Last reviewed October 7, 2026 · By the NYBACS advisory team
Short answer
Every year. Unless it is a tax-exempt organization, every domestic corporation — including an LLC that elected corporate treatment — must file Form 1120 whether or not it has taxable income. The return is due by the 15th day of the fourth month after year-end (April 15 for a calendar year), can be extended six months with Form 7004, and must include Form 5472 when a foreign person owns 25% or more of the company.
Key takeaways
- The Form 1120 obligation starts with the corporation's first tax year and continues every year until it is formally dissolved, regardless of activity.
- Taxable profit is taxed at a flat 21% federal rate; state corporate taxes are separate.
- A corporation expecting $500 or more of tax for the year must generally pay quarterly estimated tax.
- A C-Corp that is at least 25% foreign-owned answers Schedule K question 7 and attaches Form 5472 for each related party with reportable transactions.
- Corporations filing 10 or more returns of any type in a year must generally e-file Form 1120.
Who files Form 1120
Form 1120 is the federal income tax return for C-Corps. Three kinds of foreign-owned company typically file it:
- a Delaware or other state corporation (Inc. or Corp.) owned by a non-US founder or overseas parent;
- an LLC that elected to be taxed as a corporation on Form 8832;
- a US subsidiary of a foreign group formed as a corporation for investor or group-structure reasons.
The filing duty does not depend on revenue, profit or cash. A corporation formed in November with no bank activity still files a first-year Form 1120 for that short period. Foreign-owned corporations cannot avoid this by electing S-Corp status: nonresident aliens and foreign entities are not permitted S-Corp shareholders, so a foreign-owned corporation is a C-Corp.
Due dates and the first-year short period
A calendar-year corporation files by April 15 following year-end; a fiscal-year corporation files by the 15th day of the fourth month after its year ends. Form 7004, filed by that date, extends the filing deadline by six months. The extension does not extend the time to pay, so any tax due should be estimated and paid by the original date.
The first return often covers a short year — from the incorporation date to the corporation's year-end. Choosing the year-end is a real decision for foreign-owned groups: a US subsidiary sometimes aligns with its parent's financial year (for example, March 31 for many Indian groups) to simplify consolidation. Changing it later generally requires IRS procedures, so it is better decided at the first filing. A corporation that formed late in the year and did nothing still files that short-period return, ticking the initial-return box, so the IRS record starts cleanly.
Tax, estimated payments and losses
A C-Corp's taxable income is taxed federally at a flat 21%. If the corporation expects its tax for the year to be $500 or more, it generally pays estimated tax in quarterly installments; underpaying can create an addition to tax even if the return itself is filed on time.
A loss year still requires a return. Filing preserves the net operating loss so it can be carried forward against future profits under the current rules — an important reason not to skip early-stage years. Startup and organizational costs, R&D treatment and depreciation choices made on early returns also affect later years, so the first Form 1120 sets patterns that carry forward.
Extra reporting for foreign-owned corporations
A corporation with a 25% or greater foreign shareholder answers Schedule K, question 7, disclosing the foreign owner's country, and attaches Form 5472 for each related party with reportable transactions — the parent, the founder, or a sister company abroad. Unlike a foreign-owned disregarded LLC, the corporation files a full return and can generally e-file the whole package.
Payments to foreign owners raise their own obligations:
| Payment to foreign shareholder | Typical US consequence |
|---|---|
| Dividend | 30% withholding unless a treaty reduces it; reported on Forms 1042 and 1042-S |
| Interest on a shareholder loan | Withholding generally applies; the portfolio interest exemption is not available to 10% shareholders |
| Management or royalty fees to the parent | Transfer-pricing support and possible withholding, depending on the payment and treaty |
These rules sit outside Form 1120 itself but are reviewed alongside it, because the deductions claimed on the return and the withholding filings need to agree.
State returns follow the federal one
Most states with a corporate income or franchise tax start from federal taxable income, so the Form 1120 is usually prepared first. A Delaware corporation that does not do business in Delaware generally files no Delaware income tax return but still owes Delaware franchise tax and an annual report by March 1. Where the corporation actually operates — New York, California, Texas or elsewhere — it typically files that state's corporate return as well.
Common mistakes to avoid
- Skipping Form 1120 in a year with no revenue or a loss, forfeiting a clean record of the net operating loss.
- Assuming a Form 7004 extension also delays payment of the tax due.
- Omitting Form 5472 or the Schedule K foreign-ownership answer for a 25% foreign-owned corporation.
- Trying to elect S-Corp status with a non-US shareholder.
- Paying dividends or interest to the foreign parent without considering withholding and Forms 1042/1042-S.
- Picking a year-end at random instead of aligning it with the parent group where that helps.
Documents and records to prepare
- Certificate of incorporation, bylaws and share register showing foreign ownership percentages
- Year-end trial balance, profit and loss and balance sheet
- Bank, card and payment-processor statements reconciled to the books
- Related-party schedule: parent funding, loans, intercompany charges
- Prior-year Form 1120, NOL carryforward schedule and estimated tax payments made
- Fixed-asset register and startup cost schedule
NYBACS 360° support
How NYBACS helps
- Produces year-end books and a trial balance ready for Form 1120 preparation by licensed tax professionals.
- Prepares the related-party schedules behind Form 5472 and the Schedule K foreign-ownership disclosures.
- Tracks estimated-tax dates and coordinates Form 7004 extensions with a payment estimate.
- Flags dividends, interest and fees paid to the foreign parent so withholding filings can be considered.
- Aligns the US year-end and reporting packs with the overseas parent's consolidation timetable.
Frequently Asked Questions
Does a C-Corp that never opened a bank account still file Form 1120?
Yes. The filing requirement attaches to the corporation's existence, not its activity. If the company will never be used, dissolving it formally and filing a final return ends the obligation.
Is Form 1120 filed by the foreign parent or by the US subsidiary?
By the US corporation itself, under its own EIN. The parent may have separate US filings only if it has its own US activity or income.
Can we use our Indian or UK financial year for the US company?
A US corporation can adopt a fiscal year, including one matching its parent, when it files its first return. Changing later is more involved, so align the year-end early if consolidation is a priority.
Do we need audited accounts to file Form 1120?
No. Form 1120 is prepared from the company's books; an audit is not required for the federal return. Investors, lenders or the parent group may require audited statements for their own purposes.
