Schedule O Part 1 & 2: Organization & Acquisition of Foreign Stock - IRS Form 5471

Schedule O is required when a CFC is initially formed or reorganization, or in cases where a U.S. person acquires or disposes of a certain amount of the foreign stock. In our CFC example, we are completing Parts 1 & 2 to recognize the organization of the CFC, and the acquisition of stock by a U.S. person.

This is the 15th video in a series which covers the preparation of IRS Form 5471 for the 2021 tax year. Each schedule has a separate video within the playlist titled "IRS Form 5471 - Beginner Series". A list of all of the videos with links is included in the description below.

The IRS Form 5471 is filed by U.S. persons that have an interest in a Controlled Foreign Corporation (CFC). The sample Form 5471 covered in this playlist is for a U.S. person that is a majority shareholder (75%) of a Cayman Island's Corporation. The remaining 25% of the stock is owned by a non-U.S. shareholder.

The CFC invests in various stocks, bonds & other investments, so the earnings of the CFC will constitute Subpart F income, specifically Foreign Personal Holding Company (FPHC) income under Section 954(c).

The link to the complete playlist and each individual video is below.

Playlist:    • IRS Form 5471 - Beginner Series  

Complete list of videos in the tutorial. We recommend watching in the order presented.

1. Introduction & Page 1 of Form 5471:    • How to Prepare IRS Form 5471 - Introductio...  
2. Schedule B: U.S. Shareholders:    • Schedule B: US Shareholders - IRS Form 5471  
3. Schedule C: Income Statement:    • Schedule C: Income Statement - IRS Form 5471  
4. Schedule F: Balance Sheet:    • Schedule F: Balance Sheet - IRS Form 5471  
5. Schedule H: Current E&P:    • Schedule H: Current E&P - IRS Form 5471  
6. Schedule I & Worksheet A: Shareholder's Income from FC:    • Schedule I: Summary of Shareholder Income ...  
7. Schedule G: Other Information:    • Schedule G: Other Information - IRS Form 5471  
8. Schedule E: Income & Taxes Paid:    • Schedule E: Income Taxes Paid or Accrued -...  
9. Schedule E-1: Taxes Related to Type of Income:    • Schedule E-1: Taxes Paid or Deemed Paid - ...  
10. Schedule M: Related Party Transactions:    • Schedule M: Transactions with Related Part...  
11. Schedule I-1: GILTI:    • Schedule I-1: Global Intangible Low-Taxed ...  
12. Schedule J: E&P of Corporation:    • Schedule J: Accumulated E&P of CFC - IRS F...  
13. Schedule P: Previously Tax E&P of US Shareholder:    • Schedule P: Previously Taxed E&P of US Sha...  
14. Schedule Q: CFC Income by Groups:    • Schedule Q: CFC Income by Groups - IRS For...  
15. Schedule O: Organization & Stock Acquisition:    • Schedule O Part 1 & 2: Organization & Acqu...  
16. Category 3 Indebtedness Statement:    • Category 3: Indebtedness Statement - IRS F...  
17. Schedule R: Dividend Distributions:    • Schedule R: Distributions From Foreign Cor...  
18. Where to Report Subpart F Inclusion:    • Where to Report Subpart F Income - IRS For...  

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