IRS Form 5471 Schedule M "Transactions Between Controlled Foreign Corporation and Shareholders or Other Related Persons"

What Is Form 5471 Schedule M?

IRS Form 5471 (Schedule M), Transactions Between Controlled Foreign Corporation and Shareholders or Other Related Persons, is a document issued for U.S. persons who had control of a foreign corporation during the yearly accounting period of the foreign corporation.

The document was released by the Internal Revenue Service (IRS) and was last revised on December 1, 2018. A fillable 5471 Schedule M Form is available for download below.

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Form 5471 Schedule M Instructions

Schedule M was developed to accompany IRS Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations. However, this schedule is supposed to be filled out only by a certain category of person stated above. The official instructions developed by the IRS for Form 5471 define U.S. persons in a certain way, which includes:

  • Citizens and residents of the U.S.;
  • Nonresident aliens for whom an election is in effect under section 6013 (g) to be treated as a resident of the United States;
  • Individuals for whom an election is in effect under section 6013 (h), relating to nonresident aliens who become residents of the U.S. during the tax year and are married at the close of the tax year to a citizen or resident of the U.S.;
  • Domestic partnerships;
  • Domestic corporations;
  • Estates and trusts that are not foreign estates and trusts as defined in section 7701 (a) (31).

Besides defining the U.S. persons, the instructions also provide information on stock possessions that are considered to be controlling of a foreign corporation. To file 5471 Schedule M a U.S. person must own (any of the mentioned below):

  • More than 50% of the total combined voting power of all classes of stock of the foreign corporation entitled to vote;
  • More than 50% of the total value of shares of all classes of stock of the foreign corporation.

The numbers refer to sections of the Internal Revenue Code, which can be found on the official IRS website.


Schedule M can be vaguely divided into two parts:

  1. Identification Information. In the first part of the application a filer must enter their name, their identifying number (which can be presented by a social security number or employer identification number), name of the foreign corporation, a foreign corporation's employer identification number (if any), and the reference ID number. The reference ID number can be found on Form 5471.
  2. Information about transactions. This is the biggest part of the form where an applicant must enter the totals for each type of transaction that took place between them and the foreign corporation.

The schedule includes information about different types of transactions, such as:

  • Sales of stock in trade;
  • Sales of property rights;
  • Compensation that was received for technical, construction, engineering, or similar services;
  • Received rents, royalties, and license fees;
  • Received dividends;
  • Received interests;
  • Purchases of tangible property other than stock in trade;
  • Premiums that were paid for insurance or reinsurance;
  • Amounts loaned.
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Download IRS Form 5471 Schedule M "Transactions Between Controlled Foreign Corporation and Shareholders or Other Related Persons"

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SCHEDULE M
Transactions Between Controlled Foreign Corporation
(Form 5471)
and Shareholders or Other Related Persons
OMB No. 1545-0123
(Rev. December 2018)
Attach to Form 5471.
Department of the Treasury
Go to www.irs.gov/Form5471 for instructions and the latest information.
Internal Revenue Service
Name of person filing Form 5471
Identifying number
Name of foreign corporation
EIN (if any)
Reference ID number (see instructions)
Important: Complete a separate Schedule M for each controlled foreign corporation. Enter the totals for each type of transaction that occurred during
the annual accounting period between the foreign corporation and the persons listed in columns (b) through (f). All amounts must be stated in U.S.
dollars translated from functional currency at the average exchange rate for the foreign corporation’s tax year. See instructions.
Enter the relevant functional currency and the exchange rate used throughout this schedule
(e) 10% or more U.S.
(c) Any domestic
(d) Any other foreign
(f) 10% or more U.S.
shareholder of
(b) U.S. person
corporation or
corporation or
shareholder of any
(a) Transactions
controlled foreign
partnership controlled
partnership controlled
corporation
of
filing this return
corporation (other
by U.S. person filing
by U.S. person filing
controlling the
foreign corporation
than the U.S. person
this return
this return
foreign corporation
filing this return)
1 Sales of stock in trade (inventory) .
.
.
2 Sales of tangible property other than stock
in trade
.
.
.
.
.
.
.
.
.
.
3 Sales
of
property
rights
(patents,
trademarks, etc.)
.
.
.
.
.
.
.
4 Platform contribution transaction payments
received .
.
.
.
.
.
.
.
.
.
5 Cost sharing transaction payments received
6 Compensation
received
for
technical,
managerial, engineering, construction, or
like services .
.
.
.
.
.
.
.
.
7 Commissions received .
.
.
.
.
.
8 Rents, royalties, and license fees received
9 Hybrid dividends received (see instructions)
10 Dividends received (exclude hybrid dividends,
deemed distributions under subpart F, and
distributions of previously taxed income)
.
11 Interest received .
.
.
.
.
.
.
.
12 Premiums
received
for
insurance
or
reinsurance
.
.
.
.
.
.
.
.
.
13 Add lines 1 through 12 .
.
.
.
.
.
14 Purchases of stock in trade (inventory)
.
15 Purchases of tangible property other than
stock in trade
.
.
.
.
.
.
.
.
16 Purchases of property rights (patents,
trademarks, etc.)
.
.
.
.
.
.
.
17 Platform contribution transaction payments
paid
.
.
.
.
.
.
.
.
.
.
.
18 Cost sharing transaction payments paid .
19 Compensation paid for technical, managerial,
engineering, construction, or like services .
20 Commissions paid .
.
.
.
.
.
.
21 Rents, royalties, and license fees paid
.
22 Hybrid dividends paid (see instructions) .
23 Dividends paid (exclude hybrid dividends paid)
24 Interest paid .
.
.
.
.
.
.
.
.
25 Premiums paid for insurance or reinsurance
26 Add lines 14 through 25
.
.
.
.
.
27 Accounts Payable
.
.
.
.
.
.
.
28 Amounts borrowed (enter the maximum loan
balance during the year)—see instructions
29 Accounts Receivable
.
.
.
.
.
.
30 Amounts loaned (enter the maximum loan
balance during the year)—see instructions
For Paperwork Reduction Act Notice, see the Instructions for Form 5471.
Cat. No. 49963O
Schedule M (Form 5471) (Rev. 12-2018)
SCHEDULE M
Transactions Between Controlled Foreign Corporation
(Form 5471)
and Shareholders or Other Related Persons
OMB No. 1545-0123
(Rev. December 2018)
Attach to Form 5471.
Department of the Treasury
Go to www.irs.gov/Form5471 for instructions and the latest information.
Internal Revenue Service
Name of person filing Form 5471
Identifying number
Name of foreign corporation
EIN (if any)
Reference ID number (see instructions)
Important: Complete a separate Schedule M for each controlled foreign corporation. Enter the totals for each type of transaction that occurred during
the annual accounting period between the foreign corporation and the persons listed in columns (b) through (f). All amounts must be stated in U.S.
dollars translated from functional currency at the average exchange rate for the foreign corporation’s tax year. See instructions.
Enter the relevant functional currency and the exchange rate used throughout this schedule
(e) 10% or more U.S.
(c) Any domestic
(d) Any other foreign
(f) 10% or more U.S.
shareholder of
(b) U.S. person
corporation or
corporation or
shareholder of any
(a) Transactions
controlled foreign
partnership controlled
partnership controlled
corporation
of
filing this return
corporation (other
by U.S. person filing
by U.S. person filing
controlling the
foreign corporation
than the U.S. person
this return
this return
foreign corporation
filing this return)
1 Sales of stock in trade (inventory) .
.
.
2 Sales of tangible property other than stock
in trade
.
.
.
.
.
.
.
.
.
.
3 Sales
of
property
rights
(patents,
trademarks, etc.)
.
.
.
.
.
.
.
4 Platform contribution transaction payments
received .
.
.
.
.
.
.
.
.
.
5 Cost sharing transaction payments received
6 Compensation
received
for
technical,
managerial, engineering, construction, or
like services .
.
.
.
.
.
.
.
.
7 Commissions received .
.
.
.
.
.
8 Rents, royalties, and license fees received
9 Hybrid dividends received (see instructions)
10 Dividends received (exclude hybrid dividends,
deemed distributions under subpart F, and
distributions of previously taxed income)
.
11 Interest received .
.
.
.
.
.
.
.
12 Premiums
received
for
insurance
or
reinsurance
.
.
.
.
.
.
.
.
.
13 Add lines 1 through 12 .
.
.
.
.
.
14 Purchases of stock in trade (inventory)
.
15 Purchases of tangible property other than
stock in trade
.
.
.
.
.
.
.
.
16 Purchases of property rights (patents,
trademarks, etc.)
.
.
.
.
.
.
.
17 Platform contribution transaction payments
paid
.
.
.
.
.
.
.
.
.
.
.
18 Cost sharing transaction payments paid .
19 Compensation paid for technical, managerial,
engineering, construction, or like services .
20 Commissions paid .
.
.
.
.
.
.
21 Rents, royalties, and license fees paid
.
22 Hybrid dividends paid (see instructions) .
23 Dividends paid (exclude hybrid dividends paid)
24 Interest paid .
.
.
.
.
.
.
.
.
25 Premiums paid for insurance or reinsurance
26 Add lines 14 through 25
.
.
.
.
.
27 Accounts Payable
.
.
.
.
.
.
.
28 Amounts borrowed (enter the maximum loan
balance during the year)—see instructions
29 Accounts Receivable
.
.
.
.
.
.
30 Amounts loaned (enter the maximum loan
balance during the year)—see instructions
For Paperwork Reduction Act Notice, see the Instructions for Form 5471.
Cat. No. 49963O
Schedule M (Form 5471) (Rev. 12-2018)