicable.

• Complete lines 4a through 4c, if applicable.

File this summary return in the manner described in When

and Where To File, earlier.

Specific Instructions

Important: If the information required in a given section

exceeds the space provided within that section, do not write

“see attached” in the section and then attach all of the

information on additional sheets. Instead, complete all entry

spaces in the section and attach the remaining information

on additional sheets. The additional sheets must conform

with the IRS version of that section.

Identifying Information

Annual Accounting Period

Enter, in the space provided below the title of Form 8858, the

annual accounting period of the FDE or FB for which you are

furnishing information. The annual accounting period of an

FDE or FB is the annual accounting period or tax year of the

4

tax owner. Therefore, in the case of a U.S. tax owner, the

annual accounting period of the FDE or FB is the tax year of

the U.S. tax owner; and in the case of a CFC or CFP that is a

tax owner, the annual accounting period of the FDE or FB is

the annual accounting period of the CFC or CFP.

Person Filing This Return

In the spaces provided at the top of page 1 of Form 8858,

provide the identifying information for the U.S. person filing

Form 8858 (see U.S. Person, earlier).

If a U.S. corporation is the U.S. person filing Form 8858

and is a member of a consolidated group, list the common

parent as the person filing the return and enter its identifying

information in the spaces provided at the top of page 1 of the

form.

Name Change

If the name of the person filing the return, the tax owner, the

direct owner, the FB, or the FDE whose activities are being

reported changed within the past 3 years, show the prior

name(s) in parentheses after the current name.

Addresses

Use the following instructions to complete lines 1a, 2a, 2b,

3a, and 4a, and the entry spaces at the top of page 1 of the

form for the filer's address.

U.S. addresses. Include the suite, room, or other unit

number after the street address. If the post office does not

deliver mail to the street address and the U.S. person has a

P.O. box, show the box number instead.

Foreign addresses. Enter the information in the following

order: city, province or state, and country. Follow the

country's practice for entering the postal code, if any. Do not

abbreviate the country name. However, if you are filing Form

8858 electronically, enter a valid country code (from the list at

IRS.gov/CountryCodes) instead of the country name.

Initial Form or Final Form 8858

Check the Initial Form 8858 box in the year the tax owner

formed or aquired the FDE or FB, and check the Final Form

8858 box in the year the tax owner terminated or disposed of

the FDE or FB. Only one of these boxes can be checked on

each Form 8858 filed. For example, if an FDE is formed or

aquired, and terminated or disposed of, within the same tax

year (even if it was on the same day), you are required to file

a separate Form 8858 for each event.

On one Form 8858, you would check the Initial 8858

checkbox to reflect the formation or acquisition of the FDE,

and complete the rest of the form reporting information for the

period that the tax owner owns the FDE. On the other Form

8858, you would check the Final 8858 checkbox to reflect the

termination or disposition of the FDE, and complete the rest

of the form reporting information for the period that the tax

owner owns the FDE.

Identifying Numbers

Use the following instructions to complete lines 1b(1), 3c(1),

and 4c, and the entry space at the top of page 1 of the form

for the filer's identifying number. The identifying number of an

individual is their social security number (SSN). The

identifying number of all others is their employer identification

number (EIN).

Instructions for Form 8858 (Rev. 12-2024)

If a U.S. corporation is the U.S. person filing Form 8858

and is a member of a consolidated group, see Person Filing

This Return, earlier.

Line 1b(1)—U.S. identifying number. Generally, you must

enter an EIN on line 1b(1). If you don’t have an EIN when you

file Form 8858, you must enter a reference ID number on

line 1b(2).

Foreign disregarded entity (FDE). An EIN is required for

an FDE to file Form 8832 to elect to be treated as an FDE.

The new EIN must be included on the Form 8858 filed by the

FDE for the first year in which it elects to be treated as an

FDE, and the old reference ID number must be entered on

line 1b(2). In subsequent years, the FDE must enter the EIN

on line 1b(1) of the Form 8858, but entering the old reference

ID number on line 1b(2) is optional.

Foreign branch (FB). An FB does not file Form 8832 and

thus may not be required to have an EIN. In that case, the FB

must enter a reference ID number on line 1b(2).

Note. Do not enter an SSN on line 1b(1) or 1b(2).

Line 1b(2)—Reference ID number. A reference ID number

(defined below) is required on line 1b(2) only in cases where

no EIN was entered on line 1b(1) for the FDE or FB. However,

filers are permitted to enter both an EIN on line 1b(1) and a

reference ID number on line 1b(2). If applicable, enter the

reference ID number you have assigned to the FDE or FB

identified on line 1a.

A "reference ID number" is a number established by the

U.S. person identified at the top of page 1 of the Form 8858

who is responsible for completing the Form 8858 for the FDE

or FB. The reference ID number must meet the requirements

set forth below.

Note. Because reference ID numbers are established by or

on behalf of the U.S. person filing Form 8858, there is no

need to apply to the IRS to request a reference ID number or

for permission to use these numbers. Reference ID numbers

must be used consistently from year to year to identify a

specific FB or FDE.

Requirements. The reference ID number that is entered

on line 1b(2) must be alphanumeric (defined below) and no

special characters or spaces are permitted. The length of a

given reference ID number is limited to 50 characters.

For these purposes, the term "alphanumeric" means the

entry can be alphabetical, numeric, or any combination of the

two.

The same reference ID number must be used consistently

from tax year to tax year with respect to a given FDE, FB, or

tax owner. If for any reason a reference ID number falls out of

use (for example, the FDE, FB, or tax owner no longer exists

due to disposition or liquidation), the reference ID number

used for that FDE, FB, or tax owner cannot be used again for

another FDE, FB, or tax owner for purposes of Form 8858

reporting.

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 an

FDE, FB, or tax owner partnership. For example:

• In the case of a merger or acquisition, a Form 8858 filer

must use a reference ID number that correlates the previous

reference ID number with the new reference ID number

assigned to the FDE, FB, or tax owner; or

• Under Regulations section 301.6109-1(b)(2)(v), a foreign

entity that makes an entity classification election on Form

Instructions for Form 8858 (Rev. 12-2024)

8832 to become an FDE must have an EIN. For the first year

that Form 8858 is required to be filed after an entity

classification election is made on behalf of the foreign entity

on Form 8832, the new EIN must be entered on line 1b(1) of

Form 8858 and the old reference ID number must be entered

on line 1b(2) of Form 8858. In subsequent years, a filer may

continue to enter both the EIN on line 1b(1) and the reference

ID number on line 1b(2), but must enter at least the EIN on

line 1b(1).

You must correlate the reference ID numbers as follows:

New reference ID number (space) Old reference ID number.

If there is more than one old reference ID number, you must

enter a space between each such number. As indicated

above, the length of a given reference ID number is limited to

50 characters and each number must be alphanumeric and

no special characters are permitted.

Note. This correlation requirement applies only to the first

year the new reference ID number is used.

Line 1g—Country in Which Principal Business

Activity Is Conducted

Enter the two-letter country code (from the list at IRS.gov/

CountryCodes) of the country in which the principal business

activity of the FDE or FB is conducted.

Enter “US” if the principal business activity of an FDE is

conducted in the United States.

Line 1h—Principal Business Activity Code

Number

Enter the 6-digit principal business activity code number for

the FDE or FB. Principal business activity code numbers can

be found at the end of the Instructions for Form 5471.

Line 1i—Principal Business Activity

Enter a brief description of the FDE’s or FB’s principal

business activity.

Line 1j—Functional Currency

Enter the entity's three-letter functional currency code. This is

an Alphabet Code selected from ISO 4217, available at

ISO.org/iso-4217-currency-codes.html or CURRENCYISO.org/en/home/tables/table-a1.html. See sections 985 and

989, and Regulations sections 1.985-1(a) through (c) and

1.989(a)-1(b) for rules for determining the functional currency

of a QBU and the definition of a QBU.

Hyperinflationary exception. An entity that would

otherwise be required to use a hyperinflationary currency as

its functional currency must use the U.S. dollar as its

functional currency and figure income or loss or earnings and

profits using the U.S. dollar approximate separate

transactions method of accounting (DASTM) under the

special rules of Regulations section 1.985-3. However, if the

hyperinflationary QBU is an FDE or FB of a foreign

corporation with a non-U.S. dollar functional currency that is

not hyperinflationary, the functional currency of the FDE or

FB is the functional currency of the foreign corporation and

such QBU applies Regulations section 1.985-3 by

substituting the functional currency of the foreign corporation

for the U.S. dollar. See Regulations section 1.985-1(b)(2).

5

Line 3

If the tax owner of the FDE or FB is different from the filer,

then provide the information required on lines 3a through 3e

for the tax owner.

Line 3b

If the tax owner is a CFC, enter the annual accounting period

covered by Form 5471 (as described in Regulations section

1.6038-2(e)). If the tax owner is a CFP, enter the annual

accounting period covered by Form 8865 (as described in

Regulations section 1.6038-3(f)).

Line 3c(1)—U.S. Identifying Number

To complete line 3c(1), see Line 1b(1)—U.S. identifying

number, earlier. If the tax owner does not have an EIN when

Form 8858 is filed, a reference ID number must be entered

on line 3c(2). See the instructions for line 3c(2), later.

Note. If the tax owner is an individual, enter an SSN on

line 3c(1) or line 3c(2).

Line 3c(2)—Reference ID Number

A reference ID number (defined earlier, under the instructions

for line 1b(2)) is required on line 3c(2) only in cases where no

EIN was entered on line 3c(1). However, filers are permitted

to enter both an EIN on line 3c(1) and a reference ID number

on line 3c(2). If this tax owner is a CFC, enter the reference ID

number for the CFC from Form 5471, item 1b(2). If this tax

owner is a CFP, enter the reference ID number for the CFP

from Form 8865, item G2(b). See the instructions for

line 1b(2) for more information about the requirements for the

reference ID number.

Note. If this tax owner is a CFC and Schedule A (Form 8992)

or Schedule B (Form 8992) is required to be filed with respect

to that CFC, the reference ID number entered on line 3c(2)

must be the same as the reference ID number entered on

Form 5471, item 1b(2), and Schedule A (Form 8992), column

(b), or Schedule B (Form 8992), Part I, column (b).

Line 3e

See Line 1j—Functional Currency, earlier.

Line 4

If the direct owner of the FDE or FB is different from the tax

owner, then provide the information required on lines 4a

through 4d for the direct owner. If the FDE has more than one

direct owner, attach a statement to Form 8858 that includes

the information requested on line 4 for each additional direct

owner.

Line 4c—U.S. Identifying Number

To complete line 4c, see Line 1b(1)—U.S. identifying number,

earlier. If the direct owner does not have an EIN when Form

8858 is filed, leave this line blank.

Note. If the direct owner is an individual, enter an SSN on

line 4c.

Line 4d

See Line 1j—Functional Currency, earlier.

Line 5

between the tax owner and the FDE or FB and the chain of

ownership between the FDE or FB and all entities in which

the FDE or FB has a 10%-or-more direct or indirect interest.

• The name and percentage of ownership of all entities in

the chain of ownership, including partnerships and entities

disregarded as separate from their owners.

• The FDE’s or FB’s position in the chain of ownership.

• The tax classification of all entities in the chain of

ownership (see the Form 8832 instructions for tax

classification rules and related definitions).

• The country under whose law each entity is organized.

For these purposes, the rules of section 958(a) (relating to

“direct and indirect ownership”) apply.

Each filer of Form 8858 that is required to file an

organizational chart with respect to more than one FDE

and/or FB may satisfy this requirement by filing a single

organizational chart that includes the required information

with respect to all FDEs and FBs.

Schedule C—Income Statement

Use Schedule C to report a summary income statement for

the FDE or FB figured in the FDE’s or FB’s functional

currency in accordance with U.S. generally accepted

accounting principles (GAAP). Enter in the U.S. dollar column

each line item functional currency amount translated into

dollars using U.S. GAAP translation rules. If the FDE or FB

does not maintain U.S. GAAP income statements in U.S.

dollars, you can use the average exchange rate as

determined under section 989(b). The rate used should be

the rate stated on Schedule H, line 8. If you choose to use the

average exchange rate rather than the U.S. GAAP translation

rules, check the box above line 1 on Schedule C.

Special rules for DASTM. If the FDE or FB uses DASTM,

the functional currency column should reflect local

hyperinflationary currency amounts figured in accordance

with U.S. GAAP. The U.S. dollar column should reflect such

amounts translated into dollars under U.S. GAAP translation

rules. Differences between this U.S. dollar GAAP column and

the U.S. dollar income or loss figured for tax purposes under

Regulations section 1.985-3(c) should be accounted for on

Schedule H. See Special rules for DASTM under

Schedule H, later.

Line 12

Enter the income, war profits, and excess profits tax

deducted in accordance with U.S. GAAP.

Line 13

Include on line 13 adjustments for extraordinary items or prior

period adjustments. The terms “extraordinary items” and

“prior period adjustments” have the same meaning given to

them by U.S. GAAP (see Subtopic 225-20, Income

Statement and Statement No. 16 of the Financial Accounting

Standards Board).

Important: Differences between this functional currency

amount and the amount of taxes that reduce earnings and

profits (E&P) (in the case of an FDE or FB of a CFC) or are

deductible in figuring U.S. taxable income (in the case of an

FDE or FB of a U.S. person or a CFP) should be accounted

for on line 2 or 3 of Schedule H.

You must attach an organizational chart that includes the

following information with respect to the chain of ownership

6

Instructions for Form 8858 (Rev. 12-2024)

Schedule C-1—Section 987 Gain or

Loss Information

The activities of an FDE or FB may give rise to one or more

QBUs. If the QBU has a different functional currency than its

owner, then such owner may be subject to section 987.

If an owner would be treated as owning multiple QBUs,

complete a separate Schedule C-1 with respect to each QBU

of the owner.

If a QBU has multiple owners, complete a separate

Schedule C-1 for each owner.

However, if the U.S. person filing Form 8858 knows that

the owner of a QBU has the same functional currency as a

QBU owned by that person, the U.S. person filing Form 8858

is not required to complete Schedule C-1 with respect to that

owner’s interest in the QBU.

If the U.S. person filing Form 8858 does not know and

does not have reason to know the functional currency of the

owner of a QBU, leave column (b) of lines 1 and 2 blank.

Line 2b

Report on line 2b the amount of section 987 gain or loss

recognized by the recipient owner that results from a

remittance from a QBU or a termination of a QBU.

For amounts reported on line 2b, include a statement with

the following information.

• A description of the methodology used to figure the section

987 gain or loss.

• The amount of section 987 gain or loss included on line 2b

that was previously deferred under Regulations section

1.987-12 and that is being recognized in the current tax year.

Line 3b

Report on line 3b the amount of section 987 gain or loss that

is deferred under Regulations section 1.987-12 either from a

deferral event or an outbound loss event.

If an amount is included on line 3b, include a statement

that provides the following information for each deferral event

or outbound loss event.

• Description of the deferral event or outbound loss event.

• The amount of section 987 gain or loss recognized in the

tax year of the deferral event or outbound loss event, and in

any subsequent tax year, the remaining amount of deferred

section 987 gain or loss.

• For an outbound loss event described in Regulations

section 1.987-12(d)(4), the amount of section 987 loss that is

an adjustment to stock basis and the name of the CFC that

had an adjustment to its basis from the outbound loss event.

Line 5

If the owner changed the method of accounting for its section

987 gain or loss, provide a statement describing the previous

method used, the new method being used, and the rationale

for the change in method of accounting.

Schedule F—Balance Sheet

Use Schedule F to report a summary balance sheet for the

FDE or FB figured and translated into U.S. dollars in

accordance with U.S. GAAP.

Special rule for DASTM. If the FDE or FB uses DASTM,

Schedule F should be prepared and translated into U.S.

dollars according to Regulations section 1.985-3(d), rather

than U.S. GAAP.

Instructions for Form 8858 (Rev. 12-2024)

Schedule G—Other Information

Line 3

If the tax owner of the FDE is claiming a section 165 loss with

respect to worthless stock or with respect to certain

obligations, see Regulations section 1.6011-4 for information

relating to a disclosure statement that must be attached to

Form 8858 if certain requirements are met.

Line 6

Check “Yes” if the FB or FDE is a QBU as defined in section

989(a). If the QBU is subject to section 987, see

Schedule C-1.

Lines 7 and 8

Note. Do not complete lines 7 and 8 if you are an individual

who owns an FB or FDE directly or through tiers of FBs and

FDEs.

A base erosion payment, in general, means any amount

paid or accrued by an “applicable taxpayer” (as defined by

section 59A(e)) to a foreign person that is a related party of

the taxpayer and with respect to which a deduction is

allowable under chapter 1 of the Code. See section 59A(d).

A base erosion tax benefit, in general, means any

deduction that is allowed under chapter 1 for the tax year with

respect to any base erosion payment. See section 59A(c)(2).

See sections 59A(f) and 59A(g) for the definitions of

“foreign person” and “related party.”

Also, see the Instructions for Form 8991 for the

determination of a base erosion payment and a base erosion

tax benefit.

Line 7a

Check “Yes” if the FB or FDE received (or accrued the receipt

of) any base erosion tax payment, or had a base erosion tax

benefit, from a foreign person that is a related party of the FB

or FDE. Otherwise, check “No.”

If “Yes,” complete lines 7b and 7c, where appropriate.

Line 7b

Enter the total amount of base erosion payments received (or

accrued the receipt of) by the FB or FDE for the tax year.

Line 7c

Enter the total amount of base erosion tax benefit recognized

by the payor relating to base erosion payments reported on

line 7b. Also include on line 7c any base erosion tax benefit

taken into account in the current year from a base erosion

payment in a previous year, for example, depreciation

described in section 59A(c)(2)(A)(ii).

Line 8a

Check “Yes” if the FB or FDE paid (or accrued the payment

of) any base erosion tax payment, or had a base erosion tax

benefit, to a foreign person that is a related party of the FB or

FDE. Otherwise, check “No.”

If “Yes,” complete lines 8b and 8c, where appropriate.

Line 8b

Enter the total amount of base erosion payments paid or

accrued by the FB or FDE for the tax year.

7

Line 8c

Enter the total amount of base erosion tax benefit relating to

base erosion payments reported on line 8b. Also include on

line 8c any base erosion tax benefit taken into account in the

current year from a base erosion payment in a previous year,

for example, depreciation described in section 59A(c)(2)(A)

(ii).

Line 9

Answer line 9 only if the tax owner of the FB or FDE is a CFC.

Otherwise, skip to line 10.

Lines 10 Through 13

Complete lines 10 through 13 only if the tax owner of the FB,

or the tax owner of the interest in the FDE, is a U.S.

corporation (other than a RIC, a REIT, or an S corporation).

Otherwise, continue to Schedule H.

An FB or interest in an FDE of a U.S. corporation may be

treated as a separate unit and subject to dual consolidated

loss (DCL) rules pursuant to Regulations sections

1.1503(d)-1 through 1.1503(d)-8.

Line 10a

Check “Yes” if the FB or FDE is a separate unit under

Regulations section 1.1503(d)-1(b)(4), is not part of a

combined separate unit under Regulations section

1.1503(d)-1(b)(4)(ii), and has a DCL for the tax year. If you

checked “Yes” on line 10a, enter the amount of the DCL on

line 10b.

Line 11a

If the FB or interest in the FDE is treated as a separate unit

under Regulations section 1.1503(d)-1(b)(4), is part of a

combined separate unit, and the combined separate unit has

a DCL for the tax year, check “Yes” and go to lines 11b and

11c. Otherwise, check “No,” then skip lines 11b through 12e

and go to line 13a.

Line 11b

If you checked “Yes” on line 11a, enter the amount of the DCL

for the combined separate unit (as defined in Regulations

section 1.1503(d)-1(b)(4)). See Regulations section

1.1503(d)-5(c)(4)(ii) and complete line 11c.

Line 11c

If you checked “Yes” on line 11a, enter the net income or loss

attributed to the FB or the interest in the FDE. See

Regulations section 1.1503(d)-5(c)(4)(ii)(A).

Line 12a

Subject to certain exceptions, a domestic use of a DCL is not

permitted (“domestic use limitation rule”). A domestic use is

deemed to occur in the year the DCL is included in the

computation of the taxable income of a consolidated group,

unaffiliated dual resident corporation, or unaffiliated domestic

owner, as applicable. See Regulations section 1.1503(d)-2.

Check “Yes” on line 12a if any portion of the DCL on

line 10b or 11b was taken into account in figuring U.S.

taxable income for the year. If “Yes,” go to line 12b. If “No,” go

to line 13a.

Line 12b

A domestic use of a DCL is permitted if an exception to the

domestic use limitation rule applies. See Regulations section

8

1.1503(d)-6 for exceptions. For example, a domestic use

election made pursuant to Regulations section

1.1503(d)-6(d) is such an exception.

If you check “Yes,” you may need to include a domestic

use election with your U.S. income tax return. If the answer to

line 12b is “Yes,” go to line 12c. If the answer to line 12b is

“No,” skip line 12c and go to line 12d.

Line 12c

If you checked “Yes” on line 12b, the regulations require that

you file documentation for an exception to apply. Check “Yes”

on line 12c if you have attached any of the following

documents to your timely filed return.

• The document(s) required to be filed under an elective

agreement between the United States and a foreign country;

see Regulations section 1.1503(d)-6(b)(1).

• “No Possibility of Foreign Use of Dual Consolidated Loss

Statement”; see Regulations section 1.1503(d)-6(c).

• “Domestic Use Election and Agreement”; see Regulations

section 1.1503(d)-6(d)(1).

Line 12d

If a separate unit, as defined under Regulations section

1.1503(d)-1(b)(4), incurs a DCL after having contributed to

consolidated taxable income of a group in prior years, the

DCL may be used to offset income of domestic affiliates in

the year of the DCL (limited by the amount of the separate

unit’s prior contribution to the cumulative consolidated

taxable income of the group (“cumulative register”)). See

Regulations sections 1.1503(d)-4(c) and 1.1502-21(c).

Check “Yes” on line 12d if the DCL was used to figure

consolidated taxable income. If the DCL amount exceeds the

separate unit’s cumulative register as of the beginning of the

tax year, the amount of DCL claimed is limited to the extent of

the cumulative register and should be reflected on line 10b or

11b, as appropriate. Any excess DCL is treated as a loss

carryover subject to the separate return limitation year (SRLY)

provisions of Regulations section 1.1502-21(c), as modified

by Regulations section 1.1503(d)-4. Do not answer “Yes” to

line 12d if the DCL was used to figure consolidated taxable

income pursuant to one of the exceptions under Regulations

section 1.1503(d)-6. See lines 12b and 12c, earlier. If the

answer to line 12d is “Yes,” go to line 12e.

Check “No” on line 12d if the DCL was not used to figure

consolidated taxable income or the separate unit’s

cumulative register as of the beginning of the tax year is less

than or equal to zero. In such case, the DCL is treated as a

loss carryover subject to the SRLY provisions of Regulations

section 1.1502-21(c), as modified by Regulations section

1.1503(d)-4.

Line 12e

If the answer to line 12d is “Yes,” enter the separate unit’s

contribution to the cumulative consolidated taxable income

as of the beginning of the tax year.

Line 13a

Check “Yes” if a triggering event occurred under Regulations

section 1.1503(d)-6(e) requiring recapture of any DCLs

attributable to the FB or interest in the FDE, individually or as

part of a combined separate unit, in any prior tax years. If

“Yes,” enter the total amount of recapture on line 13b. In

addition, attach a statement to Form 8858 that provides a

detailed description of the triggering event, the regulation

Instructions for Form 8858 (Rev. 12-2024)

citation for the triggering event, and a schedule of the prior

year(s) DCL(s) being recaptured by year.

Check “No” if, with regard to each such prior year DCL,

one of the following is applicable.

• No triggering event occurred in the current tax year.

• A triggering event occurred in the current tax year;

however, a “Rebuttal to Triggering Event” is attached to the

return pursuant to Regulations section 1.1503(d)-6(e)(2).

• A triggering event occurred in the current tax year;

however, the amount of the recapture was reduced to zero

pursuant to Regulations section 1.1503(d)-6(h)(2) and a

“Reduction of Recapture Amount” is attached to the return.

Note. If there is a partial reduction of the recapture amount

pursuant to Regulations section 1.1503(d)-6(h)(2) and a

recapture amount is required to be included in income, check

“Yes,” enter the reduced amount of the DCL recapture

included in income, and attach the “Reduction of Recapture

Amount” to the return.

Line 14a

Certain jurisdictions have enacted legislation to implement

the GloBE Model Rules for the Qualified Domestic Minimum

Top-up Tax (QDMTT), Income Inclusion Rule (IIR), and

UTPR. See OECD (2021), Tax Challenges Arising from the

Digitalisation of the Economy-Global Anti-Base Erosion

Model Rules (Pillar Two) available at DOI.gov/

10.1787/782bac33-en. Under these rules, if the ETR for a

jurisdiction is below 15%, Top-up Tax may be imposed. The

amount of Top-up Tax is determined by multiplying the

Top-up Tax Percentage (the positive excess of 15% over the

ETR in the jurisdiction) by the Excess Profits (the positive

amount of the Net GloBE Income in such jurisdiction that

exceeds a Substance-based Income Exclusion). The Top-up

Tax is collected under the QDMTT, IIR, and/or UTPR.

If the FDE or FB paid or accrued any QDMTT, IIR, and/or

UTPR (or similar tax) during the tax year check "Yes" and

provide the amount of each type of tax on lines 14b(1)

through 14b(3), as applicable.

For more information, see Notice 2023-80, I.R.B. 2023-52

1583 available at IRS.gov/IRB/2023-52_IRB#NOT-2023-80.

Schedule H—Current Earnings and

Profits or Taxable Income

Use Schedule H to report the FDE's current E&P or the FB’s

income (if the tax owner is a CFC) or the FDE’s or FB’s

taxable income (if the tax owner is a U.S. person or a CFP).

Generally, enter the amounts on lines 1 through 6 in

functional currency.

Special rules for DASTM. If the FDE or FB uses DASTM,

enter on line 1 the U.S. dollar GAAP income or loss from

line 14 of Schedule C. Enter on lines 2 and 3 the adjustments

made in figuring current E&P or taxable income for U.S. tax

purposes. Report these amounts in U.S. dollars. Enter on

line 5 the DASTM gain or loss figured under Regulations

section 1.985-3(d).

Lines 2 and 3

Certain adjustments must be made to the FDE’s or FB’s

line 1 net book income or loss to determine its current E&P or

taxable income. The adjustments may include those needed

to conform the foreign book income to U.S. GAAP and to U.S.

tax accounting principles. If the FDE’s or FB’s books are

maintained in functional currency in accordance with U.S.

Instructions for Form 8858 (Rev. 12-2024)

GAAP, enter on line 1 the functional currency GAAP income

or loss from line 14 of Schedule C, rather than starting with

foreign book income, and show GAAP-to-tax adjustments on

lines 2 and 3.

The adjustments may include the following.

• Capital gains and losses.

• Depreciation, amortization, and depletion.

• Investment or incentive allowance.

• Charges to statutory reserves.

• Inventory adjustments. Inventories must be taken into

account according to the rules of sections 471 (incorporating

the provisions of section 263A) and 472 and the related

regulations.

• Taxes. See the instructions for Schedule C, line 13, earlier.

Attach a separate schedule that lists each applicable

adjustment item. For each adjustment item, indicate the

adjustment amount and whether the amount is a net addition

or net subtraction. The separate schedule should also show

two totals, the total net additions amount to be entered on

line 2, and the total net subtractions amount to be entered on

line 3.

Line 5

DASTM gain or loss, reflecting unrealized exchange gain or

loss, should be entered on line 5 only for FDEs or FBs that

use DASTM.

Line 7

Enter on line 7 the functional currency amount translated into

U.S. dollars at the average exchange rate for the FDE’s or

FB’s tax year. See section 989(b). Report the exchange rate

using the “divide-by convention” specified under Reporting

Exchange Rates on Form 8858, earlier. If the FDE or FB uses

DASTM, enter on line 7 the same amount entered on line 6.

Blocked income. The E&P or taxable income of the FDE or

FB, as reflected on Schedule H, must not be reduced by all or

any part of such E&P or taxable income that could not have

been distributed by the FDE or FB due to currency or other

restrictions or limitations imposed under the laws of any

foreign country.

Schedule I—Transferred Loss Amount

Important: Schedule I should be completed if the FB or FDE

is owned:

• Directly by a domestic corporation, or

• Indirectly by a domestic corporation through a tiered

structure of FDEs or FBs.

Schedule I should not be completed if the FB or FDE is

owned by a CFC.

Line 1

Check “Yes” if any assets of an FB (or a branch that is an

FDE) were transferred to a foreign corporation during the tax

year. If “Yes,” continue to line 2; otherwise, check “No” and do

not complete the rest of Schedule I.

Line 2

Check “Yes” if the transferor was a domestic corporation that

transferred substantially all of the assets of an FB (or a

branch that is an FDE) to a specified 10%-owned foreign

corporation. A specified 10%-owned foreign corporation is

defined in section 245A(b)(1) as any foreign corporation with

respect to which any domestic corporation is a U.S.

shareholder with respect to such corporation. If “Yes,”

9

continue to line 3; otherwise, check “No” and do not complete

the rest of Schedule I.

Line 3

Check “Yes” if the transferor was a domestic corporation and

immediately after the transfer the domestic corporation was a

U.S. shareholder (10%-or-more shareholder) with respect to

the transferee foreign corporation. If “Yes,” continue to line 4;

otherwise, check “No” and do not complete the rest of

Schedule I.

Line 4

Under section 91, the U.S. transferor must include in gross

income an amount equal to the transferred loss amount

(TLA), if any, as defined in section 91(b) upon a transfer of

substantially all of the assets of an FB (including an FB that is

an FDE) to a foreign corporation. The TLA is the sum of

losses incurred by the FDE or FB after 2017, and before the

transfer and with respect to which a deduction was allowed to

the U.S. transferor reduced by the sum of:

1. Any taxable income of such branch for a tax year after

the tax year in which the loss was incurred and through the

close of the tax year of the transfer, and

2. Any amount recognized under section 904(f)(3)

resulting from the transfer.

Also, see section 14102(d)(4) of the Tax Cuts and Jobs Act

(TCJA) for the transition rule of section 91.

The TLA amount may be reduced (but not below zero) by

the amount of gain recognized on account of the transfer,

other than the amounts recognized under section 904(f)(3), if

any. Enter the amount of the TLA included in gross income as

a positive number on line 4.

If the amount is equal to or less than zero, enter zero and

no TLA is required to be recognized by the U.S. transferor on

the transfer under section 91. If the amount is greater than

zero, enter the TLA on line 4 and report this amount as other

income on the applicable Form 1120 (for Form 1120 filers,

page 1, line 10, Other income) and identify the amount as

“Section 91 Transferred Loss Amount.” In addition, attach a

“Schedule I—Transferred Loss Amount Additional

Information” statement to the Form 8858 and provide the

following information.

• A detailed calculation of the transferred loss amount

reflecting amounts of the losses generated by such foreign

branch after 2017 by year, and any income amounts by year

generated after such loss year.

• The amount, if any, recognized under section 904(f)(3) on

account of the transfer.

• A detailed summary of the gain recognized (other than

section 91) by the transferor, including any section 367(a)(1)

gain on the transfer of property.

• A calculation of the net sum of the previously deducted

losses incurred by such foreign branch for tax years prior to

January 1, 2018, that would have been recaptured under

section 367(a)(3)(C), as determined without regards to the

repeal of the section 367(a)(3) active trade or business

exception by section 14102 of the TCJA.

Schedule J—Income Taxes Paid or

Accrued

List income, war profits, and excess profits taxes (“income

taxes”) paid or accrued to the United States and to each

foreign country or U.S. territory for the foreign entity’s foreign

tax year(s) that end with or within its U.S. tax year, or in the

10

case of income taxes paid or accrued by a CFC or CFP, with

or within its annual accounting period. Do not report taxes

that are not creditable, including taxes for which a credit is

disallowed under section 901(j), (k), (l), or (m).

Except as provided below, adjustments to foreign income

taxes paid or accrued in a prior year should not be reflected

on the Form 8858 in the year of adjustment. Instead, they are

reported in the year to which such taxes relate. This may

require an amended return. See section 905(c), as amended

by the TCJA. Adjustments include, for example, additional

payments, refunds, and downward adjustments for accrued

foreign taxes that are not paid within 24 months after the

close of the tax year to which such taxes relate. For more

information, see Regulations section 1.905-3.

Exception. With respect to entities owned directly by a U.S.

person, certain de minimis adjustments may be taken into

account in the year of such adjustment. See Regulations

section 1.905-3(b)(1).

Column (a). Enter the two-letter country code (from the list

at IRS.gov/CountryCodes) of all foreign countries and U.S.

territories within which income is sourced and/or to which

taxes were paid, accrued, or deemed paid.

Column (b). Enter the foreign tax year (YYYY-MM-DD) of

the foreign entity to which the tax relates.

Columns (c) through (e). Report foreign income taxes in

column (c) in the local currency in which the taxes are

payable. Translate these amounts into U.S. dollars (column

(e)) at the average exchange rate for the tax year to which the

tax relates (column (d)) unless one of the exceptions below

applies. See section 986(a).

Exceptions. If one of the following exceptions applies, use

the exchange rate in effect on the date the foreign entity paid

the tax.

1. The tax is paid before the beginning of the year to

which the tax relates.

2. Accrued taxes are not paid before the date 2 years

after the close of the tax year to which such taxes relate.

3. There is an election in effect under section 986(a)(1)

(D) to translate foreign taxes using the exchange rate in effect

on the date of payment.

4. The foreign entity reports on the cash basis. See

section 986(a).

5. The foreign income taxes are denominated in a foreign

currency that is an inflationary currency.

Enter the exchange rate used in column (d). Report the

exchange rate using the “divide-by convention” specified

under Reporting Exchange Rates on Form 8858, earlier.

Enter the translated U.S. dollar amount in column (e).

Columns (f) through (i). Enter the amount by separate

category of income in columns (f) through (i).

Example. Form 8858 is filed for calendar year 2024. A

CFC, which has a calendar year as its annual accounting

period, owns FDEs in countries AA and BB. The FDE in

country AA pays or accrues income tax of 10u = $10 to

country AA with respect to its foreign tax year ending

November 30, 2024. The FDE in country BB pays or accrues

income tax of 20v = $30 to country BB with respect to its

foreign tax year ending March 31, 2024. In addition, in 2024,

the CFC received a refund of 3u or $5 with respect to the

entity it owns in country AA for foreign tax year ending

November 30, 2023, which had an original liability of 21u or

Instructions for Form 8858 (Rev. 12-2024)

$35. All taxes are allocated to the general category. The

following entries should be made on Schedule J of the Form

8858 filed for calendar year 2024.

Line 1

• column (a): Country code AA

• column (b): 2024-11-30

• column (c): 10u

• column (d): 1.0000

• column (e): $10

• column (h): $10

Line 2

• column (a): Country code BB

• column (b): 2024-03-31

• column (c): 20v

• column (d): 0.6666

• column (e): $30

• column (h): $30

See the filled-in example of Schedule J, later.

2023 refund. The refund from tax year 2023 is not

reported on the 2024 Form 8858. The following entries

should be made on Schedule J of the amended Form 8858

filed for the calendar year 2023.

• column (a): Country code AA

• column (b): 2023-11-30

• column (c): 18u

• column (d): 0.6000

• column (e): $30

• column (h): $30

Example—Filled-in Schedule J for Calendar Year 2024

Schedule J

Income Taxes Paid or Accrued (see instructions)

Foreign Income Taxes

Foreign Tax Credit Separate Categories

(a)

Country or

territory

(b)

Foreign tax year

(YYYY-MM-DD)

(c)

Foreign currency

(d)

Conversion rate

(e)

U.S. dollar

AA

2024-11-30

10u

1.0000

10

10

BB

2024-03-31

20v

0.6666

30

30

40

40

Totals

For additional instructions on the reporting of foreign taxes

for entities filing a Form 8858 that are owned by a foreign

corporation, see the instructions for Form 5471, Schedule E.

For purposes of column (i), enter foreign income taxes

allocated and apportioned to a separate category of income

not otherwise listed in column (f), (g), or (h). Identify the taxes

with respect to each separate category of income. For

example, if a foreign entity pays taxes to Country A that are

allocated and apportioned to two separate categories of

income, report the taxes allocated and apportioned to the

first separate category on one line and the taxes allocated

and apportioned to the other separate category on another

line. For purposes of determining the applicable categories of

income, see Categories of Income in the Instructions for

Form 1118 or in the Instructions for Form 1116, as applicable.

Schedule M (Form

8858)—Transactions Between Foreign

Disregarded Entity (FDE) or Foreign

Branch (FB) and the Filer or Other

Related Entities

Important: In translating the amounts from functional

currency to U.S. dollars, use the average exchange rate for

the FDE’s or FB’s tax year. See section 989(b). Report the

exchange rate in the entry space provided at the top of

Schedule M (Form 8858) using the “divide-by convention”

specified under Reporting Exchange Rates on Form 8858,

earlier.

A Schedule M (Form 8858) must be filed with each Form

8858 if the FDE or FB entered into any transaction with the

filer of the Form 8858 or other related entities during the

annual accounting period of the FDE or FB.

Instructions for Form 8858 (Rev. 12-2024)

(f)

Foreign branch

(g)

Passive

(h)

General

(i)

Other

Every U.S. person that is required to file Schedule M

(Form 8858) (see Who Must File, earlier) must file the

schedule to report the transactions that occurred during the

FDE’s or FB’s annual accounting period ending with or within

the U.S. person's tax year.

If a U.S. corporation is the U.S. person filing Schedule M

(Form 8858) and is a member of a consolidated group, list

the common parent as the U.S. person filing Schedule M

(Form 8858).

Reference ID number. A reference ID number for the FDE

or FB identified on Schedule M (Form 8858) is required if no

EIN is provided. However, filers are permitted to provide both

an EIN and reference ID number. For more information on the

reference ID number, see Line 1b(2)—Reference ID number,

earlier.

Column headings. There are three sets of column

headings above lines 1 through 21. The first set of column

headings is to be used in cases where the tax owner is a

CFP. The second set of column headings is to be used in

cases where the tax owner is a CFC. The third set of column

headings is to be used in cases where the tax owner is a U.S.

person. If you are completing Schedule M (Form 8858) for an

FDE or FB for which the tax owner is a CFP, check the box for

CFPs and complete lines 1 through 21 using the headings in

columns (a) through (e) of the CFP set of columns. If you are

completing Schedule M (Form 8858) for an FDE or FB for

which the tax owner is a CFC, check the box for CFCs and

complete lines 1 through 21 using the headings in columns

(a) through (f) of the CFC set of columns. If you are

completing Schedule M (Form 8858) for an FDE or FB for

which the tax owner is a U.S. person, check the box for U.S.

Tax Owner and complete lines 1 through 21 using the

headings in columns (a) through (e) of the U.S. Tax Owner

set of columns.

11

Column (e). For CFP- or CFC-owned FDEs or FBs, use

column (e) to report transactions between the FDE or FB and

any U.S. person with a 10%-or-more direct interest in the

CFP or any 10%-or-more U.S. shareholder of any corporation

controlling the CFC. If you are a category 1 filer of Form

8865, or a category 4 filer of Form 5471, do not report

transactions between yourself and the FDE or FB under

column (e). Report the transactions only under column (b).

U.S. tax owner. The following instructions for columns (b)

through (e) apply only to an FDE or FB with a U.S. tax owner.

Column (b). Use column (b) to report transactions

between the FDE or FB with the U.S. person filing this return

only if the U.S. person filing this return is other than the tax

owner of the FDE or FB. If the U.S. person filing this return is

the tax owner of the FDE or FB, do not enter any amounts in

column (b).

Column (c). Use column (c) to report transactions

between the FDE or FB with any domestic corporation or

partnership controlled by the filer. Do not include any

transactions between the FDE or FB with its direct U.S. tax

owner that are treated as disregarded for U.S. tax purposes

in column (c).

Column (d). Use column (d) to report transactions

between the FDE or FB with any foreign corporation

(including its FBs or FDEs) controlling or controlled by the

filer. This will include any transactions between the FDE or

FB with any foreign corporation (including its FBs or FDEs)

controlling or controlled by the FDE’s or FB’s U.S. tax owner,

if the U.S. tax owner of the FDE or FB is not the U.S. person

filing the return.

Column (e). Use column (e) to report transactions

between the FDE or FB with any foreign (including hybrid)

partnerships (including its FBs or FDEs) controlling or

controlled by the filer. This will include any transactions

between the FDE or FB with any foreign (including hybrid)

partnership (including its FBs or FDEs) controlling or

controlled by the FDE’s or FB’s U.S. tax owner, if the U.S. tax

owner of the FDE or FB is not the U.S. person filing the

return.

Line 6. Report on line 6 dividends received by the FDE that

were not previously taxed under subpart F in the current year

or in any prior year.

Lines 20 and 21. Report on lines 20 and 21 the largest

outstanding balances during the year of gross amounts

borrowed from, and gross amounts loaned to, the related

parties described in columns (b) through (f). Do not enter

aggregate cash flows, year-end loan balances, average

balances, or net balances. Do not include open account

balances resulting from sales and purchases reported under

other items listed on Schedule M (Form 8858) that arise and

are collected in full in the ordinary course of business.

Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the

United States. You are required to give us the information. 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.

You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless

the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as

their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return

information are confidential, as required by section 6103.

The time needed to complete and file this form and related schedules will vary depending on individual circumstances. The

estimated burden for individual taxpayers filing this form is approved under OMB control number 1545-1910 and is included in

the estimates shown in the instructions for their individual income tax return. The estimated burden for all other taxpayers who

file this form is shown below.

Form

Recordkeeping

Learning about the

law or the form

Preparing and sending

the form to the IRS

8858

25 hr., 49 min.

4 hr., 46 min.

5 hr., 24 min.

Sch. M (Form 8858)

24 hr., 9 min.

6 min.

30 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form and related

schedules simpler, we would be happy to hear from you. See the instructions for the tax return with which this form is filed.

12

Instructions for Form 8858 (Rev. 12-2024)