SCHEDULE C

(Form 5713) Tax Effect of the International Boycott Provisions

OMB No. 1545-0216

Expires: 4-30-94 © Attach to Form 5713. (Rev. May 1991)

Department of the Treasury

Internal Revenue Service © For Paperwork Reduction Act Notice, see page 1 of Instructions for Form 5713.

Name Identifying number

1 Method used in computing loss of tax benefits under sections 908(a), 952(a)(3), 995(b)(1)(F)(ii) and 927(e)(2) (check one):

a International boycott factor from Schedule A (Form 5713). See items 2a, 3a, 4a, and 5a below ©

Identification of specifically attributable taxes and income from Schedule B (Form 5713). See items 2b, 3b, 4b, and 5b

below ©

b

2 Reduction of foreign tax credit (section 908(a)):

a International boycott factor. Complete if you checked box 1a above and answered “Yes” to foreign

tax credit question 7d, Form 5713—

(1) Foreign tax credit before adjustment (line 10, Part III, Schedule B, Form 1118 (Rev. 2-89)

(corporations); or line 30, Part IV, Form 1116 (1990) (individuals))

(2) International boycott factor (from Schedule A (Form 5713), line 3)

Reduction of foreign tax credit (multiply line 2a(1) by line 2a(2)). Enter here and on line 11, Part

III, Schedule B, Form 1118 (corporations); enter here and on line 31, Part IV, Form 1116

(individuals)

(3)

(4) Adjusted foreign tax credit (subtract line 2a(3) from line 2a(1))

b Specifically identifying taxes and income. Complete if you checked box 1b above and answered

“Yes” to foreign tax credit question 7d, Form 5713. Enter the amount from line 15, column (4),

Schedule B (Form 5713)

Enter the appropriate part of this amount on line D, Part II, Schedule G, of all applicable Form(s)

1118 (Rev. 2-89) (corporations); or on line 12, Part III, of all applicable Form(s) 1116 (individuals)

(1990).

3 Denial of deferral under subpart F (section 952(a)(3)):

International boycott factor. Complete if you checked box 1a above and answered ‘‘Yes’’ to controlled

foreign corporation question 7b, Form 5713—

a

(1) Prorated share of total income of controlled foreign corporations (See instructions.)

Prorated share of income attributable to earnings and profits of controlled foreign corporations

included in income under sections 951(a)(1)(A)(ii), 951(a)(1)(A)(iii), 951(a)(1)(B), 952(a)(1), 952(a)(2),

952(a)(4), 952(a)(5), and 952(b)

(2)

(3) Subtract line 3a(2) from line 3a(1)

(4) International boycott factor (from Schedule A (Form 5713), line 3)

(5) Prorated share of subpart F international boycott income (multiply line 3a(3) by line 3a(4)). Enter

here and on line 24, Worksheet A, contained in the Instructions for Form 5471 (Rev. 10-90)

Specifically identifying taxes and income. Complete if you checked box 1b above and answered

“Yes” to controlled foreign corporation question 7b, Form 5713. Enter the amount from line 15,

column (5), Schedule B (Form 5713). Also enter this amount on line 24, Worksheet A, contained in

the Instructions for Form 5471 (Rev. 10-90)

b

4 Denial of IC-DISC benefits (section 995(b)(1)(F)(ii)):

a International boycott factor. Complete if you checked box 1a above and answered “Yes” to IC-DISC

question 7c, Form 5713—

(1) Prorated share of section 995(b)(1)(F)(i) amount (see instructions)

(2) International boycott factor (from Schedule A (Form 5713), line 3)

(3) Prorated share of IC-DISC international boycott income (multiply line 4a(1) by line 4a(2)). (See

instructions.) Also enter this amount on line 10, Schedule J, Form 1120-IC-DISC (1990)

b Specifically identifying taxes and income. Complete if you checked box 1b above and answered

“Yes” to IC-DISC question 7c, Form 5713. Enter amount from line 15, column (6), Schedule B (Form

5713). Also enter this amount on line 10, Schedule J, Form 1120-IC-DISC (1990)

Schedule C (Form 5713) (Rev. 5-91)Cat. No. 12070O
Schedule C (Form 5713) (Rev. 5-91) Page 2

5 Denial of exemption of foreign trade income (section 927(e)(2)):

International boycott factor. Complete if you checked box 1a above and answered “Yes” to FSC

question 7i, Form 5713.

a

(1) Add amount from columns (a) and (b), line 10, Schedule B (Form 1120-FSC)(1990)

(2) International boycott factor (from Schedule A (Form 5713), line 3)

(3) Exempt foreign trade income of a FSC attributable to international boycott operations (multiply

line 5a(1) by line 5a(2)). Enter here and on line 2, Schedule F (Form 1120-FSC)

Specifically attributable taxes and income. Complete if you checked box 1b above and answered

“Yes” to question 7i, Form 5713. Enter amount from line 15, column (7), Schedule B (Form 5713).

Also enter this amount on line 2, Schedule F (Form 1120-FSC)(1990)

b

must apply it to determine its loss of

the section 902 indirect foreign tax

credit on a dividend that another

member of the controlled group paid

to it, even if the other member

determines its own loss of tax benefits

by identifying specifically attributable

taxes and income.

Instructions

(Section references are to the Internal

Revenue Code.)

Complete Schedule C (Form 5713) if

you are a partner or an IC-DISC

shareholder. Partnerships and

IC-DISCs do not have to complete

Schedule C.

Line 3a(1).—Enter your share of the

income of the controlled foreign

corporation on line 3a(1).

A person who applies the

international boycott factor to one

operation must, however, apply the

factor to all that tax year’s operations

under section 908(a), 952(a)(3),

995(b)(1)(F)(ii) or 927(e)(2).

Nonexempt foreign trade income of

a foreign sales corporation (FSC) that

was computed without regard to the

administrative pricing rules is subject

to the subpart F rules. Enter your

share of these types of income on line

3a(1).

When and Where To File.—Attach

Schedule C to Form 5713 and file in

duplicate by the due date of the return

including extensions. Send one copy

to the Internal Revenue Service

Center, Philadelphia, PA 19255, and

attach a copy to your income tax

return.

A person who identifies specifically

attributable taxes and income under

section 999(c)(2) must use that

method for all that tax year’s

operations under section 908(a),

927(e)(2), 952(a)(3), or 995(b)(1)(F).

Line 4a(1).—Enter the prorated share

of section 995(b)(1)(F)(i) amount on line

4a(1).

Controlled Groups.—Unless a

controlled group (described in section

993(a)(3)) files a consolidated return,

each member may independently

choose to apply either the

international boycott factor under

section 999(c)(1) or to identify

specifically attributable taxes and

income under section 999(c)(2). Each

member must consistently use a

single method to figure the loss of tax

benefits.

Shareholder that is not a 

C corporation.—Enter the pro-rata

share of section 995(b)(1)(F)(i) amount

(e.g., for 1990, pro-rata share of line 8,

Part I, Schedule J, Form

1120-IC-DISC).

An IC-DISC whose tax year differs

from the common taxable year of the

controlled group of which it is a

member does not need to amend its

return to show on Schedule J (Form

1120-IC-DISC) the amount of IC-DISC

benefits lost because of boycott

participation. Since the IC-DISC

benefits are lost at the shareholder

level, the shareholder must include in

Shareholder that is a 

C corporation.—Enter the pro-rata

share of excess amount of section

995(b) (1)(F)(i) multiplied by 16/17 (e.g.,

for 1990, pro-rata share of line 8, Part

I, Schedule J, Form 1120-IC-DISC

multiplied by 16/17). For example, a member that

chooses to use the international

boycott factor

income the prorated share of income

attributable to boycott operations

shown on line 4a(3).