Updated October 16, 2026. Quick answer: Form 5472 is the “Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business”. “Generally, a reporting corporation must file Form 5472 if it had a reportable transaction with a foreign or domestic related party.” “File Form 5472 as an attachment to the reporting corporation’s income tax return by the due date (including extensions) of that return.” “A penalty of $25,000 will be assessed on any reporting corporation that fails to file Form 5472 when due and in the manner prescribed.”
What Form 5472 is for
The form’s cover line reads “(Under Sections 6038A and 6038C of the Internal Revenue Code)”. The instructions state the purpose: “Use Form 5472 to provide information required under sections 6038A and 6038C when reportable transactions occur during the tax year of a reporting corporation with a foreign or domestic related party.”
Business owners most often meet the form through a U.S. entity with a foreign owner. Formation basics are on the do you need an LLC page and the EIN page.
Reporting corporation and foreign shareholder
The instructions define the terms the rest of the form uses:
| Term | As defined in the instructions |
|---|---|
| Reporting corporation | “A 25% foreign-owned U.S. corporation (including a foreign-owned U.S. disregarded entity (DE)), or” “A foreign corporation engaged in a trade or business within the United States.” |
| 25% foreign owned | “A corporation is 25% foreign owned if it has at least one direct or indirect 25% foreign shareholder at any time during the tax year.” |
| 25% foreign shareholder | “Generally, a foreign person (defined later) is a 25% foreign shareholder if the person owns, directly or indirectly, at least 25% of either:” “The total voting power of all classes of stock entitled to vote, or” “The total value of all classes of stock of the corporation.” |
A foreign person is one of these: “An individual who is not a citizen or resident of the United States;” “Any partnership, association, company, or corporation that is not created or organized in the United States;” “Any foreign estate or foreign trust described in section 7701(a)(31); or” and the other categories the instructions list.
For a single-owner U.S. entity: “A foreign-owned U.S. DE is a domestic DE that is wholly owned by a foreign person.” “For tax years beginning on or after January 1, 2017, and ending on or after December 13, 2017, a foreign-owned U.S. DE is treated as an entity separate from its owner and classified as a corporation for the limited purposes of the requirements under section 6038A that apply to 25% foreign-owned domestic corporations.”
Related parties and reportable transactions
The filing duty turns on a related party:
| Item | A related party is, as printed |
|---|---|
| 1 | “Any direct or indirect 25% foreign shareholder of the reporting corporation,” |
| 2 | “Any person who is related (within the meaning of section 267(b) or 707(b)(1)) to the reporting corporation,” |
| 3 | “Any person who is related (within the meaning of section 267(b) or 707(b)(1)) to a 25% foreign shareholder of the reporting corporation, or” |
| 4 | “Any other person who is related to the reporting corporation within the meaning of section 482 and the related regulations.” |
“A reportable transaction is:” “Any type of transaction listed in Part IV (for example, sales, rents, etc.) for which monetary consideration (including U.S. and foreign currency) was the sole consideration paid or received during the reporting corporation’s tax year;” “Any transaction listed in Part V; or” “Any transaction or group of transactions listed in Part VI.”
The monetary categories on the form include “Sales of stock in trade (inventory)”, “Rents received (for other than intangible property rights)” and “Commissions received”.
The instructions allow estimates: “A reasonable estimate is any amount reported on Form 5472 that is at least 75% but not more than 125% of the actual amount required to be reported.” “A reporting corporation that uses an accrual method of accounting must use accrued payments and accrued receipts for purposes of computing the total amount to enter on each line of Form 5472.”
Who must file and who does not
“Generally, a reporting corporation must file Form 5472 if it had a reportable transaction with a foreign or domestic related party.” “File a separate Form 5472 for each foreign or U.S. person who is a related party with which the reporting corporation had a reportable transaction.”
The exceptions, selected from the six printed:
| Exception | A reporting corporation is not required to file if, as printed (selected) |
|---|---|
| 1 | “It had no reportable transactions of the types listed in Parts IV and VI of the form and, in the case of a reporting corporation that is a foreign-owned U.S. DE, also had no reportable transactions of the type listed in Part V of the form.” |
| 2 | “A U.S. person that controls the foreign related corporation files Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations, for the tax year to report information under section 6038.” To qualify, the U.S. person must complete Schedule M (Form 5471) showing all reportable transactions between the reporting corporation and the related party for the tax year. This exception does not apply to foreign-owned U.S. DEs. |
| 3 | “The related corporation qualifies as a foreign sales corporation for the tax year and files Form 1120-FSC” This exception does not apply to foreign-owned U.S. DEs. |
| 4 | “It is a foreign corporation that does not have a permanent establishment in the United States under an applicable income tax treaty and timely files Form 8833” |
| 5 | “It is a foreign corporation all of whose gross income is exempt from taxation under section 883” |
A related party excludes some filers: “does not include any corporation filing a consolidated federal income tax return with the reporting corporation.”
The parts of the form
The form is organized by part:
| Part | Heading or instruction, as printed |
|---|---|
| Part I | “Reporting Corporation” |
| Part II | “Only 25% foreign-owned U.S. corporations, including foreign-owned U.S. DEs, complete Part II.” |
| Part III | “Related Party” |
| Part IV | “Monetary Transactions Between Reporting Corporations and Foreign Related Party” |
| Part VI | “Nonmonetary and Less-Than-Full Consideration Transactions Between the Reporting Corporation and the Foreign Related Party” |
Part V applies to a single-owner entity: “You must check the box in Part V if you are a foreign-owned DE that had any other transaction, as defined by Regulations section 1.482-1(i)(7) not already entered in Part IV.”
For nonmonetary transactions: “If the related party is a foreign person, the reporting corporation must attach a schedule describing each reportable transaction or group of reportable transactions.”
When and where to file
“File Form 5472 as an attachment to the reporting corporation’s income tax return by the due date (including extensions) of that return.”
A single-owner U.S. entity has no income tax return of its own, so the instructions say “it will now be required to file a pro forma Form 1120, U.S. Corporation Income Tax Return, with Form 5472 attached by the due date (including extensions) of that Form 1120.” “If you are a foreign-owned U.S. DE, you cannot file Form 5472 electronically.”
Penalties and records
“A penalty of $25,000 will be assessed on any reporting corporation that fails to file Form 5472 when due and in the manner prescribed.” “The penalty also applies for failure to maintain records as required by Regulations section 1.6038A-3.” “Filing a substantially incomplete Form 5472 constitutes a failure to file Form 5472.”
“If the failure continues for more than 90 days after notification by the IRS, an additional penalty of $25,000 will apply.” “This penalty applies with respect to each related party for which a failure occurs for each 30-day period (or part of a 30-day period) during which the failure continues after the 90-day period ends.” As an illustration, not an IRS example, with one related party and a failure running into a third 30-day period after the 90-day period ends, the additional penalty is 3 periods times $25,000 which is $75,000 and with the first $25,000 added the total is $100,000.
“Each member of a group of corporations filing a consolidated information return is a separate reporting corporation subject to a separate $25,000 penalty and each member is jointly and severally liable.” “A reporting corporation must keep the permanent books of account or records as required by section 6001.” Offshore reporting for individuals is a different rulebook; see the FBAR and Form 8938 page. The edition read for this page is Form 5472 (Rev. December 2023) and the Instructions for Form 5472 (Rev. December 2024, for use with the December 2023 revision of the form), which are the revisions irs.gov served when they were read on 2026-10-16. Check the revision printed on the form you are filing, because a later revision can change the parts, the exceptions and the penalty wording.
Common mistakes
- Skipping the form because the entity has no tax return. The instructions say a foreign-owned U.S. disregarded entity must file a pro forma Form 1120 with Form 5472 attached, and it cannot file Form 5472 electronically.
- Filing one form for several related parties. The instructions say to file a separate Form 5472 for each foreign or U.S. person who is a related party with which there was a reportable transaction.
- Treating an incomplete form as filed. The instructions say filing a substantially incomplete Form 5472 constitutes a failure to file, which carries the $25,000 penalty.
Related: do you need an LLC, how to get an EIN, anonymous LLC states, foreign inheritance Form 3520, and FBAR vs Form 8938.
Sources
- Form 5472 (Rev. December 2023), Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business: https://www.irs.gov/pub/irs-pdf/f5472.pdf
- Instructions for Form 5472 (Rev. December 2024): https://www.irs.gov/pub/irs-pdf/i5472.pdf
Read from the IRS documents linked above on October 16, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.