Specific Instructions

Important: All information reported on Form 926 must be in English. All amounts must be stated in U.S. dollars. If the information required in a given section exceeds the space provided within that section, do not write “see attached” in the section and then attach all of the information on additional sheets. Instead, complete all entry spaces in the section and attach the remaining information on additional sheets. The additional sheets must conform with the IRS version of that section.

Part I—U.S. Transferor Information

Identifying Number

The identifying number of an individual is his or her social security number (SSN). The identifying number of all others is their employer identification number (EIN).

Line 1a

If you answered “Yes” to question 1a and the asset is a tangible asset, section 367(a)(5) may require basis adjustments. If you answered “No” to question 1a and the asset is a tangible asset, the transfer is taxable under sections 367(a)(1) and (a)(5). If the asset transferred is an intangible asset, see section 367(d) and its regulations.

If you answered “No” to question 1a: If the U.S. transferor is owned directly by more than five domestic corporations immediately before the reorganiztion, but some combination of five or fewer domestic corporations controls the U.S. transferor, the U.S. transferor must designate the five or fewer domestic corporations that comprise the control group. List these designated corporations on Form 926, line 1b.

Line 1b

If the transferor went out of existence pursuant to the transfer (e.g., as in a reorganization described in section 368(a)(1)(C)), list the controlling shareholders and their identifying numbers.

Line 1c

If the transferor was a member of an affiliated group filing a consolidated tax return (see sections 1501 through 1504), but was not the parent corporation, list the name and EIN of the parent corporation and file Form 926 with the parent corporation's consolidated return.

Line 1d

If the answer to line 1d is "Yes," and if the asset is transferred in an exchange described in section 361(a) or (b), attach the following:

  • A statement that the conditions set forth in the second sentence of section 367(a)(5) and any regulations under that section have been satisfied.

  • An explanation of any basis or other adjustments made pursuant to section 367(a)(5) and any regulations thereunder.

Line 2

If a partnership (whether foreign or domestic) transfers property to a foreign corporation in an exchange described in section 367(a)(1), then a U.S. person that is a partner in the partnership shall be treated as having transferred a proportionate share of the property in an exchange described in section 367(a)(1). A U.S. person's proportionate share of partnership property shall be determined under the rules and principles of sections 701 through 761 and the regulations thereunder. See Temporary Regulations section 1.367(a)-1T(c)(3).

Line 2d.   For definition of “regularly traded on an established securities market,” see Temporary Regulations section 1.367(a)-1T(c)(3)(ii)(D). If the answer to line 2d is “Yes,” the rules of Regulations section 1.367(a)-1T(c)(3)(ii)(C) apply.

Part II—Transferee Foreign Corporation Information

Reference ID number.   A reference ID number is required on line 4b only in cases where no EIN was entered on line 4a for the transferee foreign corporation. However, filers are permitted to enter both an EIN and a reference ID number. If applicable, enter on line 4b the reference ID number (defined below) you have assigned to the transferee foreign corporation.

  A “reference ID number” is a number established by or on behalf of the U.S. transferor identified at the top of page 1 of the form that is assigned to the transferee foreign corporation with respect to which Form 926 reporting is required. These numbers are used to uniquely identify the transferee foreign corporation in order to keep track of the entity from tax year to tax year. The reference ID number must meet the requirements set forth below.

Note.

Because reference ID numbers are established by or on behalf of the U.S. person filing Form 926, there is no need to apply to the IRS to request a reference ID number or for permission to use these numbers.

Note.

In general, the reference ID number assigned to a transferee foreign corporation on Form 926 has relevance only to Form 926 and should not be used with respect to the transferee foreign corporation on other IRS forms.

Requirements.   The reference ID number must be alphanumeric (defined below) and no special characters or spaces are permitted. The length of a given reference ID number is limited to 50 characters.

  For these purposes, the term “alphanumeric” means the entry can be alphabetical, numeric, or any combination of the two.

  The same reference ID number must be used consistently from tax year to tax year with respect to a given transferee foreign corporation. If for any reason a reference ID number falls out of use (for example, the transferee foreign corporation no longer exists due to disposition or liquidation), the reference ID number used for that transferee foreign corporation cannot be used again for another transferee foreign corporation for purposes of Form 926 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 transferee foreign corporation. For example:
  • In the case of a merger or acquisition, a Form 926 filer must use a reference ID number which correlates the previous reference ID number with the new reference ID number assigned to the transferee foreign corporation.

  • In the case of an entity classification election that is made on behalf of a transferee foreign corporation on Form 8832, Regulations section 301.6109-1(b)(2)(v) requires the transferee foreign corporation to have an EIN for this election. For the first year that Form 926 is filed after an entity classification election is made on behalf of the transferee foreign corporation on Form 8832, the new EIN must be entered on line 4a and the old reference ID number must be entered on line 4b. In subsequent years, the Form 926 filer may continue to enter both the EIN and the reference ID number, but must enter at least the EIN on line 4a.

  You must correlate the reference ID numbers as follows: New reference ID number [space] Old reference ID number. If there is more than one old reference ID number, you must enter a space between each such number. As indicated above, the length of a given reference ID number is limited to 50 characters and each number must be alphanumeric and no special characters are permitted.

Note.

This correlation requirement applies only to the first year the new reference ID number is used.

Line 5.    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; however, if you file electronically, please follow the convention specified.

Line 6.   Enter the two-letter country code (from the list at www.IRS.gov/countrycodes) of the transferee foreign corporation's country of incorporation or organization.

Line 7.   List the entity classification (e.g., partnership, corporation, etc.) of the transferee foreign corporation under the laws of the country of incorporation or organization.

Line 8.   See section 957(a) to determine whether the corporation is a controlled foreign corporation immediately after the transfer.

Part III—Information Regarding Transfer of Property

Column (a). Date of Transfer.   Enter the first date on which title to, possession of, or rights to the use of the property passed for U.S. income tax purposes. See Temporary Regulations section 1.6038B-1T(b)(4) for additional information.

Column (b). Description of property.   Provide a description of the property transferred. With respect to section 6038B(a)(1)(A) transfers, see Temporary Regulations section 1.6038B-1T(c)(4) for specific information that must be reported in column (b) (or, if necessary, under the Supplemental Information section or on attached sheets). With respect to section 367(d) transfers, see Temporary Regulations section 1.6038B-1T(d). With respect to section 367(e) transfers, see Regulations section 1.6038B-1(e).

Column (c). Fair market value.   Enter the fair market value of the property transferred (measured as of the date of transfer).

Column (d). Cost or other basis.   Enter your adjusted basis in the property transferred on the date of the transfer. See sections 1011 through 1016 for more information for the determination of adjusted basis.

Supplemental information required to be reported

Enter any information from Part III that is required to be reported in greater detail. Identify the applicable column number next to the information entered in this section. In addition, if you contributed property to a foreign corporation as a part of a wider transaction, briefly describe the entire transaction.

Part IV— Additional Information Regarding Transfer of Property

Line 10.   List the type of nonrecognition transaction that gave rise to the reporting obligation (e.g., section 332, 351, 354, 356, or 361).

Line 11a.   If gain recognition was required with respect to any transfer reported in Part III under section 904(f)(3), attach a statement identifying the transfer and the amount of gain recognized.

Line 11b.    If gain recognition was required with respect to any transfer reported in Part III under section 904(f)(5)(F), attach a statement identifying the transfer and the amount of gain recognized.

Line 11c.   If recapture was required with respect to any transfer reported in Part III under section 1503(d) (dual consolidated loss), attach a statement identifying the transfer and the amount of recapture. See section 1503(d) and the regulations thereunder.

Line 11d.   If exchange gain recognition was required with respect to any transfer reported in Part III under section 987, attach a statement identifying the transfer and the amount of exchange gain recognized. See Regulations section 1.987-5.

Line 12.   If this transfer resulted from a change in the classification of the transferee to that of a foreign corporation (a deemed transfer resulting from a classification change on Form 8832, Entity Classification Election, or a termination of a section 1504(d) election), check the “Yes” box. If the transfer was an actual transfer of property to a foreign corporation, check the “No” box.

Line 13.   See final and temporary Regulations sections 1.367(a)-4 through 1.367(a)-6 for instances in which a transferor must recognize income on the transfer of tangible property that qualifies for nonrecognition treatment (see section 367(a)(3) and Temporary Regulations section 1.367(a)-2T). Additional information is required to be attached to this form. See Temporary Regulations sections 1.6038B-1T(c)(4)(iii) and (vii), and 1.6038B-1T(c)(5).

Line 17a.   If you checked the "Yes" box, additional information is required to be attached to this form. See Temporary Regulations section 1.6038B-1T(d).

Line 17b.   See Temporary Regulations section 1.6038B-1T(d).


More Online Instructions