Form 1120-PC (2019)

What Is A Form 1120-PC

Form 1120-PC holds significance for specific entities within the corporate world, particularly those in the insurance industry. This specialized form, designated for U.S. Property and Casualty Insurance Companies, allows these businesses to calculate and report their federal income taxes. It encompasses a comprehensive declaration of income, expenses, gains, losses, and the computation of the income tax liability for the reporting period.

When to Use IRS Form 1120 PC

The IRS stipulates stringent criteria delineating the specific instances necessitating the use of Form 1120-PC:

• Companies with property and casualty insurance within their operational scope must utilize this form.
• Entities elected to be taxed under the provisions applicable to property and casualty insurance companies.
• Corporations are subject to tax under Section 831 of the Internal Revenue Code, detailing aspects pertinent to certain small insurance companies.

How To Fill Out Form 1120-PC Instruction

Completing Form 1120-PC demands a meticulous step-by-step approach:

Step 1: 

Gather requisite financial statements and pertinent documentation related to the insurance company's activities, including income, deductions, and special tax items. 

Step 2: 

Begin with the identification section by entering the company's name, address, employer identification number (EIN), and incorporation date. 

Step 3: 

Work through each part, starting with Income (Part I), and meticulously enter the amounts for underwriting income, investment income, and any other income sources. 

Step 4: 

Detail the company's Deductions (Part II) by specifying business expenditures such as losses incurred, salaries, and other relevant deductions. 

Step 5:

Calculate the Taxable Income (Part III) by subtracting the allowable deductions from the total income. 

Step 6: 

Navigate the Tax Computation (Part IV), where the company receives the total tax by applying the appropriate tax rates to its taxable income. 

Step 7: 

Address any Additional Taxes and Payments (part V), including estimates, credits, and payments previously made. 

Step 8: 

Conclude with Schedules detailing Loss Discount Computation and Special Deductions applicable to the insurer.

When to File IRS Form 1120 PC

Adherence to the filing deadline is non-negotiable for organizations mandated to submit Form 1120-PC. These entities must file the form by the 15th day of the fourth month following the close of the tax year. For example, if the tax year concludes on December 31st, the deadline for submission would be April 15th of the succeeding year. It's worth noting that the deadline is moved to the next business day when the due date falls on a weekend or federal holiday.