This Schedule B Form 1120 guide explains the IRS Additional Information for Schedule M-3 Filers. Schedule B for Form 1120 asks for additional information for covered Schedule M-3 filers. It is not the individual interest-and-dividend schedule. Corporate financial reporting and the instructions determine which additional disclosures apply.
Reviewed October 31, 2026. This is an independent guide. The version and availability information below identifies the IRS documents used for this page.
What Schedule B Form 1120 does and who prepares it
A corporation supplies the additional information required for its applicable Schedule M-3 filing.
For the connected reporting route, see Form 1120. Keep the role of that document separate from the task explained on this page.
| Official form | Form 1120 (Schedule B) |
|---|---|
| IRS title | Additional Information for Schedule M-3 Filers |
| Guide period | the applicable reporting period |
| Target version | Dec 2018 |
| Availability | Current IRS catalog PDF |
| Last checked | October 31, 2026 |
Get the Schedule B Form 1120 PDF and check its status
Use the IRS source to confirm the document before completing a real filing. The download link is a reference to the official file; it is not a statement that every copy inside the PDF may be printed and submitted. Follow any instructions about electronic filing, scannable copies, recipient copies or attachments.
Which version of Schedule B Form 1120 should you use?
This form follows a revision or continuing-use format rather than a new title for every calendar year. Check the revision printed on the document and the period requested inside it. A revision date, transaction date and tax year are different pieces of information. The current document should be read with the instructions that apply to the actual transaction or return.
Records to gather for Schedule B Form 1120
- Corporate financial statements.
- M-3 workpapers.
- Ownership and reporting details.
- Requested transaction information.
- Corporate return.
Keep a working reconciliation with these records. It should show the source of each reported item, any correction made before filing and the reason a different amount appears on a connected form. This is especially useful when a statement is corrected or a prior-year balance continues into the current calculation.
How to work through Schedule B Form 1120
- Confirm applicability. Start with the purpose, filer category and version of the form. Complete any eligibility or applicability question before spending time on the numerical calculation.
- Prepare the source workpapers. Gather the records listed below and reconcile their totals. Keep prior-year balances, current-year transactions and estimated payments separate where they serve different purposes.
- Complete dependent calculations first. When a line refers to another form, schedule or worksheet, finish that supporting calculation first. Preserve any classification, limitation and carryforward information.
- Follow the line sequence. Use the actual line labels and arithmetic in the applicable form. A line number from an older version may refer to something different after a revision.
- Reconcile the filing package. Check names, identifying numbers, tax periods, totals and required attachments. Then use the filing method, signature process and deadline that apply to this filer and form.
Form-specific IRS instructions and reporting details
The following points retain the operative wording of the IRS documents linked above. Read each point with its stated conditions and the applicable form version. References to another form or section describe a connected requirement; they do not mean that every reader must file every referenced document.
To ensure that the corporation’s tax return is correctly processed, attach all schedules and other forms after page 6 of Form 1120 in the following order. 1. Schedule N (Form 1120). 2. Schedule D (Form 1120). 3. Form 8949. 4. Form 8996. 5. Form Schedule O. 6. Form 4626. 7. Form 4797. 8. Form 1125-A. 9. Form 4136. 10. Form 8978. 11. Form 965-B. 12. Form 8941. 13. Form 3800. 14. Form 8997. 15. Form 8283. 16. Form 6252. 17. Schedule A (Form 8936). 18. Form 4255. 19. Additional schedules in alphabetical order. 20.
Additional forms in numerical order. 21. Supporting statements and attachments. Complete every applicable entry space on Form 1120. Do not enter “See Attached” or “Available Upon Request” instead of completing the entry spaces. If more space is needed on the forms or schedules, attach separate sheets using the same size and format as the printed forms.
Corporations filing a consolidated return must check Item A, box 1a, and attach Form 851, Affiliations Schedule, and other supporting statements to the return. Also, for the first year a subsidiary corporation is being included in a consolidated return, attach Form 1122 to the parent’s consolidated return. Attach a separate Form 1122 for each new subsidiary being included in the consolidated return.
If Item A, box 1a, is checked and the corporation is the common parent of a consolidated group that includes a life insurance company, also check box 1b. See Regulations section 1.1502-47(m) for the requirements for filing a consolidated tax return for a life-nonlife consolidated group.
Additional reporting conditions
Enter taxable interest on U.S. obligations and on loans, notes, mortgages, bonds, bank deposits, corporate bonds, tax refunds, etc. Do not offset interest expense against interest income. Special rules apply to interest income from certain below-market-rate loans. See section 7872 for details. Report tax-exempt interest on Schedule K, item 9. Also, if required, include the same amount on Schedule M-1, line 7, or Schedule M-3 (Form 1120), Part II, line 13, if applicable.
Note: For tax years ending after July 4, 2025, section 139L, as enacted by P.L. 119-21, allows a qualified lender to exclude 25% of the interest income received on any qualified real estate loan secured by rural or agricultural real property. See section 139L and Notice 2025-71 for more details.
Do not offset interest income against interest expense. The corporation must make an interest allocation if the proceeds of a loan were used for more than one purpose (for example, to purchase a portfolio investment and to acquire an interest in a passive activity). See Temporary Regulations section 1.163-8T for the interest allocation rules. Mutual savings banks, building and loan associations, and cooperative banks can deduct the amounts paid or credited to the accounts of depositors as dividends, interest, or earnings. See section 591. Do not deduct the following interest.
Calculations and supporting information
Dividends received on certain debt-financed stock acquired after July 18, 1984, are not entitled to the full 50% or 65% dividends-received deduction under section 243 or 245(a). The 50% or 65% deduction is reduced by a percentage that is related to the amount of debt incurred to acquire the stock. See section 246A. Also, see section 245(a) before making this computation for an additional limitation that applies to certain dividends received from foreign corporations. Attach a statement to Form 1120 showing how the amount on line 3, column (c), was figured.
Enter dividends received from wholly owned foreign subsidiaries that are eligible for the 100% deduction under section 245(b). In general, the deduction under section 245(b) applies to dividends paid out of the earnings and profits of a foreign corporation for a tax year during which: • All of its outstanding stock is directly or indirectly owned by the domestic corporation receiving the dividends, and • All of its gross income from all sources is effectively connected with the conduct of a trade or business within the United States.
Exceptions and related reporting
Line 1c. Section 1291 tax from Form 8621. If the corporation was a shareholder in a passive foreign investment company (PFIC) and received an excess distribution or disposed of its investment in the PFIC during the year, enter on line 1c the increase in taxes due under section 1291(c)(2) from Form 8621. Do not include on line 1c any interest due under section 1291(c)(3). Instead, include the amount of interest owed on Schedule J, line 9z. For more information on reporting the deferred tax and interest, see the Instructions for Form 8621.
For purposes of question 4, the constructive ownership rules of section 267(c) (excluding section 267(c)(3)) apply to ownership of interests in corporate stock and ownership of interests in the profit, loss, or capital of a partnership. If the corporation checked “Yes” to question 4a or 4b, complete and attach Schedule G (Form 1120), Information on Certain Persons Owning the Corporation’s Voting Stock.
Show any tax-exempt interest received or accrued. Include any exempt-interest dividends received as a shareholder in a mutual fund or other RIC. Also, if required, include the same amount on Schedule M-1, line 7 (or Schedule M-3 (Form 1120), Part II, line 13, if applicable).
Further form details
Who Must File Generally, filers of Form 1120 that file Schedule M-3 (Form 1120), must complete and file Schedule B (Form 1120). However, filers that (a) are required to file Schedule M-3 and have less than $50 million in total assets at the end of the tax year or (b) are not required to file Schedule M-3 and voluntarily file Schedule M-3, are not required to file Schedule B (Form 1120). See the Instructions for Schedule M-3 (Form 1120) for more information.
In the case of a consolidated group, a parent corporation files one Schedule B for the entire group.
Specific Instructions Question 1. Partnership Allocations Answer “Yes” if this corporation is a partner in a partnership and has received special allocations of income, gain, loss, deduction, or credit from such partnership. Example. P, a corporation, joins with B, an individual, in forming the PB Partnership. P and B each contribute $50,000 in cash to PB Partnership. Profits and losses are allocated equally, with the exception of depreciation, which is allocated 99% to P and 1% to B.
P answers “Yes” to question 1 because its 99% allocation of depreciation deductions from PB Partnership is disproportionate to its ratio of sharing other items of income, gain, loss, deduction, or credit from PB Partnership.
Reading the lines and boxes
These selected labels come from the linked target PDF. They are a reading aid, not a replacement for the full line instructions or a completed calculation. Match the label and document version before transferring any amount.
| Line or box | Label in the source form | What to check |
|---|---|---|
| 1 | Does any amount reported on Schedule M-3 (Form 1120), Part II, line 9 or 10, column (d), reflect allocations to this | Check the applicable line instructions and keep the source workpaper with the return records. Transfer only the information that matches the field and reporting period. |
| 2 | At any time during the tax year, did the corporation sell, exchange, or transfer any interest in an intangible asset to | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 3 | At any time during the tax year, did the corporation acquire any interest in an intangible asset from a related | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 4a | During the tax year, did the corporation enter into a cost-sharing arrangement with any related foreign party | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 5 | At any time during the tax year, did the corporation make any change in accounting principle for financial | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
Further selected fields
| Line or box | Label in the source form | What to check |
|---|---|---|
| 6 | At any time during the tax year, did the corporation make any change in a method of accounting for U.S. income | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 7 | At any time during the tax year, did the corporation own any voluntary employees’ beneficiary association (VEBA) | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 8 | At any time during the tax year, did the corporation use an allocation method for indirect costs capitalized to | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 9 | At any time during the tax year, did the corporation treat for tax purposes indirect costs, as defined in Regulations | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 10 | Did the corporation, under section 118 or 362(c) and the related regulations, take a return filing position | Check the applicable line instructions and keep the source workpaper with the return records. Transfer only the information that matches the field and reporting period. |
A practical example
A corporation preparing Schedule M-3 reviews the additional corporate disclosures. Its preparer uses the reconciled entity records to complete the related information schedule.
This example illustrates the order of the review. It does not assume an unverified deduction, exemption, treaty rate or final tax amount. The applicable form instructions and the actual records determine the result.
Common mistakes to avoid with Schedule B Form 1120
- Use the corporation-specific schedule.
- Confirm the M-3-related filing requirement.
- Keep factual disclosures consistent with the book-to-tax reconciliation.
Questions about Schedule B Form 1120
Does receiving or downloading this form mean I must file it?
A corporation supplies the additional information required for its applicable Schedule M-3 filing. The form purpose and the applicable filing or furnishing conditions determine the action. Downloading a blank PDF does not itself create a filing obligation or establish eligibility for a tax benefit.
Is the revision date always the same as the tax year?
No. Some forms show a tax year, while continuing-use forms show a revision date and ask separately for the reporting period. Check the actual document and instructions. Do not relabel a payment or transaction solely because it was reported in a later calendar year.
What should I do if the underlying information is wrong?
Use the corporation-specific schedule. Keep the original record and the correction trail. The issuer correction process, an amended return and an updated certificate can be different procedures. Choose the process that matches the document and the actual error.
Which records should I keep with the completed form?
Retain the source documents, applicable worksheets, submitted version and filing or furnishing confirmations. For this form, the working file should include corporate financial statements, M-3 workpapers, ownership and reporting details. Keep continuing balances and prior-year support for as long as they remain relevant under the applicable recordkeeping rules.
Related forms and next steps
Use these guides when the connected issue applies to your records. Each page has its own purpose, reporting year and availability status.
- Form 1120 2026: Draft PDF & Corporation Tax Returns Guide
- Schedule M-3 (Form 1120): PDF & Net Income (Loss) Reconciliation for Corporations With Total Assets of $10 Million or More Guide
- Form 1065 2026: Draft PDF & Partnership Tax Returns Guide
- Form 1120-S 2026: Draft PDF & S Corporation Tax Returns Guide