Instructions for Form 4626

2025

Instructions for Form 4626

Alternative Minimum Tax—Corporations

Section references are to the Internal Revenue Code

unless otherwise noted.

Future Developments

Consolidated returns. For an affiliated group filing a

consolidated return under the rules of section 1501,

CAMT is calculated on a consolidated basis.

Who Must File

For the latest information about developments related to

Form 4626 and its instructions, such as legislation

enacted after they were published, go to IRS.gov/

Form4626.

Unless a filing exclusion applies, a corporation must file

Form 4626 to determine whether it is an applicable

corporation and, if it is classified as an applicable

corporation, to calculate CAMT.

What’s New

Filing exclusions. A corporation is not required to file

Form 4626 if the corporation is:

• An S corporation;

• A regulated investment company (RIC);

• A real estate investment trust (REIT);

• A tax-exempt entity that is not required to file an exempt

organization business income tax return because it has no

unrelated business taxable income (even if such entity is a

member of a controlled group treated as a single employer

under sections 59(k)(1)(D) and 52(a) or (b)); or

• A corporation that is not required to file Form 4626

because it is not an applicable corporation under the

interim simplified method or simplified method and

chooses to apply that method. This filing exception does

not apply if the corporation is an applicable corporation in

the current tax year because the corporation was an

applicable corporation in a prior tax year.

New Item C. Item C was added to Form 4626. See the

instructions for Item C.

Interim simplified method. New optional interim

simplified method for determining applicable corporation

status provides a higher safe harbor threshold. If met, the

corporation is not required to complete Form 4626. See

Simplified Methods for Determining Applicable

Corporation Status and new Interim Simplified Method

(Safe Harbor) Calculation Worksheet.

Interim guidance for determining adjusted financial

statement income (AFSI) with respect to partnerships. Notice 2025-28 provides interim guidance

simplifying the application of the Corporate Alternative

Minimum Tax (CAMT) to partnerships and CAMT entity

partners. For more information, see Notice 2025-28,

2025-34 I.R.B. 316, available at IRS.gov/irb/

2025-34_IRB#NOT-2025-28.

Interim guidance on the application of the CAMT to

domestic corporate transactions, financially troubled

companies, tax consolidated groups, and acquired financial statement net operating losses and certain

built-in items. Notice 2025-46 provides interim guidance

to simplify the application of the CAMT to domestic

corporations. For more information, see Notice 2025-46,

2025-43 I.R.B. 533, available at IRS.gov/irb/

2025-43_IRB#NOT-2025-46.

Interim guidance on the application of the CAMT under sections 55, 56A, and 59. Notice 2025-49 provides

rules for certain adjustments to AFSI and rules for

proposed applicability dates and reliance on the CAMT

proposed regulations (described later). For more

information, see Notice 2025-49, 2025-44 I.R.B. 627,

available at IRS.gov/irb/2025-44_IRB#NOT-2025-49.

General Instructions

Purpose of Form

Form 4626 is used to determine whether a corporation is

an applicable corporation under section 59(k) and to

calculate CAMT under section 55 for applicable

corporations.

Jan 29, 2026

When To File

Attach Form 4626 to the corporation’s income tax return

(or, if applicable, exempt organization business income

tax return) and file by the due date (including extensions)

for that return.

Interim Guidance

Proposed Regulations—Proposed Applicability

Dates and Reliance Prior to Applicability

The Treasury Department and the IRS issued a Notice of

Proposed Rulemaking published in the Federal Register

on September 13, 2024. See 89 FR 75062, as corrected

by 89 FR 104909. Until finalized, these proposed

regulations are non-binding and subject to change. Some

sections of the proposed regulations are proposed to

apply to tax years ending after September 13, 2024

(“specified proposed regulations”). When final regulations

are published in the Federal Register, these sections

would apply to tax years ending after September 13,

2024. Other sections of the proposed regulations are

proposed to apply to tax years ending after the date that

final regulations are published in the Federal Register

(“other proposed regulations”). Corporations would not be

required to apply these sections of the proposed

regulations until final regulations are published in the

Federal Register. Special rules, discussed below, are

Instructions for Form 4626 (2025) Catalog Number 64443L

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

provided for corporations that choose to rely on sections

of the proposed regulations for tax years ending on or

before their proposed applicability dates.

Specified Proposed Regulations—Proposed

Applicability Date

The following sections of the proposed regulations apply

to tax years ending after, and, in certain cases, transfers

(as defined in Proposed Regulations section 1.56A-4(b)

(3)) occurring after, September 13, 2024.

• Proposed Regulations sections 1.56A-1 through

1.56A-4.

• Proposed Regulations sections 1.56A-6 through

1.56A-11.

• Proposed Regulations section 1.56A-13.

• Proposed Regulations section 1.56A-14.

• Proposed Regulations section 1.56A-17.

• Proposed Regulations section 1.56A-26.

• Proposed Regulations section 1.56A-27.

• Proposed Regulations sections 1.59-2 through 1.59-4.

The provisions of Proposed Regulations section

1.56A-5(l)(2)(ii) and (iii) apply to tax years ending after

September 13, 2024, and on or before the date of

publication of final regulations in the Federal Register, in

order to coordinate certain provisions of the specified

proposed regulations.

Reliance on Specified Proposed Regulations for

Tax Years Ending Before Proposed Applicability

Date

Corporations may rely on the specified proposed

regulations for any tax year ending on or before

September 13, 2024, provided the corporation, and each

member of its test group determined under Proposed

Regulations section 1.59-2 for that tax year, consistently

follows all of the specified proposed regulations in their

entirety in that tax year and each subsequent tax year

(taking into account any changes to its test group

determined under Proposed Regulations section 1.59-2

for each subsequent tax year) until the first tax year in

which the final regulations are applicable and also applies

the rules described in Proposed Regulations sections

1.56A-4 and 1.56A-6 that apply to transfers (as defined in

Proposed Regulations section 1.56A-4(b)(3)) to any

transfers occurring in such years.

A corporation may rely on the rules described in

Proposed Regulations sections 1.56A-4 and 1.56A-6 that

apply to transfers for a transfer occurring on or before

September 13, 2024, provided the corporation, and each

member of its test group determined under Proposed

Regulations section 1.59-2 for the tax year of the

corporation that includes the date of the transfer,

consistently follow all of the rules in Proposed Regulations

sections 1.56A-4 and 1.56A-6 for all such transfers

occurring on or before September 13, 2024, during a tax

year of the taxpayer and each subsequent tax year until

the final regulations are applicable to such transfers, and if

any such transfers occur in tax years ending on or before

September 13, 2024, must rely on the specified proposed

regulations for such tax years.

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Other Proposed Regulations—Proposed

Applicability Dates

The following sections of the proposed regulations apply

to tax years ending after the date the final regulations are

published in the Federal Register:

• Proposed Regulations section 1.56A-5 (other than

section 1.56A-5(l)(2)(ii) and (iii)).

• Proposed Regulations section 1.56A-12.

• Proposed Regulations section 1.56A-15.

• Proposed Regulations section 1.56A-16.

• Proposed Regulations sections 1.56A-18 through

1.56A-25.

The provisions of the following sections apply to

consolidated return years for which the due date of the

income tax return (without extensions) is after the date of

publication of final regulations in the Federal Register:

• Proposed Regulations section 1.1502-2.

• Proposed Regulations section 1.1502-53.

• Proposed Regulations section 1.1502-56A.

Reliance on Other Proposed Regulations for Tax

Years Ending Before Proposed Applicability

Date

Corporations may rely on one or more of the other

proposed regulations for any tax year ending on or before

the date the final regulations are published in the Federal

Register provided that, for each section on which the

corporation relies, the corporation, and each member of

its test group determined under Proposed Regulations

section 1.59-2 for that tax year, consistently follow that

section in its entirety and also follow all of the specified

proposed regulations in their entirety in that tax year and

each subsequent tax year (taking into account any

changes to its test group determined under Proposed

Regulations section 1.59-2) until the first tax year in which

the final regulations are applicable and also applies the

rules described in Proposed Regulations sections 1.56A-4

and 1.56A-6 that apply to transfers (as defined in

Proposed Regulations section 1.56A-4(b)(3)) to any

transfers occurring in such years. Notwithstanding the

prior sentence, a corporation may not rely on Proposed

Regulations sections 1.56A-18, 1.56A-19, and 1.56A-21

in any tax year unless the corporation and each member

of its test group determined under Proposed Regulations

section 1.59-2 for that tax year rely on each of those

sections in its entirety. In addition, Notice 2025-28

provides that a taxpayer may rely on Proposed

Regulations section 1.56A-5 (excluding Proposed

Regulations sections 1.56A-5(l)(2)(ii) and (iii)) if the

taxpayer and each member of its test group determined

under Proposed Regulations section 1.59-2 consistently

follow that section in its entirety, regardless of whether the

taxpayer also relies on Proposed Regulations section

1.56A-20, and vice versa.

Reliance on Interim Notice Guidance

The Treasury Department and the IRS also issued interim

guidance published in the Internal Revenue Bulletin.

• Notice 2025-27, 2025-26 I.R.B. 1615, available at

IRS.gov/irb/2025-26_IRB#NOT-2025-27.

• Notice 2025-28, 2025-34 I.R.B. 316, available at

IRS.gov/irb/2025-34_IRB#NOT-2025-28.

Instructions for Form 4626 (2025)

• Notice 2025-46, 2025-43 I.R.B. 533, available at

IRS.gov/irb/2025-43_IRB#NOT-2025-46.

• Notice 2025-49, 2025-44 I.R.B. 627, available at

IRS.gov/irb/2025-44_IRB#NOT-2025-49.

corporation must provide an explanation of the legal basis

for the line items; for example, the statute or applicable

notice provision.

Taxpayers may be able to rely on some or all of the

interim guidance provided, subject to the following

applicability dates and reliance conditions for each of the

notices:

Applicable Corporation

A corporation may use the interim simplified method

provided in Notice 2025-27 for determining applicable

corporation status for any tax year ending on or before the

date that a Treasury Decision adopting a simplified

method pursuant to section 59(k)(3)(A) is published in the

Federal Register and for which the original federal income

tax return has not been filed as of June 23, 2025.

Notice 2025-28 provides interim guidance on the

application of the CAMT to partnerships and corporations

that are partners in partnerships. The interim guidance

simplifies the application of the CAMT by providing (i)

optional top-down and taxable-income elections, and

modified proposed section 1.56A-5 methods to compute a

partner’s distributive share of a partnership’s AFSI, (ii) two

optional methods to compute adjusted financial statement

income attributable to partnership contributions and

distributions, and (iii) that certain non-realization amounts

are disregarded in computing AFSI. Taxpayers may rely

on the guidance in Notice 2025-28 until further guidance

is issued.

Notice 2025-46 provides interim guidance on the

application of the CAMT to domestic corporate

transactions, financially troubled companies, tax

consolidated groups, and acquired financial statement net

operating losses and certain built-in items. The interim

guidance would simplify the application of the CAMT to

domestic corporations by: (i) more closely aligning the

rules for domestic corporate transactions with regular tax

rules applicable to those transactions, but using CAMT

inputs; (ii) clarifying the application of sections 108 and

1017 to troubled companies; (iii) simplifying the

application of rules applicable to tax consolidated groups

by incorporating by reference, with appropriate

modifications, certain rules in the consolidated return

regulations; and (iv) providing that the limitations on the

use of acquired financial statement net operating losses

and certain built-in items do not apply for purposes of

computing AFSI. Taxpayers may rely on Notice 2025-46

until proposed regulations are issued.

Notice 2025-49 provides additional interim guidance on

the applicability dates and reliance rules provided in the

CAMT proposed regulations, AFSI adjustments for certain

items measured at fair value, and specific other AFSI

adjustments.

Statement of Rules Applied

Corporations must include with Form 4626 a statement

describing the approach taken in completing Form 4626

and the guidance relied upon. For example, if the

corporation applied provisions of the proposed regulations

for certain line items, it must list the sections of the

proposed regulations which it applied. If one or more line

items are not based on the proposed regulations, the

Instructions for Form 4626 (2025)

Definitions

An applicable corporation is, with respect to any tax year,

any corporation (other than an S corporation, a RIC, or a

REIT) that satisfies an average annual adjusted financial

statement income test (the AFSI Test) for 1 or more tax

years which are prior to the current tax year and end after

December 31, 2021. See section 59(k)(1)(A). Also, see

the instructions for Part I—Applicable Corporation

Determination.

Adjusted Financial Statement Income (AFSI)

AFSI is, with respect to any corporation for any tax year,

the corporation’s net income or loss on its applicable

financial statement (AFS) (defined later) for that tax year

with specific adjustments including those noted below.

See sections 56A and 59(k) for more information. Also,

see the instructions for Part I—Applicable Corporation

Determination, and Part II—Corporate Alternative

Minimum Tax (CAMT).

• Section 56A(c)(1) provides that appropriate

adjustments to AFSI shall be made in any case in which

an AFS covers a period other than the tax year.

• If the corporation is part of a tax consolidated group for

any tax year, the AFSI for that group for that tax year must

take into account items on the group’s AFS that are

properly allocable to the group’s members.

• For any corporation that is not included on a

consolidated return with the taxpayer corporation, the

taxpayer corporation’s AFSI with respect to the other

corporation is determined by only taking into account the

dividends received from that corporation and other

amounts which are includible in gross income or

deductible as a loss under Chapter 1 of the Internal

Revenue Code (other than amounts required to be

included under sections 951 and 951A) with respect to

that corporation.

Corporate Alternative Minimum Tax Entity

The term “CAMT entity” means any entity identified in

section 7701 and the related regulations, other than a

disregarded entity. See Proposed Regulations section

1.56A-1(b)(8).

• If a CAMT entity is a partner in a partnership, the CAMT

entity’s AFSI with respect to that partnership is adjusted to

consider only the CAMT entity’s distributive share of that

partnership’s AFSI. A partnership’s AFSI is the net income

or loss on that partnership’s AFS adjusted under rules

similar to those in section 56A.

• A disregarded entity or branch and the CAMT entity that

owns the disregarded entity or branch (including through

other disregarded entities or branches) are treated as a

single CAMT entity for purposes of determining AFSI. See

Proposed Regulations section 1.56A-9.

• If the CAMT entity is a U.S. shareholder of one or more

controlled foreign corporations (CFCs), its AFSI with

respect to the CFCs is adjusted to take into account its

pro-rata share (determined under rules similar to the rules

3

in section 951(a)(2)) of items taken into account in

calculating the net income or loss set forth on each CFC’s

AFS, as adjusted under rules similar to those that apply in

determining AFSI. This amount is referred to as a CFC’s

adjusted net income or loss.

Proposed Regulations section 1.56A-6(c) provides that

a CFC’s adjusted net income or loss is not limited to

effectively connected income.

If the AFSI adjustment is negative, no adjustment is

made for that tax year. However, any adjustment in a

succeeding tax year is reduced by that negative amount.

• A foreign corporation’s AFSI is generally determined

under the principles of section 882, which provides that a

foreign corporation is subject to CAMT only on income

that is effectively connected with the conduct of a trade or

business in the United States.

Note: Proposed Regulations section 1.56A-7 provides

that a foreign corporation’s AFSI is adjusted to take into

account only amounts and items that would be included in

income effectively connected with the conduct of a trade

or business within the United States or allowable as a

deduction by such corporation for purposes of section

882(c) had such amount or item accrued for regular tax

purposes in the tax year.

• AFSI is adjusted to disregard federal income taxes, and

income, war profits, and excess profits taxes (within the

meaning of section 901), with respect to a foreign country

or U.S. territory which are taken into account on the

corporation’s AFS.

• A section 1381 cooperative’s AFSI excludes section

1382(b) cooperative patronage dividends and per-unit

retain allocations not otherwise used in calculating AFSI.

• An Alaska native corporation’s AFSI is adjusted to

allow:

1. Cost recovery and depletion attributable to property

with a basis determined by the Alaska Native Claims

Settlement Act (the Act) (43 U.S.C. section 1602(c)); and

2. Deductions for amounts payable under section 7(i)

or 7(j) of the Act (43 U.S.C. section 1602(i) and (j)) only

when the deductions are allowed for federal income tax

purposes. “Federal income tax purposes” as used in these

instructions excludes CAMT.

• AFSI excludes amounts treated as payments against a

federal income tax pursuant to an election under section

48D(d) or section 6417 or, in the case of a CAMT entity

that relies on Proposed Regulations section 1.56A-12(b)

(2), certain amounts received from the transfer of an

eligible credit, as defined in section 6418(f)(1)(A).

• AFSI is adjusted to not include any item of income in

connection with a mortgage servicing contract prior to the

amount being included in income for federal income tax

purposes.

• AFSI adjustments for covered benefit plans are:

1. Adjustments to disregard any income, cost, or

expense that would otherwise be included on the AFS in

connection with any covered benefit plan;

2. Increases for any covered benefit plan income that

is included in the CAMT entity’s gross income for federal

income tax purposes; and

4

3. Decreases for any covered benefit plan deduction

allowed to the CAMT entity for federal income tax

purposes.

A covered benefit plan under section 56A(c)(11)(B) is a

defined benefit plan (other than a multiemployer plan

described in section 414(f)) that is qualified under section

401(a) with a trust exempt under section 501(a), any

qualified foreign plan as defined in section 404A(e), or any

other defined benefit plan which provides

post-employment benefits other than pension benefits.

• The AFSI of a tax-exempt entity subject to the section

511 unrelated business income tax is adjusted to only

take into account AFSI (if any) of an unrelated trade or

business (as defined in section 513) of the organization,

subject to the modifications to unrelated business taxable

income described in section 512(b). AFSI determined

under the preceding sentence includes any unrelated

debt-financed income determined under section 514. See

section 512(b)(4).

• AFSI is reduced by section 167 depreciation deductions

on section 168 property that are allowed in calculating

taxable income for the tax year and adjusted to remove

any book expense, depreciation expense, or other cost

recovery expense included in the CAMT entity’s AFS for

the section 168 property.

• AFSI is reduced by any qualified wireless spectrum

amortization deductions allowed under section 197 in

calculating taxable income for the tax year and adjusted to

remove any book expense, amortization expense, or other

cost recovery expense included in the CAMT entity’s AFS

for the qualified wireless spectrum. For AFSI purposes,

qualified wireless spectrum is wireless spectrum that is

used in the trade or business of a wireless

telecommunications carrier and was acquired after

December 31, 2007, and before August 16, 2022.

• Proposed Regulations section 1.56A-27(b) provides

that AFSI of a foreign government is adjusted so as not to

take into account any amount of FSI that, if it were

properly treated as gross income for regular tax purposes,

would be excluded from gross income and exempt from

taxation under subtitle A pursuant to section 892.

• Section 56A(c)(15) authorizes guidance providing for

additional adjustments to AFSI, including those necessary

to prevent the duplication or omission of an item.

Proposed Regulations section 1.56A-17 provides for

additional adjustments to AFSI available to corporations

who rely on the interim guidance. See Interim Guidance,

earlier.

Applicable Financial Statement (AFS)

Proposed Regulations section 1.56A-2 defines a

corporation’s “AFS” as the corporation’s highest priority

financial statement of the following financial statements

which are listed in descending order of priority: either a

certified generally accepted accounting principles (GAAP)

statement, a certified international financial reporting

standards (IFRS) statement, a certified financial statement

prepared in accordance with other generally accepted

accounting standards or an “other statement” filed with a

federal, state, or foreign government agency thereof or a

self-regulatory organization, as provided in Proposed

Regulations section 1.56A-2(c)(1) through (4). For this

purpose, Proposed Regulations section 1.56A-2(d)

Instructions for Form 4626 (2025)

defines a financial statement as “certified” if an

independent financial statement auditor has provided an

unqualified or unmodified clean opinion; a qualified or

modified except for opinion or an adverse opinion (but

only if the auditor for such adverse opinion discloses the

amount of the disagreement with the statement). For a

corporation that is relying on the proposed regulations,

and does not have a certified financial statement or an

“other statement,” the AFS is an “unaudited external

statement,” or a federal income tax return or information

return filed with the IRS, as provided in Proposed

Regulations section 1.56A-2(c)(5) and (6). These

statements are described in more detail below in their

descending order of priority.

• A GAAP statement is an audited financial statement,

other than a tax return, that is certified as being prepared

in accordance with U.S. generally accepted accounting

principles and is:

1. A Form 10-K (or successor form), or annual

statement to shareholders, filed with the U.S. Securities

and Exchange Commission (SEC);

2. A financial statement that is used for credit

purposes; reporting to shareholders, partners, or other

proprietors, or to beneficiaries; or any other substantial

nontax purpose; or

3. A financial statement filed with the federal

government or any federal agency, other than the SEC or

the IRS.

• An IFRS statement is an audited financial statement,

other than a tax return, that is certified as being prepared

in accordance with international financial reporting

standards and is:

1. Filed with the SEC or an agency of a foreign

government that is equivalent to the SEC;

2. A financial statement that is used for credit

purposes; reporting to shareholders, partners, or other

proprietors, or to beneficiaries; or any other substantial

nontax purpose; or

3. A financial statement filed with the federal

government, any federal agency, a foreign government, or

agency of a foreign government, other than the SEC, the

IRS, or an agency that is equivalent to the SEC or the IRS.

• An audited financial statement that is certified as being

prepared in accordance with accepted accounting

standards other than GAAP and IFRS that are issued by

an accounting standards board charged with developing

accounting standards for one or more jurisdictions and is:

1. Filed with the SEC or an agency of a foreign

government that is equivalent to the SEC;

2. A financial statement that is used for credit

purposes; reporting to shareholders, partners, or other

proprietors, or to beneficiaries; or any other substantial

nontax purpose; or

3. A financial statement filed with the federal

government, any federal agency, a foreign government, or

agency of a foreign government, other than the SEC, the

IRS, or an agency that is equivalent to the SEC or the IRS.

An “other statement” is a financial statement, other than

a tax return or a financial statement described above, filed

with the federal government or any federal agency, a state

Instructions for Form 4626 (2025)

government or state agency, a foreign government or

foreign agency, or a self-regulatory organization including,

for example, a financial statement filed with a state agency

that regulates insurance companies or the Financial

Industry Regulatory Authority, or a comparable foreign

self-regulatory organization.

If none of the above financial statements exist, the AFS

can be an unaudited external statement. An unaudited

external statement is a financial statement, other than a

tax return or a financial statement described above, that is

unaudited (or audited but not certified within the meaning

of Proposed Regulations section 1.56A-2(d)), prepared for

an external non-tax purpose, using (i) GAAP; (ii) IFRS; or

(iii) any other accepted accounting standards that are

issued by an accounting standards board charged with

developing accounting standards for one or more

jurisdictions. If an unaudited external statement also does

not exist, the AFS for a CAMT entity that is not a controlled

foreign corporation (CFC) can be a federal income tax

return or information return filed with the IRS, or, for a

CAMT entity that is a CFC, Form 5471, Information Return

of U.S. Persons With Respect to Certain Foreign

Corporations (or any successor form).

Consolidated AFS and separate AFS. If a CAMT

entity’s financial results are reported on an AFS other than

a tax return with one or more other CAMT entities

(consolidated AFS), the consolidated AFS with the

highest priority under Proposed Regulations sections

1.56A-2(c)(1) through (5) is generally the AFS of the

CAMT entity. However, if a CAMT entity’s financial results

are reported on a consolidated AFS and separately

reported on an AFS that is of equal or higher priority to the

consolidated AFS (separate AFS), the CAMT entity’s AFS

is the separate AFS except as provided below. See

Proposed Regulations section 1.56A-2(g)(1).

A member of a tax consolidated group must prioritize a

consolidated AFS that includes other members of its tax

consolidated group over a separate AFS pursuant to

special rules. See Proposed Regulations sections

1.56A-1(c)(2)(i) and 1.56A-2(g)(2)(i) through (iv) for

additional details regarding this exception.

If a CAMT entity is a member of a foreign-parented

multinational group (FPMG) whose common parent

prepares a consolidated AFS (FPMG consolidated AFS)

that includes the CAMT entity, the corporation must use

the FPMG consolidated AFS regardless of whether the

corporation’s financial results also are reported on a

separate AFS. See Proposed Regulations section

1.56A-2(g)(2)(v).

Foreign-parented multinational group (FPMG). To

determine the FPMG and its members, see section 59(k).

Also, see Proposed Regulations section 1.59-3.

FPMG means, for any tax year, two or more entities, if:

1. At least one entity is a domestic corporation and

another is a foreign corporation,

2. Those entities are included in the same applicable

financial statement for that year, and

3. Either the common parent of those entities is a

foreign corporation or the entities are treated as having a

common parent that is a foreign corporation.

5

For this purpose, if a foreign corporation is engaged in

a trade or business within the United States, that trade or

business is treated as a separate domestic corporation

that is wholly owned by the foreign corporation.

Special Rules

AFSI Test

General AFSI Test

For purposes of determining whether a corporation

satisfies the general AFSI test, the following apply. See

section 59(k)(1). Also, see Proposed Regulations section

1.59-2(c)(1).

• A corporation meets the general AFSI test when the

corporation’s average annual AFSI for the prior 3-tax-year

period exceeds $1 billion.

• Solely for purposes of determining whether a

corporation is an applicable corporation, all AFSI of

members of a controlled group treated as a single

employer with the corporation under section 52(a) or (b)

(“controlled group”) is included in the corporation’s AFSI.

• For purposes of determining the AFSI of the corporation

and all members of the controlled group under the general

AFSI test, the AFSI adjustments for financial statement net

operating losses under section 56A(d), partnership

distributive share under section 56A(c)(2)(D)(i), and

covered benefit plans under section 56A(c)(11) do not

apply.

AFSI Test Applicable to Foreign-Parented

Multinational Group (FPMG) (FPMG AFSI Test)

If a corporation is an FPMG member for any tax year, it

meets the FPMG AFSI test if the FPMG $1 billion AFSI

test and the FPMG $100 million AFSI test described

below are satisfied. See section 59(k)(1). Also, see

Proposed Regulations section 1.59-2(c)(2)(i).

FPMG $1 billion AFSI test. A corporation meets the

FPMG $1 billion AFSI test for the tax year prior to the

current tax year if the corporation’s average annual AFSI

for the 3-tax-year period ending with the tax year exceeds

$1 billion.

For purposes of this determination, the AFSI of the

corporation includes the AFSI of all other members of the

FPMG and the AFSI of all members of the controlled

group other than persons that are members of the FPMG.

See section 59(k). Also, see Proposed Regulations

section 1.59-2(c)(2)(ii).

For purposes of calculating the AFSI of a corporation

that is an FPMG member (including the AFSI of other

members of the FPMG and the controlled group for

aggregation purposes) under the FPMG $1 billion AFSI

test, the AFSI adjustments for financial statement net

operating losses under section 56A(d), partnership

distributive share under section 56A(c)(2)(D)(i), pro rata

CFC adjusted net income or loss under section 56A(c)(3),

effectively connected income of foreign corporations

under section 56A(c)(4), and covered benefits plans

under section 56A(c)(11) do not apply.

FPMG $100 million test. A corporation meets the FPMG

$100 million test for the tax year prior to the current tax

6

year if the corporation’s average annual AFSI for the

3-tax-year period ending with the tax year is $100 million

or more. For purposes of this determination, the AFSI of

the corporation includes the AFSI of all members of the

controlled group. See section 59(k)(1). Also, see

Proposed Regulations section 1.59-2(c)(2)(iii).

For purposes of calculating the AFSI of a corporation

that is an FPMG member (including the AFSI of other

members of the controlled group for aggregation

purposes) under the FPMG $100 million test, the AFSI

adjustments for financial statement net operating losses

under section 56A(d), partnership distributive share under

section 56A(c)(2)(D)(i), and covered benefit plans under

section 56A(c)(11) do not apply.

Additional Rules Applicable to the General AFSI

Test and the FPMG AFSI Test

If a corporation has been in existence for less than 3 tax

years of the 3-tax-year period, the AFSI test is applied by

averaging the tax years of the 3-tax-year period during

which the corporation existed. AFSI for any tax year of

fewer than 12 months shall be annualized by multiplying

the AFSI for the short period by 12 and dividing the result

by the number of months in the short period. See section

59(k)(1)(E). Also, see Proposed Regulations section

1.59-2(d).

Simplified Methods for Determining Applicable

Corporation Status

Section 3.03 of Notice 2025-27 and Proposed

Regulations section 1.59-2(g)(2) provide optional

simplified methods to determine applicable corporation

status in lieu of the AFSI test.

Simplified method for determining applicable corporation status using Notice 2025-27. Generally, if the

corporation’s average annual AFSI for the three preceding

tax years is less than $800 million and it was not an

applicable corporation in a prior year, then it is not an

applicable corporation in the current year and is not

required to file Form 4626.

Corporations can use the Interim Simplified Method

(Safe Harbor) Calculation Worksheet to determine

whether the corporation meets the safe harbor or is

required to file Form 4626.

Under the interim simplified method, a corporation

determines whether it is an applicable corporation by

applying the AFSI test with the following modifications.

• The general AFSI test and the FPMG $1 billion AFSI

test are applied by substituting “$800 million” for “$1

billion.”

• The FPMG $100 million AFSI test is applied by

substituting “$80 million” for “$100 million.”

AFSI is determined by considering only the following

adjustments.

• If the financial results of a CAMT entity are reported on

the same consolidated financial statement for a group of

CAMT entities (AFS Group), the members of the group

that are part of a test group are treated as a single CAMT

entity.

Instructions for Form 4626 (2025)

• Disregard federal income taxes, or income, war profits,

and excess profits taxes (within the meaning of section

901), with respect to a foreign country or U.S. territory

which are taken into account on the corporation’s AFS.

See section 56A(c)(5).

• For an organization subject to tax under section 511,

AFSI only takes into account the AFSI (if any) of an

unrelated trade or business (as defined in section 513) of

such organization, subject to the modifications to

unrelated business taxable income described in section

512(b). This adjustment includes any unrelated

debt-financed income determined under section 514. See

section 56A(c)(12).

• Disregard amounts received from the transfer of an

eligible credit (as defined in section 6418(f)(1)(A)) that is

not includible in gross income or treated as tax exempt,

provided the amount is not otherwise disregarded under

section 56A(c)(5). See Notice 2025-27, section 3.03(2)(b)

(i).

• Disregard amounts received due to an election under

section 48D(d)(2) or 6417(c) that is treated as tax exempt

income under section 48D(d)(2)(A)(i)(III) or 6417(c)(1)(C),

provided the amount is not otherwise disregarded under

section 56A(c)(5). See Notice 2025-27, section 3.03(2)(b)

(ii).

• Disregard amounts paid by the transferee taxpayer (as

defined in section 6418(a)) as consideration for the

transfer of the eligible tax credit, provided the amount is

not otherwise disregarded under section 56A(c)(5). See

Notice 2025-27, section 3.03(2)(b)(iii).

• Disregard any increase in the transferee taxpayer’s net

income or loss on the AFS resulting from the use of the tax

credit, provided the increase is not otherwise disregarded

under section 56A(c)(5). See Notice 2025-27, section

3.03(2)(b)(iv).

• In applying the FPMG $100 million test, a foreign

corporation’s AFSI is calculated by considering only the

income items that are effectively connected with the

conduct of a U.S. trade or business. See section 56A(c)

(4).

• If a corporation has an AFS covering a period (AFS

year) different from its tax year, the general AFSI test and

the FPMG AFSI test are applied using the 3-AFS-year

period ending during such tax year rather than the

3-tax-year period ending with such tax year. See Notice

2025-27, section 3.03(3).

The rules for new corporations and short years are

applied using AFS years rather than tax years. See Notice

2025-27, section 3.03(3)(b).

Simplified method for determining applicable corporation status using the proposed regulations.

Proposed Regulations section 1.59-2(g)(2) provides that a

corporation may choose to apply the safe harbor method

(simplified method) in lieu of the AFSI Test for purposes of

determining whether it is an applicable corporation. Under

the simplified method, a corporation determines whether it

is an applicable corporation by applying the AFSI test with

the following modifications.

The general AFSI test and the FPMG $1 billion AFSI

test are applied by substituting “$500 million” for “$1

billion.”

Instructions for Form 4626 (2025)

The FPMG, $100 million AFSI test is applied by

substituting “$50 million” for “$100 million.”

AFSI is determined by considering only the following

adjustments.

If the financial results of a CAMT entity are reported on

the same consolidated financial statement for a group of

CAMT entities (AFS Group), the members of the group

that are part of a test group are treated as a single CAMT

entity.

Disregard federal income taxes, or income, war profits,

and excess profits taxes (within the meaning of section

901), with respect to a foreign country or U.S. territory

which are taken into account on the corporation’s AFS.

See Proposed Regulations section 1.59-2(g)(2)(iii)(B).

For an organization subject to tax under section 511,

AFSI only takes into account the AFSI (if any) of an

unrelated trade or business (as defined in section 513) of

such organization, subject to the modifications to

unrelated business taxable income described in section

512(b). This adjustment includes any unrelated

debt-financed income determined under section 514. See

Proposed Regulations section 1.59-2(g)(2)(iii)(B).

• In applying the FPMG $100 million test, a foreign

corporation’s AFSI is calculated by considering only the

income items that are effectively connected with the

conduct of a U.S. trade or business. See Proposed

Regulations section 1.59-2(g)(2)(iii)(B).

• If a corporation has an AFS covering a period (AFS

year) different from its tax year, the general AFSI test and

the FPMG AFSI test are applied using the 3-AFS-year

period ending during such tax year rather than the

3-tax-year period ending with such tax year. See

Proposed Regulations section 1.59-2(g)(2)(iv)(A).

The rules for new corporations and short years are

applied using AFS years rather than tax years. See

Proposed Regulations section 1.59-2(g)(2)(iv)(B).

Calculating CAMT

For the tax year of an applicable corporation, a CAMT

liability arises to the extent the tentative minimum tax for

the year exceeds the sum of the regular income tax

imposed for the tax year plus the base erosion minimum

tax (imposed under section 59A). The tentative minimum

tax is the excess of 15% of AFSI over the corporate

alternative minimum tax foreign tax credit (CAMT FTC).

For any corporation that is not an applicable corporation,

the tentative minimum tax for the tax year is zero.

Reduction for financial statement net operating loss

(FSNOL). In calculating CAMT, AFSI is reduced by the

lesser of:

1. The aggregate amount of FSNOL carryovers to the

tax year, or

2. 80% of AFSI computed without regard to the

FSNOL reduction allowed.

An FSNOL for any tax year is the amount of the net loss

(if any) on the corporation’s AFS determined with regard to

AFSI general adjustments under section 56A(c), but

without regard to an FSNOL reduction under section

56A(d), for tax years ending after 2019. An FSNOL for any

tax year is an FSNOL carryover to the tax year following

7

the tax year of the loss. The portion of such loss that is

carried to subsequent years is determined by subtracting

from the loss, for each preceding tax year, the lesser of

the amount of the loss or 80% of AFSI for the tax year

(determined without regard to the FSNOL adjustment),

regardless of whether the corporation was an applicable

corporation in any tax year. See Proposed Regulations

section 1.56A-23 for more details.

Note: For purposes of determining the average annual

AFSI of the corporation and all members of the test group

under the General AFSI Test, the reduction for financial

statement net operating losses does not apply.

Corporate alternative minimum tax foreign tax credit

(CAMT FTC). If an applicable corporation elects to take a

section 901 foreign tax credit for regular tax for a tax year,

the CAMT FTC is an amount equal to the sum of:

1. The lesser of:

a. The aggregate of the applicable corporation’s

pro-rata share (as determined under section 56A(c)(3)) of

income, war profits, and excess profits taxes (within the

meaning of section 901) imposed by any foreign country

or U.S. territory that are taken into account on the AFS of

each CFC with respect to which the applicable corporation

is a U.S. shareholder and are paid or accrued (for federal

income tax purposes) by each CFC, or

b. The applicable corporation’s pro-rata share

(determined under rules similar to the rules under section

951(a)(2)) of the adjusted net income or loss of CFCs,

multiplied by 15%; plus

2. For an applicable corporation that is a domestic

corporation, the income, war profits, and excess profits

taxes (within the meaning of section 901) imposed by any

foreign country or U.S. territory to the extent that such

taxes are taken into account on the applicable

corporation’s AFS and are paid or accrued (for federal

income tax purposes) by the applicable corporation.

Proposed Regulations section 1.56A-8(d)(1) describes

when a foreign tax is treated as taken into account.

Proposed Regulations section 1.59-4(d) provides rules for

determining an applicable corporation’s pro-rata share of

CFC taxes. Proposed Regulations section 1.59-4(g)

describes the treatment of partnership taxes.

Credit for Prior Year Minimum Tax

A corporation may take a credit against the regular tax and

the base erosion minimum tax for alternative minimum tax

incurred in prior years. See Form 8827, Credit for Prior

Year Minimum Tax—Corporations, for details.

Specific Instructions

Item A

If the corporation is a member of a controlled group, check

the “Yes” box in Item A. Also, complete Part V. See the

instructions for Part V.

Item B

If the corporation is a member of an FPMG, check the

“Yes” box. Also, complete Part V. See the instructions for

Part V. In addition, attach a statement described under

8

Proposed Regulations section 1.59-3(g)(4) disclosing the

applicable financial accounting standard used to

determine if a corporation is a member of an FPMG. See

Proposed Regulations section 1.59-3(g) for determining

the applicable financial accounting standard.

Item C

If the corporation has already determined it is an

applicable corporation for purposes of the CAMT, check

the “Yes” box, skip Part I, and continue to Part II.

Otherwise, check the “No” box and complete Part I to

determine if the corporation is an applicable corporation.

Part I—Applicable Corporation

Determination

An applicable corporation is any corporation that satisfies

the AFSI Test for 1 or more tax years prior to the current

tax year and ends after December 31, 2021. If the

corporation is an FPMG member for any tax year, the

FPMG AFSI test applies. See section 59(k) and AFSI Test,

earlier.

A corporation may choose to apply a safe harbor

method (interim simplified method or simplified method) in

lieu of the AFSI Test for purposes of determining whether

it is an applicable corporation. See the instructions for

Form 1120, Schedule K, question 29c, or the applicable

question on the corporation’s return.

If a corporation has been in existence for fewer than 3

tax years of the 3-tax-year period, the AFSI test is applied

to that corporation by averaging the tax years of the

3-tax-year period during which that corporation existed.

For example, a corporation with a calendar tax year is

formed on January 1, 2023. Only the calendar tax years

ended December 31, 2023, and December 31, 2024, are

included in the AFSI test in determining whether the

corporation is an applicable corporation for the tax year

ended December 31, 2025.

For a corporation with AFSI for any tax year of less than

12 months included in the 3-tax-year period, the AFSI of

that corporation is annualized by multiplying the AFSI for

the short period by 12 and dividing the result by the

number of months in the short period. For example, a

corporation with a calendar tax year is formed on July 1,

2022. The AFSI for the tax year ended December 31,

2022, is multiplied by 12 and then divided by 6 when

computing the 3-year annual average AFSI on the

applicable line. The resulting 3-year annual average AFSI

with the AFSI for tax years ended December 31, 2023,

and December 31, 2024, is used to determine whether the

corporation is an applicable corporation for the tax year

ended December 31, 2025.

AFSI for the short period to be annualized does not

include those items described as extraordinary items in

Regulations section 1.6655-2(f)(3)(ii)(A) to the extent that

the items are not otherwise disregarded in determining

AFSI, either because of an AFSI adjustment or because

the items are not included in FSI. However, the items are

included in AFSI for the annualized 12-month period after

the AFSI for the short period is annualized. See Proposed

Regulations section 1.59-2(d)(2)(ii).

Instructions for Form 4626 (2025)

Note: If it has been determined in either the current or

prior tax years that the corporation is an applicable

corporation, skip Part I and continue to Part II.

Columns a, b, and c. In columns (a), (b), and (c), enter

the required information for the 3-tax-year period ending

prior to the current tax year. For example, when a

corporation with a calendar tax year determines whether it

is an applicable corporation for the tax year ending

December 31, 2025, the 3-tax-year period includes the tax

years ended December 31, 2024, December 31, 2023,

and December 31, 2022.

Line 1a. Enter the net income or loss from the

corporation’s AFS. If the corporation’s AFS is a

consolidated AFS, enter the consolidated net income or

loss which includes net income or loss attributable to

noncontrolling interests. If the corporation has been in

existence for less than 3 tax years of the 3-tax-year

period, enter information for the period during which the

corporation existed.

Line 1b. Enter the net income or loss of the other entities

the AFSI of which is required to be aggregated with the

AFSI of the corporation for purposes of determining if the

corporation is an applicable corporation but that are not

included in the corporation’s AFS. Include net income or

loss of members of the controlled group and

corporate-owned disregarded entities that were not

included in the corporation’s AFS, and if the corporation is

an FPMG member, also include the net income or loss of

FPMG members that were not included already. If the

other entity has been in existence for less than 3 tax

years, enter information for the period during which the

corporation existed.

Line 1c. Enter net income or loss from entities included in

the AFS but that are not in the controlled group, or in the

case of an FPMG member, not in the FPMG or controlled

group. Add net loss and subtract net income.

Line 1d. Enter any consolidation entry adjustments made

attributable to entities the net income of which is included

on line 1a (but only to the extent such adjustments were

not reflected on line 1c). See Proposed Regulations

sections 1.56A-1(c)(2) and (3) and 1.1502-56A(a)(2) and

(c) for details.

Line 1e. Reserved for future use.

Lines 2a through 2z. Compute the adjustments for each

of the entities in the aggregation group and report the total

amount for all entities on the form.

Line 2a. Appropriate adjustments to AFSI are made

when the AFS reporting year covers a period other than

the corporation’s tax year.

Line 2b. In the case of any corporation which is not

included on a consolidated return with the taxpayer

corporation, enter the adjustment required by section

56A(c)(2)(C) with respect to each entity in the aggregation

group.

Line 2c. Aggregate pro-rata share of adjusted net income

or loss of CFCs.

Corporation that is not a member of an FPMG. For

a corporation that is not a member of an FPMG, if the

corporation is a U.S. shareholder of one or more CFCs,

Instructions for Form 4626 (2025)

enter the corporation’s aggregate pro-rata share

(determined under rules similar to the rules under section

951(a)(2)) of the adjusted net income or loss of its CFCs

for the first, second, and third preceding years from Form

4626, Schedule A, column (i), line 31. See section 56A(c)

(3)(A). If the aggregate pro-rata share of the adjusted net

income or loss of the corporation’s CFCs is negative, enter

zero.

Attach Schedule A (Form 4626), Pro-Rata Share of

Adjusted Net Income or Loss of CFCs Described in

Section 56A(c)(3). Attach a separate Schedule A for each

of column (a), (b), and (c).

Corporation that is a member of an FPMG. If the

corporation is a member of an FPMG, enter zero.

Line 2d. Income or loss that is not effectively connected

to a U.S. trade or business.

Corporation that is not a member of an FPMG.

Enter the AFSI income or loss from all foreign corporations

that are in the controlled group where such AFSI income

or loss is not effectively connected with the conduct of a

U.S. trade or business. Enter AFSI income as a positive

number and AFSI losses as a negative number.

Corporation that is a member of an FPMG. If the

corporation is a member of an FPMG, enter zero.

Line 2e. Certain taxes. Enter an adjustment to AFSI to

disregard the amount of federal income taxes, and

income, war profits, and excess profits taxes (within the

meaning of section 901), with respect to any foreign

country or U.S. territory which are taken into account on

the corporation’s AFS.

Line 2f. For section 1381 cooperatives, enter an

adjustment to reduce AFSI by the amounts referred to in

section 1382(b) relating to patronage dividends and

per-unit retain allocations to the extent such amounts were

not otherwise taken into account in determining AFSI.

Line 2g. Alaska native corporations. Enter an

adjustment to allow cost recovery and depletion

attributable to property with a basis determined by the

Alaska Native Claims Settlement Act (the Act) and

deductions for amounts payable under section 7(i) or 7(j)

of the Act which are allowed for federal income tax

purposes.

Line 2h. Certain credits. Enter an adjustment to

disregard any amounts treated as federal income tax

credits under section 48D(d) or section 6417 or certain

amounts received from the transfer of an eligible credit, as

defined in section 6418(f)(1)(A), to the extent that these

amounts were not otherwise taken into account on line 2e.

Line 2i. Mortgage servicing income. Enter any

adjustments to defer items of income in connection with

mortgage servicing contracts so that they are not included

in AFSI prior to being included in income for federal

income tax purposes.

Line 2j. Tax-exempt entities. Enter adjustments to AFSI

so that only items from the corporation’s unrelated trade or

business activities (as defined in section 513), subject to

the modifications to unrelated business taxable income

described in section 512(b), are included in AFSI. The

adjustments to AFSI include any unrelated debt-financed

income determined under section 514.

9

Line 2k. Depreciation. Enter an adjustment which is the

difference between the section 167 depreciation

deductions on section 168 property allowed in calculating

taxable income for the tax year and the book expense,

depreciation expense, or other cost recovery expense

included in the CAMT entity’s AFS for such property. The

adjustment is negative if the section 167 depreciation

deductions on section 168 property exceed the book

expense, depreciation expense, or other cost recovery

expense included in the CAMT entity’s AFS for such

property. The adjustment is positive if the book expense,

depreciation expense, or other cost recovery expense

included in the CAMT entity’s AFS for section 168

property exceeds the section 167 depreciation deductions

on such property. Also, enter any additional adjustments,

including those to account for the disposition of property.

See Interim Guidance, earlier.

Line 2l. Qualified wireless spectrum. Enter an

adjustment which is the difference between the qualified

wireless spectrum section 197 amortization allowed in

calculating taxable income for the tax year and the book

expense, amortization expense, or other cost recovery

expense included in the CAMT entity’s AFS for such

property. The adjustment is negative if the section 197

amortization deductions on qualified wireless spectrum

exceed the related book expense, amortization expense,

or other cost recovery expense included in the CAMT

entity’s AFS for such property. The adjustment is positive if

the book expense, amortization expense, or other cost

recovery expense included in the CAMT entity’s AFS for

qualified wireless spectrum property exceeds the section

197 amortization deductions on such property. Also, enter

any additional adjustments, including those to account for

the disposition of property. See Interim Guidance, earlier.

Line 2m. Covered transactions. If the corporation is

relying on interim guidance regarding covered

transactions, enter any AFSI adjustments that result from

the application of such guidance.

Line 2n. Adjustments related to bankruptcy and insolvency. If the corporation is relying on interim guidance

regarding bankrupt or insolvent corporations, enter any

AFSI adjustments that result from the application of such

guidance.

Line 2o. Certain insurance company adjustments. If

the corporation is relying on interim guidance regarding

certain insurance company adjustments and other

industry-specific adjustments, enter any AFSI adjustments

that result from the application of such guidance.

Lines 2p through 2s. Reserved for future use.

Line 2z. Other. Enter any other AFSI adjustments,

including adjustments to prevent omissions or

duplications of any items, as permitted by interim

guidance. Use line 2z to enter adjustments related to

income of foreign governments. Attach a statement

describing the adjustment and amount. If the corporation

is relying on interim guidance regarding certain hedging

transactions or items measured at fair value, enter any

AFSI adjustments that result from the application of such

guidance.

Line 3. Reserved for future use.

10

Line 7. 3-year average annual AFSI. Calculate the

3-year average annual AFSI by dividing the amount on

line 6 by the number of tax years included on line 6. The

average is calculated using the period during which the

corporation existed. However, if the amount on line 6

includes AFSI for any tax year of less than 12 months,

annualize the amount for each short period by multiplying

the short-period AFSI shown on line 5 by 12 and dividing

the result by the number of months in the short period.

Then add the other amounts on line 5 to the annualized

amount and divide that total by the number of tax years of

the 3-tax-year period during which the corporation existed.

Line 8. If line 7 exceeds $1 billion, check the “Yes” box on

line 8, and continue to line 9. If line 7 is $1 billion or less,

check “No.” Stop here. Attach the completed Form 4626 to

the corporation’s income tax return for the current tax year.

Line 9. If the corporation is a member of an FPMG, check

“Yes,” and continue to line 10. If the corporation is not an

FPMG member, check “No,” and continue to Part II.

Line 10a. Enter the amount of AFSI from line 5.

Line 10b. Enter the AFSI amount of FPMG members that

are not members of the corporation’s controlled group.

Line 10c. Subtract line 10b from line 10a. Enter that

amount on line 10c.

Line 11a. Enter the AFSI income or loss of members of

the controlled group that is not effectively connected with

the conduct of a U.S. trade or business. Enter AFSI

income as a negative number and AFSI losses as a

positive number.

Line 11b. If the corporation is a U.S. shareholder of one

or more CFCs, enter the U.S. shareholder corporation’s

pro-rata share (determined under rules similar to the rules

under section 951(a)(2)) of the adjusted net income or

loss of its CFCs for the first, second, and third preceding

years from Form 4626, Schedule A, column (i), line 31. If

the pro-rata share of adjusted net income or loss of the

CFCs is negative, enter zero. See Schedule A.

Attach Schedule A (Form 4626), Pro-Rata Share of

Adjusted Net Income or Loss of CFCs Described in

Section 56A(c)(3). Attach a separate Schedule A for each

of column (a), (b), and (c).

Lines 11c and 11d. Reserved for future use.

Line 13. Combine lines 10c and 12. Enter the total on

line 13.

Line 15. 3-year average annual AFSI for purposes of

the $100 million test. Calculate the 3-year average

annual AFSI by dividing the amount on line 14 by the

number of tax years of the 3-tax-year period during which

the corporation existed. However, if the amount on line 14

includes AFSI for any tax year of less than 12 months,

annualize the amount for each short period by multiplying

the short-period AFSI shown on line 13 by 12 and dividing

the result by the number of months in the short period.

Then add the other amounts on line 13 to the annualized

amount and divide that total by the number of tax years of

the 3-tax-year period during which the corporation existed.

Line 16. If Part I, line 15 is $100 million or more, check

“Yes,” and continue to Part II. If line 15 is less than $100

Instructions for Form 4626 (2025)

million, check “No.” Attach the completed Form 4626 to

the corporation’s income tax return for the current tax year.

Note: If the corporation does not meet the definition of

applicable corporation in Part I or has not been classified

as an applicable corporation in a prior year, do not

complete Part II of Form 4626.

Part II—Corporate Alternative

Minimum Tax (CAMT)

CAMT applies if the tentative minimum tax for the tax year

exceeds the sum of the regular income tax plus the base

erosion minimum tax. The tentative minimum tax for the

tax year is the excess of 15% of AFSI for the tax year, over

the CAMT FTC for the tax year.

Line 1a. If the corporation’s AFS is a consolidated AFS,

enter consolidated net income or loss set forth on the

consolidated AFS for the current tax year, which includes

net income or loss attributable to noncontrolling interests.

Otherwise, enter the net income or loss set forth on the

corporation’s AFS for the current tax year.

Line 1b. Enter the net income or loss of other includible

entities not included in the corporation’s AFS. For

example, include net income or loss reported on the

corporation’s AFS as discontinued operations for any

entity that is a member of the affiliated group of

corporations filing a consolidated tax return. Add net

income and subtract net loss.

Line 1c. Enter the net income or loss of excludible

entities (including corporations that are not part of the

affiliated group of corporations filing a consolidated tax

return with the applicable corporation) included in the

corporation’s AFS. Add net loss and subtract net income.

Line 1d. Enter any consolidation entry adjustments made

attributable to entities the net income of which is included

on line 1a (but only to the extent such adjustments were

not reflected on line 1c). See Interim Guidance, earlier.

Line 1e. Reserved for future use.

Line 2a. Financial statements covering different tax

years. Appropriate adjustments to AFSI are made when

the AFS reporting year covers a period other than the

corporation’s tax year.

Line 2b. Reserved for future use.

Line 2c. Corporations not included on the taxpayer’s

consolidated return. In the case of any corporation

which is not included on a consolidated return with the

taxpayer corporation, enter the adjustment required by

section 56A(c)(2)(C) with respect to such corporation.

Also, enter any adjustments of a U.S. shareholder of a

CFC resulting from certain distributions received with

respect to stock of the CFC. See Interim Guidance, earlier.

Line 2d. Enter the adjustment(s) needed to include the

corporation’s distributive share of all partnership

investment AFSI. For more information, see section

56A(c)(2)(D), Proposed Regulations sections 1.56A-5 and

1.56A-20, and Notice 2025-28.

Line 2e. If the corporation is a U.S. shareholder of one or

more CFCs, enter the corporation’s aggregate pro-rata

share (determined under rules similar to the rules under

Instructions for Form 4626 (2025)

section 951(a)(2)) of the adjusted net income or loss of its

CFCs. If the aggregate pro-rata share of the adjusted net

income or loss of its CFCs is negative, enter zero.

Note: Line 2e should equal Part IV, Section I, line 3f, and

Part VI, Section II, line 3.

Line 2f. In the case of an applicable corporation that is a

foreign corporation, enter any AFSI income or loss

included on the corporation’s AFS that is not effectively

connected with the conduct of a U.S. trade or business.

Enter AFSI income as a negative number and AFSI losses

as a positive number.

Line 2h. For section 1381 cooperatives, enter an

adjustment to reduce AFSI by the amounts referred to in

section 1382(b) (relating to patronage dividends and

per-unit retain allocations) to the extent such amounts

were not otherwise taken into account in determining

AFSI.

Line 2i. Alaska native corporations. Enter an

adjustment to allow cost recovery and depletion

attributable to property with a basis determined by the

Alaska Native Claims Settlement Act (the Act) and

deductions for amounts payable under section 7(i) or 7(j)

of the Act which are allowed for federal income tax

purposes.

Line 2j. Certain credits. Enter an adjustment to

disregard any amounts treated as federal income tax

credits under section 48D(d) or section 6417 or certain

amounts received from the transfer of an eligible credit, as

defined in section 6418(f)(1)(A), to the extent that these

amounts were not taken into account on line 2g.

Line 2k. Mortgage servicing income. Enter any

adjustments to defer items of income in connection with

mortgage servicing contracts so that they are not included

in AFSI prior to being included in income for federal

income tax purposes.

Line 2l. Covered benefit plans. Enter adjustments

needed to AFSI to disregard any income, cost, or expense

that would otherwise be included on the AFS in

connection with any covered benefit plan. Enter

adjustments required to increase AFSI by any covered

benefit plan income and to reduce AFSI by any covered

benefit plan deductions, as allowed under the applicable

provision of the Internal Revenue Code. See sections

56A(c)(11)(A)(i)–(iii).

Line 2m. Tax-exempt entities. Enter adjustments to

AFSI so that only items from the corporation’s unrelated

trade or business activities (as defined in section 513),

subject to the modifications to unrelated business taxable

income described in section 512(b), are included in AFSI.

The adjustments to AFSI include any unrelated

debt-financed income determined under section 514.

Line 2n. Depreciation. Enter an adjustment which is the

difference between the section 167 depreciation

deductions on section 168 property allowed in calculating

taxable income for the tax year and the book expense,

depreciation expense, or other cost recovery expense

included in the CAMT entity’s AFS for such property. The

adjustment is negative if the section 167 depreciation

deductions on section 168 property exceed the book

11

expense, depreciation expense, or other cost recovery

expense included in the CAMT entity’s AFS for such

property. The adjustment is positive if the book expense,

depreciation expense, or other cost recovery expense

included in the CAMT entity’s AFS for section 168

property exceeds the section 167 depreciation deductions

on such property. Also, enter any additional adjustments,

including those to account for the disposition of property.

See Interim Guidance, earlier.

Line 2o. Qualified wireless spectrum. Enter an

adjustment which is the difference between the qualified

wireless spectrum section 197 amortization allowed in

calculating taxable income for the tax year and the book

expense, amortization expense, or other cost recovery

expense included in the CAMT entity’s AFS for such

property. The adjustment is negative if the section 197

amortization deductions on qualified wireless spectrum

exceed the related book expense, amortization expense,

or other cost recovery expense included in the CAMT

entity’s AFS for such property. The adjustment is positive if

the book expense, amortization expense, or other cost

recovery expense included in the CAMT entity’s AFS for

qualified wireless spectrum property exceeds the section

197 amortization deductions on such property. Also, enter

any additional adjustments, including those to account for

the disposition of property. See Interim Guidance, earlier.

Line 2p. Covered transactions. If the corporation is

relying on interim guidance regarding covered

transactions, enter any AFSI adjustments that result from

the application of such guidance.

Line 2q. Adjustments related to bankruptcy and insolvency. If the corporation is relying on interim guidance

regarding bankrupt or insolvent corporations, enter any

AFSI adjustments that result from the application of such

guidance.

Line 2r. Certain insurance company adjustments. If

the corporation is relying on interim guidance regarding

certain insurance company adjustments and other

industry-specific adjustments, enter any AFSI adjustments

that result from the application of such guidance.

Lines 2s through 2u. Reserved for future use.

Line 2z. Other. Enter any other AFSI adjustments,

including adjustments to prevent omissions or

duplications of any items, as permitted by Interim

Guidance. Use line 2z to enter adjustments related to

income of foreign governments. Attach a statement

describing the adjustment and amount. If the corporation

is relying on interim guidance regarding certain hedging

transactions or items measured at fair value, enter any

AFSI adjustments that result from the application of such

guidance.

Line 5. The amount of the FSNOL adjustment for the tax

year is limited to the lesser of:

1. The aggregate amount of FSNOL carryovers to the

tax year, or

2. 80% of AFSI computed without regard to the

FSNOL deduction allowed.

Maintain adequate records documenting both the

amount of FSNOL generated in the tax year and used in

subsequent tax years.

Line 10. Enter the corporation’s regular tax liability (as

defined in section 26(b)) minus any foreign tax credit, if

any (Form 1120, Schedule J, line 1a minus any foreign tax

credit entered on Schedule J, line 5a, or the applicable

lines on the corporation’s tax return).

Line 11. Base erosion minimum tax. Enter the base

erosion minimum tax amount, if any, from Form 1120,

Schedule J, line 1f, or the applicable line of the

corporation’s tax return. See section 59A and Form 8991,

Tax on Base Erosion Payments of Taxpayers with

Substantial Gross Receipts.

Part III—Adjustment for Certain Taxes

Under Section 56A(c)(5)

Federal income taxes, and income, war profits, and

excess profits taxes (within the meaning of section 901)

with respect to any foreign country or U.S. territory which

are taken into account on the corporation’s AFS are

disregarded for AFSI purposes. Complete Part III to adjust

for taxes described in section 56A(c)(5).

Line 1. Enter any income, war profits, and excess profits

taxes (within the meaning of section 901) with respect to

any foreign country or U.S. territory which are taken into

account on the corporation’s AFS in the current income

tax provision. Exclude any CFC income, war profits, and

excess profits taxes (within the meaning of section 901)

with respect to a foreign country or U.S. territory which are

taken into account on the CFC’s AFS in the current

income tax provision.

Line 2. Enter federal income taxes which are taken into

account on the corporation’s AFS in the current income

tax provision.

Line 3. Enter any income, war profits, and excess profits

taxes (within the meaning of section 901) with respect to

any foreign country or U.S. territory which are taken into

account on the corporation’s AFS in the deferred income

tax provision. Exclude any CFC income, war profits, and

excess profits taxes (within the meaning of section 901)

with respect to a foreign country or U.S. territory which are

taken into account on the CFC’s AFS in the deferred

income tax provision.

Line 4. Federal deferred tax provision. Enter federal

income taxes which are taken into account on the

corporation’s AFS in the deferred income tax provision.

Line 5. Enter the federal income taxes and income, war

profits, and excess profits taxes (within the meaning of

section 901) with respect to a foreign country or U.S.

territory taken into account on the corporation’s AFS as

part of equity method investment income. Exclude any

CFC income, war profits, and excess profits taxes (within

the meaning of section 901) with respect to a foreign

country or U.S. territory which are taken into account on

the CFC’s AFS as part of equity method investment

income.

Lines 6a through 6h. Reserved for future use.

12

Instructions for Form 4626 (2025)

Line 6z. Income taxes in other places. Enter other

federal income taxes and income, war profits, and excess

profits taxes (within the meaning of section 901) with

respect to a foreign country or U.S. territory taken into

account on the AFS in determining net income in other

places. Exclude any CFC income, war profits, and excess

profits taxes (within the meaning of section 901) with

respect to a foreign country or U.S. territory which are

taken into account on the CFC’s AFS in determining net

income in other places.

Part IV—Corporate Alternative

Minimum Tax—Foreign Tax Credit

Complete Part IV if an applicable corporation elects to

take the section 901 foreign tax credit for regular tax. See

section 59(l).

A foreign income tax is eligible to be claimed as a

CAMT FTC (eligible tax) in the tax year in which it is paid

or accrued for federal income tax purposes by either an

applicable corporation or a CFC with respect to which the

applicable corporation is a U.S. shareholder, provided the

foreign income tax has been taken into account on the

AFS of such applicable corporation or CFC.

Note: Report all items in Part IV in U.S. dollars.

Section I—CAMT Foreign Tax Credit

Use Section I to compute the total domestic corporation

AMT foreign income taxes.

Line 1a. Enter total foreign taxes paid or accrued as

reported on Form 1118, Schedule B, Part I, column 2(j).

Lines 1b through 1g. Enter the description and amounts

for adjustments to the line 1a amount listed above. On

line 1b, enter any other foreign income taxes not included

on line 1a. Enter any other adjustments to line 1a on lines

1c through 1g.

Line 3a. Pro-rata share of CFC CAMT foreign income

taxes. Enter the amount from Part IV, Section II, line 11,

column (n).

Line 3b. Enter adjustments to the line 3a amount listed

above.

Line 3c. Enter the section 59(l)(2) carryover of excess

foreign taxes from Part IV, Section III, line 4, column (vii).

Line 3e. Enter the 15% specified in section 55(b)(2)(A)(i).

Line 3f. Enter the amount from Part VI, Section II, line 3.

Note: The amount on line 3f should be the same as the

pro-rata share of adjusted net income or loss of a CFC

from Part II, line 2e, and Part VI, Section II, line 3.

Lines 4 and 5. Reserved for future use.

Section II—Allowable CFC CAMT Foreign

Income Taxes

Column (b). Enter the CFC’s employer identification

number (EIN) or other reference identification number.

Column (d). Enter the income, war profits, and excess

profits taxes (within the meaning of section 901) imposed

by a foreign country or U.S. territory which are taken into

account on the CFC’s AFS with respect to which the

applicable corporation is a U.S. shareholder and paid or

accrued (for federal income tax purposes) by the CFC.

See section 59(l)(1).

Columns (e) through (k). Adjustments to column (d).

Enter the description at the top of each adjustment

column. Enter the adjustment amount on each line for

each CFC that may have such adjustment with respect to

the amount included in column (d).

Column (m). Reserved for future use.

Column (n). Enter the corporation’s pro-rata share of the

CFC’s CAMT foreign income taxes.

Section III—CAMT Foreign Tax Credit Carryover

for CFCs

Line 1. Foreign tax carryover from the prior tax year.

If applicable, enter amounts from the appropriate columns

of line 8 of the prior year Form 4626, Part IV, Section III.

Note: For tax years beginning before 2023, the relevant

preceding tax year columns should be left blank.

Lines 2a through 2g. Adjustments to line 1. Enter the

description and amounts of adjustments to the line 1

amount listed above.

Line 5. Complete line 5 only if the applicable corporation

has excess CFC CAMT foreign tax credit limitation.

Excess CFC CAMT foreign tax credit limitation exists

when the applicable corporation’s CFC CAMT foreign tax

credit limitation (Part IV, Section I, line 3f) exceeds its

allowable controlled CFC CAMT foreign income taxes

(Part IV, Section I, line 3a).

Enter in each column the foreign tax carryover utilized

in the current tax year. Starting with column (i), the amount

to be entered on line 5 of a given column will be the

amount on line 4 of that column, but only to the extent that

it does not exceed:

• The amount of excess CFC CAMT foreign tax credit

limitation (defined above), less

• The sum of all amounts entered in all previous columns

of line 5.

The total on line 5, column (vii), cannot exceed the

excess CFC CAMT foreign tax credit limitation.

Line 6. Complete line 6 only regarding the fifth preceding

tax year (and the “Total” column). For the fifth preceding

tax year (column (i)), combine lines 4 and 5 and enter the

result on line 6, column (i).

Line 7. Enter the section 59(l)(2) foreign tax carryover

generated in the current tax year. The line 7, column (vi)

foreign tax carryover generated in the current tax year is

the difference between the allowable CFC CAMT foreign

income taxes (Part IV, Section I, line 3a) and the CFC

CAMT foreign tax credit limitation (Part IV, Section I,

line 3g).

Column (c). Enter the adjusted net income or loss of

each CFC as reported on each CFC’s Form 5471,

Schedule H-1, line 4 in U.S. dollars.

Instructions for Form 4626 (2025)

13

Part V—Members of a Controlled

Group Treated as a Single Employer

and FPMG Members Taken Into

Account in “Applicable Corporation”

Determination

If the corporation answers “Yes” to either Item A or Item B

at the top of page 1, then the corporation must complete

Part V. Enter the requested information for the entities

included in the taxpayer’s applicable corporation

determination.

Note: Incomplete or nonspecific responses, including

phrases such as “available upon request” are not sufficient

responses.

Column (a). Enter the name of the member of a

controlled group and/or FPMG member included in the

corporation’s applicable corporation determination.

Column (b). Enter the EIN of the member of a controlled

group and/or FPMG member included in the corporation’s

applicable corporation determination.

Column (c). Member of a controlled group. Check the

box on the appropriate line if the entity is a member of a

controlled group. See Proposed Regulations section

1.59-2(e)(1) for the definition of a controlled group.

Column (d). Check the box on the appropriate line if the

entity is a member of an FPMG. See section 59(k)(2) and

the AFSI Test section, earlier.

Column (e). Enter the EIN or foreign taxpayer

identification number (FTIN) of the U.S. income tax return

(if any) on which the majority of the member’s income is

reported for the tax year. For this question only, majority

means more than 50% of the member’s financial

statement income.

profits, and excess profits taxes (within the meaning of

section 901) with respect to a foreign country or U.S.

territory taken into account on the CFC’s AFS. See section

56A(c)(5).

Section II—Section 56A(c)(3)(B) Negative

Adjustment

Line 1. In general, enter the amount from Section I,

line 42. However, if the applicable corporation relies on the

specified proposed regulations and does not choose to

have the benefits of subpart A of part III of subchapter N of

chapter 1 for the tax year, then reduce the amount on

Section I, line 42 by the amount of the reduction described

in Proposed Regulations section 1.56A-6(b)(2) and enter

the result here.

Line 2. Enter the aggregate amount of available CFC

adjustment carryovers as defined in Proposed

Regulations section 1.56A-6(b)(6). A CAMT entity that is a

U.S. shareholder of one or more CFCs makes a single

adjustment to the CAMT entity’s AFSI for its tax year that

is equal to the aggregate of the CAMT entity’s pro-rata

share of the adjusted net income or loss of each such

CFC. If a prior tax year aggregate adjustment is negative

with respect to a tax year of a U.S. shareholder, such loss

is carried forward to the future tax years and may reduce

the current tax year aggregate pro-rata share of CFC’s

adjusted net income from the total of Part VI, Section I.

Attach a statement summarizing the amount of CFC

adjustment carryover generated in each prior year, the

amount of each such CFC adjustment carryover that has

been used in prior years, and the amount of such CFC

adjustment carryovers available to be used in the current

year, as illustrated below.

(A) CFC

Adjustment

Carryover

Generated

(B) Amount of

Carryover

From (A)

Used in Prior

Years

(C) Amount of

Carryover

From (A)

Available for

Use

20X1

100x

70x

30x

20X2

0

n/a

n/a

20X3

40x

0

40x

Column (f). Enter each included member’s net income or

loss reported on its AFS for the current tax year.

Part VI—Aggregate Pro-Rata Share of

Adjusted Net Income or Loss of CFCs

Described in Section 56A(c)(3)

Section I—Pro-Rata Share of Adjusted Net

Income or Loss of CFCs Described in Section

56A(c)(3)

Column (a). Enter the name of the CFC.

Column (b). Enter the EIN or reference ID number of the

CFC.

Column (c). Enter the country code for the country in

which the CFC was incorporated. See IRS.gov/

CountryCodes.

Column (d). Enter the pro-rata share of items taken into

account in computing the adjusted net income or loss of a

CFC as reported on each CFC’s Schedule H-1 (Form

5471) in U.S. dollars. See section 56A(c)(3). In

determining the adjusted net income or loss of a CFC,

disregard CFC federal income taxes, and income, war

14

Note: The amount entered on Line 2 should equal the

sum of the amounts reported in column (C) above.

Line 3. Combine lines 1 and 2. If more than zero, enter

the total on line 3 and on Part II, line 2e, and Part IV,

Section I, line 3f. If zero or less, enter zero (-0-) on line 3

and on Part II, line 2e, and Part IV, Section I, line 3f, and go

to line 4.

Line 4. Combine lines 1 and 2. If less than zero, enter

the combined total as a negative number. If zero or more,

enter -0-.

Instructions for Form 4626 (2025)

Schedule A—Pro-Rata Share of

Adjusted Net Income or Loss of CFCs

Described in Section 56A(c)(3)

Note: Complete a separate Schedule A for each of the 3

preceding tax years.

Column (a). Enter the name of the CFC.

Column (b). Enter the EIN or reference ID number of the

CFC.

Column (c). Enter the country code for the country in

which the CFC was incorporated. See IRS.gov/

CountryCodes.

Column (d). Enter the CFC’s current-year net income or

(loss) in U.S. dollars for the relevant tax year.

Column (e). Enter the section 56A(c)(3) adjustments in

U.S. dollars for the relevant tax year.

Column (f). Combine column (d) and column (e).

Columns (g) and (h). Reserved for future use.

Column (i). Enter the pro-rata share of the adjusted net

income or loss of the CFC described in section 56A(c)(3)

in U.S. dollars.

Reduce the amount reported on line 31 by the CFC

adjustment carryovers available for the relevant year, if

any. Enter the reduced amount in the appropriate column

of Part I, line 2c or, if a member of an FPMG, the

appropriate column of Part I, line 11b.

Note: When calculating the CFC adjustment carryovers

available for this purpose, the adjustment provided under

Proposed Regulations section 1.56A-6(b)(2) is not taken

Instructions for Form 4626 (2025)

into account. Attach a statement similar to the example

shown for Part VI, Section II, line 2 that summarizes the

amount of CFC adjustment carryover generated in each

prior year, the amount of each such CFC adjustment

carryover that has been used in prior years, and the

amount of such CFC adjustment carryovers available to

be used in the current year.

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 will vary

depending on individual circumstances. The estimated

burden for business taxpayers filing this form is approved

under OMB control number 1545-0123 and is included in

the estimates shown in the instructions for their business

income tax return.

If you have comments concerning the accuracy of

these time estimates or suggestions for making this form

simpler, we would be happy to hear from you. See the

instructions for the tax return with which this form is filed.

15

Worksheet. Interim Simplified Method (Safe Harbor) Calculation

Interim Simplified Method (Safe Harbor) Calculation Worksheet

Note: If the corporation already determined it is an applicable corporation in current or prior years for purposes of the CAMT, it must prepare Form

4626. Do not complete this worksheet.

(a)

First

Preceding

Year Ended

____/____/

____

1

Consolidated net income or loss per AFS.

2a

Adjustment for certain consolidating entries.

2b

Certain taxes.

2c

Certain credits (only applicable to Notice 2025-27 safe harbor calculation).

2d

Tax-exempt entities (organizations subject to tax under section 511).

2e

Financial statements covering different years.

3

Total adjustments. Combine lines 2a through 2e.

4

AFSI. Combine lines 1 and 3.

5

AFSI of first, second, and third preceding tax years. Combine columns (a), (b), and

(c) of line 4.

6

3-year average annual AFSI.

7

Is line 6 more than $800 million? If “Yes,” continue to line 8. If “No,” STOP here. The

corporation meets the safe harbor and is not required to complete Form 4626.

8

Is the corporation a member of an FPMG within the meaning of section 59(k)(2)(B)? If

“Yes,” continue to line 9. If “No,” the corporation does not meet the safe harbor and is

required to complete Form 4626.

9

AFSI from line 4.

10

Adjustment for income not effectively connected to a U.S. trade or business.

11

Total AFSI for purposes of the $80 million FPMG test. Combine lines 9 and 10.

12

AFSI of first, second, and third preceding tax years. Combine columns (a), (b), and

(c) of line 11.

13

3-year average annual AFSI for purposes of the $80 million FPMG test.

14

Is line 13 $80 million or more? If “Yes,” the corporation does not meet the safe harbor

and is required to complete Form 4626. If “No,” the corporation meets the safe harbor

and is not required to complete Form 4626.

16

(b)

Second

Preceding Year

Ended

____/____/

____

(c)

Third

Preceding Year

Ended

____/____/____

Instructions for Form 4626 (2025)