Form 1120S Schedule M 3 PDF Details

Delving into the complexities of corporate taxation, the Schedule M-3 form stands as a critical document for S corporations with total assets of $10 million or more, as required by the Department of the Treasury and the Internal Revenue Service for the 2010 tax year. This form, attached to Form 1120S, serves the purpose of reconciling net income or loss, aiming to illuminate the differences between financial accounting and tax reporting. By answering the initial question about the preparation of a certified audited or non-audited non-tax-basis income statement, corporations begin a detailed journey through their financial landscape. The form intricately requires the disclosure of worldwide consolidated net income or loss, adjustments for transactions with nonincludible entities, and a myriad of other financial factors from foreign and U.S. sources alike. Additionally, parts II and III further dissect income and expenses/deductions to match financial statement figures with those reflected on the tax return, guiding through adjustments due to foreign operations, equity methods, hedging transactions, and an array of income or loss items needing reconciliation. The Schedule M-3 forms a bridge between accounting practices and tax obligations, presenting a comprehensive view of a corporation’s financial health and adherence to tax reporting requirements.

QuestionAnswer
Form NameForm 1120S Schedule M 3
Form Length3 pages
Fillable?No
Fillable fields0
Avg. time to fill out45 sec
Other namesf1120ss3 2010 schedule m 3 form

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SCHEDULE M-3

Net Income (Loss) Reconciliation for S Corporations

OMB No. 1545-0130

(Form 1120S)

With Total Assets of $10 Million or More

2010

 

Department of the Treasury

▶ Attach to Form 1120S.

Internal Revenue Service

▶ See separate instructions.

 

Name of corporation

 

Employer identification number

 

 

 

 

Part I Financial Information and Net Income (Loss) Reconciliation (see instructions)

1 a Did the corporation prepare a certified audited non-tax-basis income statement for the period ending with or within this tax year? (See instructions if multiple non-tax-basis income statements are prepared.)

Yes. Skip line 1b and complete lines 2 through 11 with respect to that income statement.

No. Go to line 1b.

bDid the corporation prepare a non-tax-basis income statement for that period?

Yes. Complete lines 2 through 11 with respect to that income statement.

No. Skip lines 2 through 3b and enter the corporation’s net income (loss) per its books and records on line 4a.

2 Enter the income statement period: Beginning

/

/

Ending

/

/

3 a Has the corporation’s income statement been restated for the income statement period on line 2? Yes. (If “Yes,” attach an explanation and the amount of each item restated.)

No.

bHas the corporation’s income statement been restated for any of the five income statement periods preceding the period on line 2?

Yes. (If “Yes,” attach an explanation and the amount of each item restated.)

No.

4a

Worldwide consolidated net income (loss) from income statement source identified in Part I, line 1 .

4a

 

 

b

Indicate accounting standard used for line 4a (see instructions):

 

 

 

 

(1)

GAAP

(2)

IFRS

 

 

 

 

(3)

Tax-basis

(4)

Other (specify)

 

 

 

 

 

 

 

 

 

 

 

 

5a

Net income from nonincludible foreign entities (attach schedule)

5a

(

)

b

Net loss from nonincludible foreign entities (attach schedule and enter as a positive amount) . . .

5b

 

 

6 a

Net income from nonincludible U.S. entities (attach schedule)

6a

(

)

b

Net loss from nonincludible U.S. entities (attach schedule and enter as a positive amount) . . . .

6b

 

 

7a

Net income (loss) of other foreign disregarded entities (attach schedule)

7a

 

 

b

Net income (loss) of other U.S. disregarded entities (except qualified subchapter S subsidiaries)

 

 

 

 

(attach schedule)

7b

 

 

c

Net income (loss) of other qualified subchapter S subsidiaries (QSubs) (attach schedule)

7c

 

 

8

Adjustment to eliminations of transactions between includible entities and nonincludible entities

 

 

 

 

(attach schedule)

8

 

 

9

Adjustment to reconcile income statement period to tax year (attach schedule)

9

 

 

10

Other adjustments to reconcile to amount on line 11 (attach schedule)

10

 

 

11

Net income (loss) per income statement of the corporation. Combine lines 4 through 10 . . .

11

 

 

 

Note. Part I, line 11, must equal Part II, line 26, column (a).

 

 

 

12Enter the total amount (not just the corporation’s share) of the assets and liabilities of all entities included or removed on the following lines:

aIncluded on Part I, line 4

bRemoved on Part I, line 5

cRemoved on Part I, line 6

dIncluded on Part I, line 7

Total Assets

Total Liabilities

For Paperwork Reduction Act Notice, see the Instructions for Form 1120S.

Cat. No. 39666W

Schedule M-3 (Form 1120S) 2010

Schedule M-3 (Form 1120S) 2010

Page 2

Name of corporation

Employer identification number

Part II Reconciliation of Net Income (Loss) per Income Statement of the Corporation With Total Income (Loss) per Return (see instructions)

 

Income (Loss) Items

1

Income (loss) from equity method foreign

 

corporations (attach schedule)

2

Gross foreign dividends not previously taxed . . .

3Subpart F, QEF, and similar income inclusions (attach schedule)

4Gross foreign distributions previously taxed (attach schedule)

5Income (loss) from equity method U.S. corporations (attach schedule)

6

U.S. dividends not eliminated in tax consolidation .

7Income (loss) from U.S. partnerships (attach

schedule) . . . . . . . . . . . . . . .

8Income (loss) from foreign partnerships (attach

schedule) . . . . . . . . . . . . . . .

9Income (loss) from other pass-through entities

(attach schedule) . . . . . . . . . . . .

10Items relating to reportable transactions (attach

details) . . . . . . . . . . . . . . . .

11 Interest income (attach Form 8916-A) . . . . .

12Total accrual to cash adjustment . . . . . . .

13

Hedging transactions

14

Mark-to-market income (loss)

15

Cost of goods sold (attach Form 8916-A) . . . .

16

Sale versus lease (for sellers and/or lessors) . . .

17Section 481(a) adjustments . . . . . . . . .

18Unearned/deferred revenue . . . . . . . . .

19Income recognition from long-term contracts . . .

20

Original issue discount and other imputed interest .

21a

Income statement gain/loss on sale, exchange,

 

abandonment, worthlessness, or other disposition of

 

assets other than inventory and pass-through entities

bGross capital gains from Schedule D, excluding

amounts from pass-through entities . . . . . .

cGross capital losses from Schedule D, excluding amounts from pass-through entities, abandonment

 

losses, and worthless stock losses

d

Net gain/loss reported on Form 4797, line 17,

 

excluding amounts from pass-through entities,

 

abandonment losses, and worthless stock losses .

e

Abandonment losses

f

Worthless stock losses (attach details)

gOther gain/loss on disposition of assets other than

inventory . . . . . . . . . . . . . . .

22Other income (loss) items with differences (attach

 

schedule)

23

Total income (loss) items. Combine lines 1 through

 

22

24

Total expense/deduction items (from Part III, line

 

32)

25

Other items with no differences

26Reconciliation totals. Combine lines 23 through 25

(a)

(b)

(c)

(d)

Income (Loss) per

Temporary

Permanent

Income (Loss) per

Income Statement

Difference

Difference

Tax Return

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(

)

(

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Note. Line 26, column (a), must equal the amount on Part I, line 11, and column (d) must equal Form 1120S, Schedule K, line 18.

Schedule M-3 (Form 1120S) 2010

Schedule M-3 (Form 1120S) 2010

Page 3

Name of corporation

Employer identification number

Part III Reconciliation of Net Income (Loss) per Income Statement of the Corporation With Total Income (Loss) per Return—Expense/Deduction Items (see instructions)

 

Expense/Deduction Items

1

U.S. current income tax expense

2

U.S. deferred income tax expense

3

State and local current income tax expense . . .

4

State and local deferred income tax expense . . .

5

Foreign current income tax expense (other than

 

foreign withholding taxes)

6

Foreign deferred income tax expense

7

Equity-based compensation

8

Meals and entertainment

9

Fines and penalties

10

Judgments, damages, awards, and similar costs . .

11

Pension and profit-sharing

12

Other post-retirement benefits

13

Deferred compensation

14

Charitable contribution of cash and tangible

 

property

15Charitable contribution of intangible property . . .

16Current year acquisition or reorganization investment

banking fees . . . . . . . . . . . . . .

17Current year acquisition or reorganization legal and

accounting fees . . . . . . . . . . . . .

18Current year acquisition/reorganization other costs .

19Amortization/impairment of goodwill . . . . . .

20Amortization of acquisition, reorganization, and

 

start-up costs

21

Other amortization or impairment write-offs . . .

22

Section 198 environmental remediation costs . . .

23a

Depletion—Oil & Gas

b

Depletion—Other than Oil & Gas

24

Depreciation

25

Bad debt expense

26

Interest expense (attach Form 8916-A)

27

Corporate owned life insurance premiums . . . .

28

Purchase versus lease (for purchasers and/or

 

lessees)

29Research and development costs (attach schedule) .

30Section 118 exclusion (attach schedule) . . . . .

31Other expense/deduction items with differences

(attach schedule) . . . . . . . . . . . .

32Total expense/deduction items. Combine lines 1 through 31. Enter here and on Part II, line 24, reporting positive amounts as negative and negative

amounts as positive . . . . . . . . . . .

(a)

Expense per

Income Statement

(b)

Temporary Difference

(c)

Permanent Difference

(d)

Deduction per

Tax Return

Schedule M-3 (Form 1120S) 2010

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1. Start filling out the Form 1120S Schedule M 3 with a group of essential blanks. Note all of the necessary information and make sure there is nothing omitted!

Form 1120S Schedule M 3 writing process outlined (stage 1)

2. Once the last array of fields is finished, it is time to add the required particulars in Indicate accounting standard used, IFRS Other specify, GAAP Taxbasis, a Net income from nonincludible, b Net loss from nonincludible, a Net income from nonincludible, b Net loss from nonincludible US, a Net income loss of other, b Net income loss of other US, attach schedule, c Net income loss of other, Adjustment to eliminations of, Adjustment to reconcile income, Other adjustments to reconcile to, and Net income loss per income so that you can move forward further.

Filling out section 2 in Form 1120S Schedule M 3

3. Completing Total Assets, Total Liabilities, Included on Part I line a b, For Paperwork Reduction Act Notice, Cat No W, and Schedule M Form S is essential for the next step, make sure to fill them out in their entirety. Don't miss any details!

Included on Part I line a b, Cat No W, and Total Liabilities inside Form 1120S Schedule M 3

4. This specific part arrives with these particular blanks to consider: Schedule M Form S, Name of corporation, Employer identification number, Page, Part II, Reconciliation of Net Income Loss, Income Loss Items, Income Loss per Income Statement, Temporary Difference, Permanent Difference, Income Loss per, Tax Return, Income corporations attach schedule, equity method, and loss.

Income Loss per, Page, and equity method of Form 1120S Schedule M 3

As to Income Loss per and Page, be certain that you take another look here. Both of these are considered the most significant fields in this PDF.

5. This document needs to be completed by filling out this part. Below you'll find a full listing of blanks that need specific details to allow your document submission to be faultless: Income recognition from, Hedging transactions, b Gross capital gains from, amounts from passthrough entities, c Gross capital losses from, d Net gainloss reported on Form, excluding amounts abandonment, e Abandonment losses f Worthless, inventory, Other income loss items with, schedule, Total income loss items Combine, Total expensededuction items from, and Other items with no differences.

Other items with no differences, Total income loss items Combine, and amounts from passthrough entities of Form 1120S Schedule M 3

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