Instructions for Form 5472

Instructions for Form 5472

(Rev. December 2024)

(Use with December 2023 revision of Form 5472)

Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign

Corporation Engaged in a U.S. Trade or Business

Section references are to the Internal Revenue Code

unless otherwise noted.

Future Developments

For the latest information about developments related to

Form 5472 and its instructions, such as legislation

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

Form5472.

What's New

Definition of foreign person. In the last paragraph of

the definition of foreign person, below, the exception for a

foreign person filing a joint return now refers to specific

Code sections 6013(g) and (h) in accordance with

Regulations section 1.6038A-1(f)(1).

General Instructions

Purpose of Form

Use Form 5472 to provide information required under

sections 6038A and 6038C when reportable transactions

occur during the tax year of a reporting corporation with a

foreign or domestic related party.

Definitions

Reporting corporation. A reporting corporation is either:

• A 25% foreign-owned U.S. corporation (including a

foreign-owned U.S. disregarded entity (DE)), or

• A foreign corporation engaged in a trade or business

within the United States.

25% foreign owned. A corporation is 25% foreign

owned if it has at least one direct or indirect 25% foreign

shareholder at any time during the tax year.

25% foreign shareholder. Generally, a foreign person

(defined later) is a 25% foreign shareholder if the person

owns, directly or indirectly, at least 25% of either:

• The total voting power of all classes of stock entitled to

vote, or

• The total value of all classes of stock of the corporation.

The constructive ownership rules of section 318 apply

with the following modifications to determine if a

corporation is 25% foreign owned. Substitute “10%” for

“50%” in section 318(a)(2)(C). Do not apply sections

318(a)(3)(A), (B), and (C), so as to consider a U.S. person

as owning stock that is owned by a foreign person.

Direct 25% foreign shareholder. A foreign person is

a direct 25% foreign shareholder if it owns directly at least

25% of the stock of the reporting corporation by vote or

value.

Feb 11, 2025

Ultimate indirect 25% foreign shareholder. An

ultimate indirect 25% foreign shareholder is a 25% foreign

shareholder whose ownership of stock of the reporting

corporation is not attributed (under the principles of

sections 958(a)(1) and (2)) to any other 25% foreign

shareholder. See Rev. Proc. 91-55, 1991-2 C.B. 784.

Related party. A related party is:

• Any direct or indirect 25% foreign shareholder of the

reporting corporation,

• Any person who is related (within the meaning of

section 267(b) or 707(b)(1)) to the reporting corporation,

• Any person who is related (within the meaning of

section 267(b) or 707(b)(1)) to a 25% foreign shareholder

of the reporting corporation, or

• Any other person who is related to the reporting

corporation within the meaning of section 482 and the

related regulations.

“Related party” does not include any corporation filing a

consolidated federal income tax return with the reporting

corporation.

The rules in section 318 apply to the definition of

related party with the modifications listed under the

definition of 25% foreign shareholder, earlier.

Reportable transaction. A reportable transaction is:

• Any type of transaction listed in Part IV (for example,

sales, rents, etc.) for which monetary consideration

(including U.S. and foreign currency) was the sole

consideration paid or received during the reporting

corporation’s tax year;

• Any transaction listed in Part V; or

• Any transaction or group of transactions listed in Part

VI.

Transactions with a U.S. related party, however, are not

required to be specifically identified in Parts IV, V, and VI.

Foreign person. A foreign person is:

• An individual who is not a citizen or resident of the

United States;

• An individual who is a citizen or resident of a U.S.

possession who is not otherwise a citizen or resident of

the United States;

• Any partnership, association, company, or corporation

that is not created or organized in the United States;

• Any foreign estate or foreign trust described in section

7701(a)(31); or

• Any foreign government (or agency or instrumentality

thereof) to the extent that the foreign government is

engaged in the conduct of a commercial activity, as

defined in section 892.

However, the term “foreign person” does not include

any individual for whom an election under section 6013(g)

Instructions for Form 5472 (Rev. 12-2024) Catalog Number 59641T

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

or (h) (relating to an election to file a joint return) is in

effect.

See Regulations section 1.6038A-1(f).

Disregarded entity (DE). A DE is an entity 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.

Foreign-owned U.S. DE. A foreign-owned U.S. DE is a

domestic DE that is wholly owned by a foreign person. For

tax years beginning on or after January 1, 2017, and

ending on or after December 13, 2017, a foreign-owned

U.S. DE is treated as an entity separate from its owner and

classified as a corporation for the limited purposes of the

requirements under section 6038A that apply to 25%

foreign-owned domestic corporations. See the final

regulations at IRS.gov/irb/2017-03_IRB#TD-9796.

Who Must File

Generally, a reporting corporation must file Form 5472 if it

had a reportable transaction with a foreign or domestic

related party.

Exceptions from filing. A reporting corporation is not

required to file Form 5472 if any of the following apply.

1. It had no reportable transactions of the types listed

in Parts IV and VI of the form and, in the case of a

reporting corporation that is a foreign-owned U.S. DE, also

had no reportable transactions of the type listed in Part V

of the form.

2. A U.S. person that controls the foreign related

corporation files Form 5471, Information Return of U.S.

Persons With Respect To Certain Foreign Corporations,

for the tax year to report information under section 6038.

To qualify for this exception, the U.S. person must

complete Schedule M (Form 5471) showing all reportable

transactions between the reporting corporation and the

related party for the tax year. This exception does not

apply to foreign-owned U.S. DEs.

3. The related corporation qualifies as a foreign sales

corporation for the tax year and files Form 1120-FSC, U.S.

Income Tax Return of a Foreign Sales Corporation. This

exception does not apply to foreign-owned U.S. DEs.

4. It is a foreign corporation that does not have a

permanent establishment in the United States under an

applicable income tax treaty and timely files Form 8833,

Treaty-Based Return Position Disclosure Under Section

6114 or 7701(b).

5. It is a foreign corporation all of whose gross income

is exempt from taxation under section 883 and it timely

and fully complies with the reporting requirements of

sections 883 and 887.

6. Both the reporting corporation and the related party

are not U.S. persons, as defined in section 7701(a)(30)

and the transactions will not generate in any tax year:

• Gross income from sources within the United States or

income effectively connected, or treated as effectively

connected, with the conduct of a trade or business within

the United States; or

• Any expense, loss, or other deduction that is allocable

or apportionable to such income.

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Note. Exception 6 does not apply to foreign-owned U.S.

DEs.

Consolidated returns. If a reporting corporation is a

member of an affiliated group filing a consolidated income

tax return, Regulations section 1.6038A-2 may be

satisfied by filing a U.S. consolidated Form 5472. The

common parent must attach to Form 5472 a schedule

stating which members of the U.S. affiliated group are

reporting corporations under section 6038A, and which of

those members are joining in the consolidated filing of

Form 5472. The schedule must show the name, address,

and employer identification number (EIN) of each member

who is including transactions on the consolidated Form

5472.

Note. A member is not required to join in filing a

consolidated Form 5472 just because the other members

of the group choose to file one or more Forms 5472 on a

consolidated basis.

When and Where To File

File Form 5472 as an attachment to the reporting

corporation's income tax return by the due date (including

extensions) of that return.

Foreign-owned U.S. DEs. While a foreign-owned U.S.

DE has no income tax return filing requirement, as a result

of final regulations under section 6038A, it will now be

required to file a pro forma Form 1120, U.S. Corporation

Income Tax Return, with Form 5472 attached by the due

date (including extensions) of that Form 1120. The only

information required to be completed on Form 1120 is the

name and address of the foreign-owned U.S. DE and

items B and E on the first page. The foreign-owned U.S.

DE has the same tax year used by its owner for U.S. tax

filing requirements or, if none, the calendar year.

Dedicated mailing address. Foreign-owned U.S. DEs

are required to use the following dedicated mailing

address. These filers do not use the mailing address

provided in the Instructions for Form 1120.

Note. “Foreign-owned U.S. DE” should be written across

the top of the Form 1120. File these forms by:

• Fax (300 DPI or higher) to 855-887-7737, or

• Mail to:

Internal Revenue Service

1973 Rulon White Blvd

M/S 6112 Attn: PIN Unit

Ogden, UT 84201

Foreign-owned U.S. DEs are required to use the

special mailing address, as mentioned earlier.

CAUTION These filers do not use the mailing addresses

provided in the Instructions for Form 1120.

!

Extension of time to file. A foreign-owned U.S. DE

required to file Form 5472 can request an extension of

time to file by filing Form 7004, Application for Automatic

Extension of Time To File Certain Business Income Tax,

Information, and Other Returns. The DE must file Form

7004 by the regular due date of the return. Because the

Form 5472 of a DE must be attached to a pro forma Form

1120, the code for Form 1120 should be entered on Form

Instructions for Form 5472 (Rev. 12-2024)

7004, Part I, line 1. “Foreign-owned U.S. DE” should be

written across the top of Form 7004.

The DE must fax or mail the Form 7004 to the fax

number or mailing address identified earlier, by the due

date (excluding extensions) of the return. For these

entities, do not use the regular filing address listed in the

Instructions for Form 7004.

For further general information, see the Instructions for

Form 7004.

Electronic Filing of Form 5472

If you file your income tax return electronically, see the

instructions for your income tax return for general

information about electronic filing.

If you are a foreign-owned U.S. DE, you cannot file

Form 5472 electronically. See Foreign-owned U.S.

CAUTION DEs under When and Where To File, earlier, for

acceptable methods of filing.

!

Accrued Payments and Receipts

A reporting corporation that uses an accrual method of

accounting must use accrued payments and accrued

receipts for purposes of computing the total amount to

enter on each line of Form 5472. See Regulations section

1.6038A-2(b)(10).

Penalties

Penalties for failure to file Form 5472. A penalty of

$25,000 will be assessed on any reporting corporation

that fails to file Form 5472 when due and in the manner

prescribed. The penalty also applies for failure to maintain

records as required by Regulations section 1.6038A-3.

Note. Filing a substantially incomplete Form 5472

constitutes a failure to file Form 5472.

Each member of a group of corporations filing a

consolidated information return is a separate reporting

corporation subject to a separate $25,000 penalty and

each member is jointly and severally liable.

If the failure continues for more than 90 days after

notification by the IRS, an additional penalty of $25,000

will apply. This penalty applies with respect to each

related party for which a failure occurs for each 30-day

period (or part of a 30-day period) during which the failure

continues after the 90-day period ends.

Criminal penalties under sections 7203, 7206, and

7207 may also apply for failure to submit information or for

filing false or fraudulent information.

Record Maintenance Requirements

A reporting corporation must keep the permanent books

of account or records as required by section 6001. These

books must be sufficient to establish the correctness of

the reporting corporation’s federal income tax return,

including information or records that might be relevant to

determine the correct treatment of transactions with

related parties. See Regulations section 1.6038A-3 for

more detailed information. Also, see Regulations sections

1.6038A-1(h) and 1.6038A-1(i) for special rules that apply

to small corporations and reporting corporations with

related party transactions of de minimis value.

Instructions for Form 5472 (Rev. 12-2024)

Specific Instructions

Part I—Reporting Corporation

Line 1a. Address. 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 corporation has

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

Foreign address. 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.

Line 1c. Total assets. Domestic reporting corporations

enter the total assets from Form 1120, page 1, item D.

Foreign reporting corporations enter the amount from

Form 1120-F, U.S. Income Tax Return of a Foreign

Corporation, Schedule L, line 17, column (d).

Lines 1d and 1e. Enter a description of the principal

business activity and enter the principal business activity

code. See the Instructions for Form 1120 or the

Instructions for Form 1120-F for a list of principal business

activities and their associated codes.

Line 1f. Enter the total value in U.S. dollars of all foreign

related party transactions reported in Parts IV and VI (and

if the reporting corporation is a foreign-owned U.S. DE,

Part V) of this Form 5472. This is the total of the amounts

entered on lines 22 and 36 of Part IV plus the fair market

value (FMV) of the nonmonetary and less than full

consideration transactions reported in Part VI. Do not

complete line 1f if the reportable transaction is with a U.S.

related party.

Line 1g. File a separate Form 5472 for each foreign or

U.S. person who is a related party with which the reporting

corporation had a reportable transaction. Enter the total

number of Forms 5472 (including this one) being filed for

the tax year.

Line 1h. Enter the total value in U.S. dollars of all foreign

related party transactions reported in Parts IV and VI (and

if the reporting corporation is a foreign-owned U.S. DE,

Part V) of all Forms 5472 filed for the tax year. This is the

total of the amounts entered on line 1f of all Forms 5472

filed for the tax year (including this one).

Line 1j. Check the box if this is the first year the U.S.

reporting corporation has filed a Form 5472.

Line 1k. Complete Part VIII for each cost sharing

arrangement (CSA) and enter the total number of Parts

VIII attached to Form 5472 on line 1k.

Line 1o. Provide the principal country(ies) where

business is conducted. Do not include any country(ies) in

which business is conducted solely through a subsidiary.

Do not enter “worldwide” instead of listing the

country(ies). These rules also apply to lines 5c, 6c, and 7c

of Part II, and line 8f of Part III.

Line 2. For purposes of this line:

• Foreign person has the same meaning as provided

earlier under Definitions; and

• 50% direct or indirect ownership is determined by

applying the constructive ownership rules of section 318

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with the modifications listed under the definition of 25%

foreign shareholder, earlier.

Line 3. Check this box if you are a foreign-owned U.S.

DE.

Part II—25% Foreign Shareholder

Note. Only 25% foreign-owned U.S. corporations,

including foreign-owned U.S. DEs, complete Part II. For a

foreign-owned U.S. DE, report the information for the

foreign owner on the lines provided for the 25% foreign

shareholder.

The form provides sufficient space to report information

for two direct 25% foreign shareholders and two ultimate

indirect 25% foreign shareholders. If more space is

needed, show the information requested in Part II on an

attached sheet.

Report on lines 4a through 4e information about the

direct 25% foreign shareholder who owns (by vote or

value) the largest percentage of the stock of the U.S.

reporting corporation.

Report on lines 5a through 5e information about the

direct 25% foreign shareholder who owns (by vote or

value) the second largest percentage of the stock of the

U.S. reporting corporation.

Report on lines 6a through 6e information about the

ultimate indirect 25% foreign shareholder who owns (by

vote or value) the largest percentage of the stock of the

U.S. reporting corporation.

Report on lines 7a through 7e information about the

ultimate indirect 25% foreign shareholder who owns (by

vote or value) the second largest percentage of the stock

of the U.S. reporting corporation.

Part II, heading. Check the box if any direct or indirect

25% foreign shareholder identified in Part II is a surrogate

foreign corporation, as defined in section 7874(a)(2)(B)

resulting from an inversion in the current year or in the

previous 10 years.

Lines 4b(1), 5b(1), 6b(1), and 7b(1). For each 25%

foreign shareholder listed in Part II, enter the shareholder's

U.S. identifying number, if any. Individuals should enter a

social security number (SSN), or an individual taxpayer

identification number (ITIN) issued by the IRS. All other

entities should enter an EIN.

Lines 4b(2), 5b(2), 6b(2), and 7b(2). For each 25%

foreign shareholder listed in Part II, enter the shareholder's

reference ID number, if required. A reference ID number is

required only in cases where no U.S. identifying number

was entered for the shareholder on the preceding line

(line 4b(1), 5b(1), 6b(1), or 7b(1), respectively). However,

filers are permitted to enter both an EIN and a reference

ID number. If applicable, enter the reference ID number

(defined later) you have assigned to the 25% foreign

shareholder.

Reference ID number. A reference ID number is a

number established by or on behalf of the reporting

corporation identified in Part I that is assigned to 25%

foreign shareholders and/or related foreign parties with

respect to which Form 5472 reporting is required. These

numbers are used to uniquely identify the 25% foreign

shareholder or related foreign party in order to keep track

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of such foreign person from tax year to tax year. The

reference ID number must meet the requirements set forth

later.

Note. Because reference ID numbers are established by

or on behalf of the reporting corporation filing Form 5472,

there is no need to apply to the IRS to request a reference

ID number or for permission to use these numbers.

Requirements. The reference ID number that is

entered must be alphanumeric (defined later), 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 25% foreign shareholder or related foreign party. If

for any reason a reference ID number falls out of use (for

example, the 25% foreign shareholder or related foreign

party no longer exists due to disposition or liquidation), the

reference ID number used for such foreign person cannot

be used again for another 25% foreign shareholder or

related foreign party for purposes of Form 5472 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 a

25% foreign shareholder or related foreign party.

For example, in the case of a merger or acquisition

involving a 25% foreign shareholder or related foreign

party, a Form 5472 filer must use a reference ID number

that correlates the previous reference ID number with the

new reference ID number assigned to the 25% foreign

shareholder or related foreign party.

In the case of an entity classification election that is

made on behalf of a 25% foreign shareholder or related

foreign party on Form 8832, Regulations section

301.6109-1(b)(2)(v) requires the 25% foreign shareholder

or related foreign party to have an EIN for this election. For

the first tax year that Form 5472 is filed after an entity

classification election is made on behalf of the 25%

foreign shareholder or related foreign party on Form 8832,

the new EIN must be entered in the applicable entry

space in Part II or Part III and the old reference ID number

must be entered in the applicable entry space to the right.

In subsequent years, the Form 5472 filer may continue to

enter both the EIN and the reference ID number, but must

enter at least the EIN.

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 earlier, 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.

Lines 4b(3), 5b(3), 6b(3), and 7b(3). A foreign-owned

U.S. DE must enter a foreign taxpayer identification

Instructions for Form 5472 (Rev. 12-2024)

number (FTIN), if any, for each direct and ultimate foreign

owner listed in Part II. If a foreign-owned U.S. DE has, as a

direct owner, a foreign DE, report that foreign DE as the

direct owner. The FTIN should be used consistently on an

annual basis when filing Form 5472, as an EIN or

reference ID number would be used. If you do not have an

FTIN, enter “None” or “N/A” in the FTIN block. If you have

a U.S. identifying number and/or reference ID number, you

can enter it in the appropriate block, as discussed earlier.

Filers of Form 5472, other than foreign-owned U.S.

DEs, can enter an FTIN on these lines. However, they

must also enter a U.S. identifying number or reference ID

number on lines 4b(1)/7b(1) or 4b(2)/7b(2), respectively. If

you are not a foreign-owned U.S. DE, and do not have an

FTIN, leave the block blank.

Lines 6a–6e and lines 7a–7e. Attach an explanation of

the attribution of ownership. See Rev. Proc. 91-55, and

Regulations section 1.6038A-1(e).

Part III—Related Party

All filers must complete Part III even if the related party

has been identified in Part II as a 25% foreign shareholder.

Report in Part III information about the related party

(domestic or foreign) with which the reporting corporation

had reportable transactions during the tax year.

Line 8b(1). Enter the related party's U.S. identifying

number, if any. For individuals, enter an SSN, or an ITIN

issued by the IRS. For all other entities, enter an EIN.

Line 8b(2). If the related party is a foreign person, enter

the related party's reference ID number, if required. A

reference ID number is required only in cases where no

U.S. identifying number was entered for the foreign related

party on line 8b(1). However, filers are permitted to enter

both an EIN and a reference ID number. If applicable,

enter the reference ID number you have assigned to the

foreign related party. See Reference ID number, earlier, for

more information.

Reasonable estimates. When actual amounts are not

determinable, enter reasonable estimates (discussed

later) of the total dollar amount of each of the categories of

transactions conducted between the reporting corporation

and the related person in which monetary consideration

(U.S. currency or foreign currency) was the sole

consideration paid or received during the tax year of the

reporting corporation.

A reasonable estimate is any amount reported on Form

5472 that is at least 75% but not more than 125% of the

actual amount required to be reported.

Small amounts. If any actual amount in a transaction or

a series of transactions between a foreign related party

and the reporting corporation does not exceed a total of

$50,000, the amount may be reported as “$50,000 or

less.”

Lines 11 and 25. Report on these lines platform

contribution transaction payments received and paid by

the reporting corporation (without giving effect to any

netting of payments due and owed). See Regulations

section 1.482-7(b)(1)(ii).

Note. The term “platform contribution transaction” is not

limited to transactions that occurred on or after January 5,

2009, or transactions that occur according to a CSA that

was not in effect before January 5, 2009. See Regulations

sections 1.482-7(m)(1) and (m)(2)(i).

Lines 12 and 26. Report on these lines cost sharing

transaction payments received and paid by the reporting

corporation (without giving effect to any netting of

payments). See Regulations section 1.482-7(b)(1)(i). The

corporation is required to complete line 12 only if the

corporation itself incurred intangible development costs

(IDCs). If the corporation does not itself incur IDCs, then it

should only report cost sharing transaction payments

made on line 26.

Part IV—Monetary Transactions

Between Reporting Corporations and

Foreign Related Party

Note. The term “cost sharing transaction” is not limited to

transactions that occurred on or after January 5, 2009, or

transactions that occur according to a CSA that was not in

effect before January 5, 2009. See Regulations sections

1.482-7(m)(1) and (m)(2)(i).

Note. Do not complete Part IV for transactions with a

domestic related party.

Line 17. Amounts borrowed. Report amounts borrowed

(including borrowings in place at the beginning of the tax

year) using either the outstanding balance method or the

monthly average method. If the outstanding balance

method is used, enter the beginning and ending

outstanding balances for the tax year on lines 17a and

17b. If the monthly average method is used, skip line 17a

and enter the monthly average for the tax year on line 17b.

When completing Part IV or Part VI, the terms “paid”

and “received” include accrued payments and accrued

receipts.

State all amounts in U.S. dollars and attach a schedule

showing the exchange rates used.

If the related party transactions occur between a

related party and a partnership that is, in whole or in part,

owned by a reporting corporation, the reporting

corporation reports only the percentage of the value of the

transaction(s) equal to the percentage of its partnership

interest. This rule does not apply if the reporting

corporation owns a less-than-25% interest in the

partnership. The rules of attribution apply when

determining the reporting corporation’s percentage of

partnership interest.

Instructions for Form 5472 (Rev. 12-2024)

Line 21. Other amounts received. Enter amounts

received that are not specifically reported on lines 9

through 20. Include amounts on line 21 to the extent that

these amounts are taken into account in determining the

taxable income of the reporting corporation.

Line 31. Amounts loaned. Report amounts loaned

(including loans in place at the beginning of the tax year)

using either the outstanding balance method or the

monthly average method. If the outstanding balance

method is used, enter the beginning and ending

outstanding balances for the tax year on lines 31a and

5

31b. If the monthly average method is used, skip line 31a

and enter the monthly average for the tax year on line 31b.

Line 32. Interest paid. Report the amount of interest

paid or accrued. If the amount of interest paid or accrued

is subject to the limitation of section 163(j), report only the

amount allowed as a deduction under that section. For

more information, see the Instructions for Form 8990,

Limitation on Business Interest Expense Under Section

163(j). Any amounts accrued or paid in excess of the

amount allowed as a deduction under section 163(j) will

be treated as interest paid or accrued in a subsequent

year and are required to be reported on this line in the

year the deferred amount is allowed as a deduction.

Line 35. Other amounts paid. Enter amounts paid that

are not specifically reported on lines 23 through 34.

Include amounts on line 35 to the extent that these

amounts are taken into account in determining the taxable

income of the reporting corporation.

Part V—Reportable Transactions of a

Reporting Corporation That Is a

Foreign-Owned U.S. DE

You must check the box in Part V if you are a

foreign-owned DE that had any other transaction, as

defined by Regulations section 1.482-1(i)(7) not already

entered in Part IV. These transactions include amounts

paid or received in connection with the formation,

dissolution, acquisition, and disposition of the entity,

including contributions to, and distributions from, the

entity. Describe these on an attached statement.

Part VI—Nonmonetary and

Less-Than-Full Consideration

Transactions Between the Reporting

Corporation and the Foreign Related

Party

Note. Do not complete Part VI for transactions with a

domestic related party.

If the related party is a foreign person, the reporting

corporation must attach a schedule describing each

reportable transaction or group of reportable transactions.

The description must include sufficient information so that

the nature and approximate monetary value of the

transaction or group of transactions can be determined.

The schedule should include:

1. A description of all property (including monetary

consideration), rights, or obligations transferred from the

reporting corporation to the foreign related party and from

the foreign related party to the reporting corporation;

2. A description of all services performed by the

reporting corporation for the foreign related party and by

the foreign related party for the reporting corporation; and

3. A reasonable estimate of the FMV of all properties

and services exchanged, if possible, or some other

reasonable indicator of value.

See the instructions for Part IV, earlier, for information

on reasonable estimates and small amounts.

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Part VII—Additional Information

!

All reporting corporations must complete the

additional information in Part VII.

CAUTION

Lines 40a and 40b. Section 267A disallows a deduction

for certain interest or royalty paid or accrued pursuant to a

hybrid arrangement, to the extent that, under the foreign

tax law, there is not a corresponding income inclusion

(including long-term deferral). Report on line 40b the total

amount of interest and royalty paid or accrued by the

reporting corporation (including, in the case of a reporting

corporation that is a partner of a partnership, the reporting

corporation’s allocable share of interest or royalty paid or

accrued by the partnership) for which a deduction is

disallowed under section 267A.

Payments to which section 267A applies. Interest or

royalty paid or accrued by the reporting corporation

(including through a partnership) is subject to section

267A. Section 267A generally applies to interest or royalty

paid or accrued pursuant to a hybrid arrangement (such

as, for example, a payment pursuant to a hybrid

instrument, or a payment to a reverse hybrid), provided

that the payment or accrual is to a related party (or

pursuant to a structured arrangement). In addition,

pursuant to an imported mismatch rule, section 267A

generally applies to interest or royalty paid or accrued

pursuant to a non-hybrid arrangement where the income

attributable to that payment or accrual is directly or

indirectly offset by certain deductions involving hybridity

incurred by a related party or pursuant to a structured

arrangement. However, section 267A does not apply if a

de minimis exception is satisfied. See Regulations section

1.267A-1(c). For purposes of section 267A, interest and

royalty are defined broadly. For additional information

about arrangements subject to section 267A, see

Regulations sections 1.267A-2 and 1.267A-4. Also see

the anti-avoidance rule under Regulations section

1.267A-5(b)(6).

Extent to which deduction is disallowed. When

section 267A applies to interest or royalty paid or accrued

pursuant to a hybrid arrangement, it generally disallows a

deduction for the amount to the extent that, under the

foreign tax law, there is not a corresponding income

inclusion (including long-term deferral). However, the

deduction is not disallowed to the extent the amount is

directly or indirectly included in income in the United

States, such as if the amount is taken into account with

respect to a U.S. shareholder under section 951(a) or

section 951A. For additional information, see Regulations

sections 1.267A-2 through 1.267A-4. For examples

illustrating the application of section 267A, see

Regulations section 1.267A-7.

Lines 41a–41d. Check the “Yes” box on line 41a if the

filer of this Form 5472 is claiming a deduction under

section 250 with respect to foreign-derived intangible

income (FDII) derived from any transaction with the

foreign related party and enter those amounts as

requested on lines 41b through 41d. State all amounts in

U.S. dollars and attach a schedule showing the exchange

rates used. With respect to lines 41b and 41c, the term

“sales” includes any lease, license, sublicense, exchange,

Instructions for Form 5472 (Rev. 12-2024)

or other disposition of property. See Regulations section

1.250(b)-3(b)(16).

If the filer of this Form 5472 is not claiming a deduction

under section 250 with respect to FDII derived from any

transaction with the foreign related party, check the “No”

box on line 41a and skip lines 41b through 41d.

See Form 8993, Section 250 Deduction for

Foreign-Derived Intangible Income (FDII) and Global

Intangible Low-Taxed Income (GILTI), and its instructions

for information on the section 250 deduction.

Line 42a. Check the “Yes” box if, during the tax year, the

reporting corporation had any loans to or from the related

party to which the safe-haven rate rules of Regulations

section 1.482-2(a)(2)(iii)(B) are applicable, and for which

the reporting corporation used a rate of interest within the

relevant safe-haven range (100% to 130% of the

Applicable Federal Rate (AFR) for the relevant term).

Line 42b. Check the "Yes" box if during the tax year the

reporting corporation had any loans to or from the related

party to which the safe-haven rate rules of Regulations

section 1.482-2(a)(2)(iii)(B) are applicable, and for which

the reporting corporation used a rate of interest outside

the relevant safe-haven range (100% to 130% of the AFR

for the relevant term).

Lines 43a and 43b

Note. Complete lines 43a, 43b(1), and 43b(2) only if the

reporting corporation is a domestic corporation. (Do not

complete these lines if the reporting corporation is a

foreign-owned U.S. DE.) In completing these lines, do not

account for debt instruments that were issued, or

distributions or acquisitions that occurred, before April 5,

2016. See Regulations sections 1.385-3(g)(3) and (b)(3)

(viii).

Line 43a. Check the “Yes” box if the reporting corporation

issued a covered debt instrument in any of the

transactions described in Regulations section 1.385-3(b)

(2) during the tax year with respect to a related party that

is a corporation. Also check “Yes” if the reporting

corporation issued or refinanced indebtedness owed to a

related party that is a corporation during the 36 months

before or after the date of a distribution or acquisition

described in Regulations section 1.385-3(b)(3)(i) made by

the reporting corporation, and either the issuance or

refinance of indebtedness, or the distribution or

acquisition, occurred during the tax year. Otherwise,

check “No.” Apply Regulations section 1.385-3(b)(3)(iii)(E)

to determine when a debt instrument is treated as issued

for purposes of Regulations section 1.385-3(b)(3)(iii).

Apply Regulations section 1.385-3(f) in the case of a

controlled partnership within the meaning of Regulations

section 1.385-1(c)(1).

Debt that the reporting corporation treats as stock

pursuant to Regulations section 1.385-3 still should be

included when completing line 43a.

Line 43b(1). Provide the total amount of the transactions

described in Regulations section 1.385-3(b)(2) (as

measured by the FMV of the distributions or, as the case

may be, of the property exchanged for the debt

instruments), and of the distributions and/or acquisitions

described in Regulations section 1.385-3(b)(3)(i) (as

Instructions for Form 5472 (Rev. 12-2024)

measured by the FMV of the property distributed and/or

acquired).

Line 43b(2). Provide the total amount (as measured by

issue price in the case of an instrument treated as stock

upon issuance, or adjusted issue price in the case of an

instrument deemed exchanged for stock) of the debt

instrument issuances addressed by line 43a. See

Regulations sections 1.385-1(d)(1) and 1.385-3(d). The

adjusted issue price of a debt instrument is the issue price

increased by the amount of original issue discount

previously includible in gross income of any holder and

decreased by payments other than payments of qualified

stated interest. See section 1272(a)(4) and Regulations

section 1.1275-1(b)(1).

Part VIII—Cost Sharing Arrangement

(CSA)

Note. A separate Part VIII must be filed for each CSA, as

defined in Regulations section 1.482-7(b) in which the

reporting corporation was a controlled participant (as

defined in Regulations section 1.482-7(j)) during the tax

year.

All amounts should be reported in U.S. dollars.

Line 44. Provide a brief description of the CSA, including

the industry and intangibles involved, and sufficient detail

to distinguish the CSA from any other CSAs in which the

reporting corporation is a controlled participant.

Line 47. Enter the reporting corporation’s share of

reasonably anticipated benefits (RAB) for the CSA during

the tax year. See Regulations section 1.482-7(e) for rules

on determining and updating a controlled participant’s

RAB share. If the reporting corporation applied more than

one RAB share during the tax year in determining its share

of IDCs, enter the RAB share that was applied to IDCs

incurred at the end of the year. See Regulations section

1.482-7(d) for more information on IDCs.

Lines 48b and 48c. See Regulations section 1.482-7 for

more information on determining whether stock-based

compensation is directly identified with, or reasonably

allocable to, the intangible development activity (IDA)

under the CSA. See Regulations section 1.482-7(d)(3)

and Notice 2005-99 for more information on determining

the measurement and timing of stock-based

compensation IDCs, including an election available with

respect to options on publicly traded stock and certain

other stock-based compensation. If the taxpayer made the

election described in Regulations section 1.482-7(d)(3)(iii)

(B) or Notice 2005-99, the taxpayer should attach a

statement to Form 5472 explaining that the taxpayer made

such election and include in such statement the total

amount of stock-based compensation taken into account

as an IDC for the tax year pursuant to such election. If the

taxpayer attaches the statement described in the previous

sentence, then in the entry space provided for line 48b the

taxpayer should include the total amount of stock-based

compensation taken into account as an IDC, including

stock-based compensation pursuant to the election

described above and any not subject to such election.

Check the appropriate box on line 48c to indicate

whether any stock-based compensation was granted

during the term of the CSA to individuals who performed

7

functions in business activities that generate cost shared

intangibles that was not treated as directly identified with,

or reasonably allocable to, the IDA, as defined in

Regulations section 1.482-7(d)(1)(i). This would include

stock-based compensation granted in earlier years (which

could give rise to deductions in the current tax year) that

were not treated as identified with, or reasonably allocable

to, the IDA.

Lines 49a and 49b. For the tax year, enter the total

amount of IDCs for the CSA on line 49a. See Regulations

section 1.482-7(d) for more information on IDCs. On

line 49b, enter the amount of IDCs allocable to the

reporting corporation for the tax year based on the

reporting corporation’s RAB share.

Part IX—Base Erosion Payments and

Base Erosion Tax Benefits Under

Section 59A

Line 50. Enter the amount of base erosion payments

made by the reporting corporation (if any). The term “base

erosion payment” generally means any amount paid or

accrued by the reporting corporation to a foreign person,

which is a related party, and with respect to which a

deduction is allowed under chapter 1 of the Code. See

section 59A(d)(1) and Regulations section 1.59A-3(b)(1)

(i).

Base erosion payments also include amounts paid or

accrued by the reporting corporation to a foreign related

party in connection with the acquisition of depreciable or

amortizable property (see section 59A(d)(2) and

Regulations section 1.59A-3(b)(1)(ii)), certain reinsurance

payments (see section 59A(d)(3) and Regulations section

1.59A-3(b)(1)(iii)), and certain payments relating to

expatriated entities (see section 59A(d)(4) and

Regulations section 1.59A-3(b)(1)(iv)).

For additional information about base erosion

payments, including rules for determining the amount paid

or accrued, and certain exceptions, see Regulations

section 1.59A-3.

Line 51. Enter the amount of base erosion tax benefits of

the reporting corporation (if any). The term “base erosion

tax benefit” generally means any deduction that is allowed

under chapter 1 for the tax year with respect to any base

erosion payment. See sections 59A(c)(2)(A) and 59A(c)

(2)(B) and Regulations section 1.59A-3(c) for further

details.

The term “base erosion tax benefit” also includes

certain reductions in gross premiums with respect to

certain reinsurance payments described in section 59A(d)

(3) and Regulations section 1.59A-3(c)(1)(iii) and certain

reductions in gross receipts with respect to certain

expatriated entities described in section 59A(d)(4) and

Regulations section 1.59A-3(c)(1)(iv).

8

Line 52. Enter the amount of qualified derivative

payments made by the reporting corporation. The term

“qualified derivative payment” generally means any

payment made by a taxpayer according to a derivative

with respect to which the taxpayer:

• Recognizes gain or loss as if such derivative were sold

for its FMV on the last business day of the tax year (and

any additional times required by the taxpayer’s method of

accounting);

• Treats any gain or loss so recognized as ordinary; and

• Treats the character of all items of income, deduction,

gain, or loss with respect to a payment according to the

derivative as ordinary.

Determine the amount of the qualified derivative

payments after combining all items of income, gain, loss,

or deduction arising with respect to the position during the

tax year. A qualified derivative payment is not a base

erosion payment or a base erosion tax benefit and should

not be included on Part IX, lines 50 and 51. See section

59A(h) and Regulations section 1.59A-6 for further details.

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. The estimated

burden for all other taxpayers who file this form is:

Recordkeeping . . . . . . . . . . . . . . .

17 hr., 42 min.

Learning about the law or the

form . . . . . . . . . . . . . . . . . . . . . .

3 hr., 4 min.

Preparing and sending the form to

the IRS . . . . . . . . . . . . . . . . . . . .

3 hr., 30 min.

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.

Instructions for Form 5472 (Rev. 12-2024)