Schedule M-3 (Form Net Income (Loss) Reconciliation for Corporations With T

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Tax Year 2008 Work Request Notification
Schedule M-3 (Form 1120), Net Income (Loss) Reconciliation
for Corporations With Total Assets of $10 Million or More
To:

Symbols:

1. Scanned by:

SE:W:CAR:MP:T: B : C

2. Section Chief:

Barbara Bradley

SE:W:CAR:MP:T: B : C

3. Reviewer:

Joan McAlpine

SE:W:CAR:MP:T: B :R

4. Review Chief:

Johnny Cervantes

5. Branch Chief:

Curt Freeman

SE:W:CAR:MP:T: B :R

Curt Freeman

SE:W:CAR:MP:T: B

6. Senior Technical Advisor: Bob Erickson

Agreed:

✔
✔
Johnny Cervantes
✔
✔

Date:
9/11/07
9/13/07
Digitally signed by Johnny Cervantes
DN: cn=Johnny Cervantes, c=US, o=TE/GE Review, ou=SE:W:
CAR:MP:T:T:R, [email protected]
Reason: I am approving this document
Date: 2007.09.14 07:45:05 -04'00'

9/14/2007
9/14/2007

Digitally signed by recipients, user mailboxes, raeric00
DN: o=internal revenue service, ou=washington dc,
cn=recipients, cn=user mailboxes, cn=raeric00
Date: 2007.09.24 10:58:24 -04'00'

SE:W:CAR:MP:T

7. *TPCC Circulations Email sent to Distribution List by:
SE:W:CAR:MP:T: B : C

8. Initiator (Tax Law Specialist): Linda Burke

Completed:

Attached is a marked up draft that can be used to develop any necessary Work Requests for
the 2009 processing year. The major changes are as follows:
The following changes will be made to the 2008 Schedule M-3 (Form 1120) at the request of the LMSB task group.
Page 1.
We inserted a rule between lines 3c and 4 to separate the financial information from the net income (loss) reconciliation.
Line 4. We inserted new "4b" with text and check boxes, (1) through (5), concerning accounting standards. On lines 1c and
3c, references to line 4 were changed to "4a."
Line 7. We inserted new line 7a, and renumbered old 7a and 7b to 7b and 7c. We also inserted "U.S." in 7b after the word
"includible."
Line 11. We inserted a note below line 11 and inserted a rule after the note.
Line 12. We inserted a new line 12 below the new rule.
Page 2.
Above line 1, we revised the text to to state "Attach schedules for lines 1 through 11."
Lines 9, 10, 11. We deleted "(attach schedule)."
Page 3.
Line 36. We inserted text to clarify the amounts to enter on Part II, line 27.

This Notification is for changes due to:
Legislation or Chief Counsel guidance:
✔

A Program change initiated by: LMSB M-3 Team
We do not anticipate the need for any further changes that would require a Work Request.

✔

We may need to make further changes that would require a Work Request.

If you have any questions, please contact the TLS shown below, or the reviewer on line 3 (above).
From:

Signed:

Linda Burke
SE:W:CAR:MP:T: B : C

Date:

Email:
[email protected]
Room:
6141

Phone Number:
(202) 927-9546
Fax Number:
Rev. 09/28/2006

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transmitted all R
text files for this
cycle update?

Date

I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

INSTRUCTIONS TO PRINTERS
SCHEDULE M-3 (FORM 1120), PAGE 1 of 4
MARGINS: TOP 13mm (1⁄ 2 ") CENTER SIDES.
PAPER: WHITE WRITING, SUB. 20.
FLAT SIZE: 216mm (81⁄ 2 ") 3 279mm (11")
PERFORATE: (NONE)

PRINTS: HEAD TO HEAD
INK: BLACK

DO NOT PRINT — DO NOT PRINT — DO NOT PRINT — DO NOT PRINT

SCHEDULE M-3
(Form 1120)

Action

Revised proofs
requested

OMB No. 1545-0123

2007

f
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©

Attach to Form 1120 or 1120-C.
© See separate instructions.

Name of corporation (common parent, if consolidated return)

Check applicable box(es):

Signature

O.K. to print

Net Income (Loss) Reconciliation for Corporations
With Total Assets of $10 Million or More

Department of the Treasury
Internal Revenue Service

Part I

Date

Employer identification number

(1)

Non-Consolidated return

(2)

Consolidated return (Form 1120 only)

(3)

Mixed 1120/L/PC group

(4)

Dormant subsidiaries schedule attached

Financial Information and Net Income (Loss) Reconciliation (see instructions)

1a Did the corporation file SEC Form 10-K for its income statement period ending with or within this tax year?
Yes. Skip lines 1b and 1c and complete lines 2a through 11 with respect to that SEC Form 10-K.
No. Go to line 1b. See instructions if multiple non-tax-basis income statements are prepared.
b Did the corporation prepare a certified audited non-tax-basis income statement for that period?
Yes. Skip line 1c and complete lines 2a through 11 with respect to that income statement.
No. Go to line 1c.
c Did the corporation prepare a non-tax-basis income statement for that period?
Yes. Complete lines 2a through 11 with respect to that income statement.
No. Skip lines 2a through 3c and enter the corporation’s net income (loss) per its books and records on line 4.
/
/
/
/
2a Enter the income statement period: Beginning
Ending

.................................... and 5a>
7 a Net income (loss) of other includible foreign disregarded entities (attach schedule)...

Note Part I, line
11, must equal Part II, line 30, column (a), and Schedule
M-2, line 2.

8/

12 Enter the total amount (not just the corporation’s share) of the assets and
liabilities of all entities included or removed on the following lines:
a
b
c
d

Included on Part I, line 4
Removed on Part I, line 5
Removed on Part I, line 6
Included on Part I, line 7

Total Assets
……………………….
……………………….
……………………….
……………………….

Total Liabilities
……………………..
……………………..
……………………..
……………………..

This page cannot be deleted from the package after it has been
signed. This page has been replaced by the previous page.

12 Indicate the total assets and total liabilities of all entities included or removed
on the following lines of Part I above:
Total Assets
Total Liabilities
a Entities included on Part I, line 4 _______________
______________
b Entities removed on Part I, line 5 _______________
______________
c Entities removed on Part I, line 6 _______________
______________
d Entities included on Part I, line 7 _______________
______________

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I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

INSTRUCTIONS TO PRINTERS
SCHEDULE M-3 (FORM 1120), PAGE 2 of 4
MARGINS: TOP 13mm (1⁄ 2 ") CENTER SIDES.
PAPER: WHITE WRITING, SUB. 20.
FLAT SIZE: 216mm (81⁄ 2 ") 3 279mm (11")
PERFORATE: (NONE)

PRINTS: HEAD TO HEAD
INK: BLACK

DO NOT PRINT — DO NOT PRINT — DO NOT PRINT — DO NOT PRINT

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Page

Schedule M-3 (Form 1120) 2007
Name of corporation (common parent, if consolidated return)

Check applicable box(es): (1)
Check if a sub-consolidated: (6)

Consolidated group (2)
1120 group (7)

Name of subsidiary (if consolidated return)

Part II

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22

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Parent corp (3)

Consolidated eliminations (4)

Subsidiary corp (5)

Mixed 1120/L/PC group

1120 eliminations

Employer identification number

Reconciliation of Net Income (Loss) per Income Statement of Includible Corporations With
Taxable Income per Return (see instructions)
Income (Loss) Items

/11/

2

Employer identification number

(a)
Income (Loss) per
Income Statement

(Attach schedules for lines 1 through 8)
Income (loss) from equity method foreign corporations
Gross foreign dividends not previously taxed
Subpart F, QEF, and similar income inclusions
Section 78 gross-up
Gross foreign distributions previously taxed
Income (loss) from equity method U.S. corporations
U.S. dividends not eliminated in tax consolidation
Minority interest for includible corporations
Income (loss) from U.S. partnerships (attach schedule)
Income (loss) from foreign partnerships (attach schedule)
Income (loss) from other pass-through entities
(attach schedule)
Items relating to reportable transactions (attach details)
Interest income (attach Form 8916-A)
Total accrual to cash adjustment
Hedging transactions
Mark-to-market income (loss)
Cost of goods sold (attach Form 8916-A)
Sale versus lease (for sellers and/or lessors)
Section 481(a) adjustments
Unearned/deferred revenue
Income recognition from long-term contracts
Original issue discount and other imputed interest

(

(b)
Temporary
Difference

)

(c)
Permanent
Difference

(d)
Income (Loss) per
Tax Return

(

)

23a Income statement gain/loss on sale, exchange,
abandonment, worthlessness, or other disposition of
assets other than inventory and pass-through entities
b Gross capital gains from Schedule D, excluding
amounts from pass-through entities
c Gross capital losses from Schedule D, excluding
amounts from pass-through entities, abandonment
losses, and worthless stock losses
d Net gain/loss reported on Form 4797, line 17,
excluding amounts from pass-through entities,
abandonment losses, and worthless stock losses
e Abandonment losses
f Worthless stock losses (attach details)
g Other gain/loss on disposition of assets other than inventory
24 Capital loss limitation and carryforward used
25 Other income (loss) items with differences (attach schedule)
26 Total income (loss) items. Combine lines 1 through 25
(
)
(
)
27 Total expense/deduction items (from Part III, line 36)
28 Other items with no differences
29a Mixed groups, see instructions. All others, add
lines 26 through 28
combine
b PC insurance subgroup reconciliation totals
c Life insurance subgroup reconciliation totals
30 Reconciliation totals. Combine lines 29a through 29c
Note. Line 30, column (a), must equal the amount on Part I, line 11, and column (d) must equal Form 1120, page 1, line 28.
Schedule M-3 (Form 1120) 2007

8

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I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

INSTRUCTIONS TO PRINTERS
SCHEDULE M-3 (FORM 1120), PAGE 3 of 4 (PAGE 4 IS BLANK)
MARGINS: TOP 13mm (1⁄ 2 ") CENTER SIDES.
PRINTS: HEAD TO HEAD
PAPER: WHITE WRITING, SUB. 20.
INK: BLACK
FLAT SIZE: 216mm (81⁄ 2 ") 3 279mm (11")
PERFORATE: (NONE)

DO NOT PRINT — DO NOT PRINT — DO NOT PRINT — DO NOT PRINT

8

Page

Schedule M-3 (Form 1120) 2007
Name of corporation (common parent, if consolidated return)

Check applicable box(es): (1)
Check if a sub-consolidated: (6)

Consolidated group (2)
1120 group (7)

6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36

Consolidated eliminations (4)

Subsidiary corp (5)

Mixed 1120/L/PC group

Employer identification number

Reconciliation of Net Income (Loss) per Income Statement of Includible Corporations With
Taxable Income per Return—Expense/Deduction Items (see instructions)
Expense/Deduction Items

1
2
3
4
5

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Parent corp (3)

1120 eliminations

Name of subsidiary (if consolidated return)

Part III

3

Employer identification number

(a)
Expense per
Income Statement

(b)
Temporary
Difference

(c)
Permanent
Difference

(d)
Deduction per
Tax Return

U.S. current income tax expense
U.S. deferred income tax expense
State and local current income tax expense
State and local deferred income tax expense
Foreign current income tax expense (other than
foreign withholding taxes)
Foreign deferred income tax expense
Foreign withholding taxes
Interest expense (attach Form 8916-A)
Stock option expense
Other equity-based compensation
Meals and entertainment
Fines and penalties
Judgments, damages, awards, and similar costs
Parachute payments
Compensation with section 162(m) limitation
Pension and profit-sharing
Other post-retirement benefits
Deferred compensation
Charitable contribution of cash and tangible
property
Charitable contribution of intangible property
Charitable contribution limitation/carryforward
Domestic production activities deduction
Current year acquisition or reorganization
investment banking fees
Current year acquisition or reorganization legal and
accounting fees
Current year acquisition/reorganization other costs
Amortization/impairment of goodwill
Amortization of acquisition, reorganization, and
start-up costs
Other amortization or impairment write-offs
Section 198 environmental remediation costs
Depletion
Depreciation
Bad debt expense
Corporate owned life insurance premiums
Purchase versus lease (for purchasers and/or
lessees)
Other expense/deduction items with differences
(attach schedule)
Total expense/deduction items. Combine lines 1
through 35. Enter here and on Part II, line 27

, reporting positive amounts as negative and negative
amounts as positive.

Schedule M-3 (Form 1120) 2007

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