TL;DR: The US return for a foreign corporation that does business in the US, or whose US income wasn't fully covered by withholding.

What it is. The foreign-corporation version of the 1120. It reports effectively connected income (taxed at regular corporate rates, plus a possible 30% branch profits tax) and any US-source passive income where the right tax wasn't withheld.

Who has to file. A foreign corporation engaged in a US trade or business at any time in the year, even if it has no ECI or no US income at all, or one with US-source income that wasn't fully settled by withholding. Missing it can cost the corporation its deductions, so the tax is then figured on gross income. Credit funds watch this closely, because lending activity in the US can create a US business.

When it's due. With a US office: the 15th day of the 4th month after year-end (April 15). Without one: the 15th day of the 6th month (June 15). Form 7004 extends either by six months.

Who files Form 1120-FA foreign corporation doing business in the US files Form 1120-F by April 15 if it has a US office or June 15 if not.Foreign corporationin a US businessForm 1120-FApr 15 (US office)Jun 15 (no office)IRStax on ECI
Doing business here means filing here, even in a loss year.

Worked example

A Cayman feeder that is treated as lending in the US receives $4m of interest that counts as ECI. With no US office, it files Form 1120-F by June 15, claiming credit for any tax the fund already withheld on its behalf.

Where you'll see it: Credit fund structuring ("is this a US trade or business?"), treaty claims, and protective filings.

Code: IRC §§ 881, 882, 884, 6072(c); Instructions for Form 1120-F · Related: ECI, Portfolio interest exemption, Section 1446 withholding, Form 1120

See all 53 terms in the glossary

This glossary is general information, simplified for learning. It is not tax, legal or investment advice, and real structures turn on facts and documents not shown here.