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Form 1120-IDP: 1120-IC-DISC (Schedule P)
IRS Form 1120-IC-DISC is a Schedule P used to compute the transfer price or commission for intercompany transactions under sections 994(a)(1) and (2), applying the 50% (0.50) combined taxable income and 10% (0.10) export promotion expense limits.
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IRS Form 1120-IDP - 1120-IC-DISC (Schedule P)
IRS Form 1120-IC-DISC is a Schedule P used to compute the transfer price or commission for intercompany transactions under sections 994(a)(1) and (2), applying the 50% (0.50) combined taxable income and 10% (0.10) export promotion expense limits.
Risk Radar
Scan points- 1Do not omit attaching a separate Schedule P for each transaction or group.
- 2Failing to check the box for Single transaction or Group of transactions.
- 3Leaving line 24 gross receipts blank when a transaction exists.
- 4Omitting reductions on lines 25a‑c, causing an incorrect line 25d total.
- 5Not subtracting line 25d from line 24, resulting in an inaccurate transfer price on line 26.
Plain English
Schedule P shows how an IC‑DISC calculates the price it pays a related supplier or the commission it receives. It breaks the calculation into two parts: the transfer price and the commission. You must fill out a separate schedule for each transaction or group of transactions.
Submission Date
- Filing date: 2017-09-16 08:02:48
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when you need to compute the transfer price or commission for an intercompany transaction subject to sections 994(a)(1) and (2).
- Do not use it when the section 482 arm’s length method is applied or when the transaction is incomplete.
- Check Form 1120-IC-DISC instead when filing the overall IC‑DISC corporate income tax return.
Form selector
Use this form or another form?
Using section 482 method
Schedule P must not be completed under the arm’s length method
✓ Verify the method before attaching Schedule P
Transaction incomplete (supplier has not resold property)
Incomplete transactions require recomputation later, not Schedule P now
✓ Confirm transaction completion before filing
Filing the overall IC‑DISC return
Schedule P is supplemental; the main return must be filed first
✓ Ensure Form 1120-IC-DISC is prepared and attached
Deadline or filing window
Not stated in the official source.
Checklist
What you need before filling it out
Line 18
Qualified export receipts amount · Schedule P line 18
Line 19
Result of multiplying line 18 by 4% · Schedule P line 19
Line 20
Result of multiplying line 2c by 10% · Schedule P line 20
Line 22
Combined taxable income from line 3 or special rule · Schedule P line 22
Line 30
IC‑DISC commission from related supplier (sum of lines 27‑29) · Schedule P line 30
Before you submit
- 1Verify the schedule is marked as Single transaction or Group of transactions as appropriate
- 2Enter the product or product line and Principal Business Activity code
- 3Confirm the amount on line 18 is correct
- 4Multiply line 18 by 4% and record the result on line 19
- 5Multiply line 2c by 10% and record the result on line 20
- 6Add lines 19 and 20 and enter the sum on line 21
- 7Enter combined taxable income on line 22 and check the special‑rule box if used
- 8Enter the smaller of line 21 or line 22 on line 23
- 9If applicable, sum lines 27‑29 and place total on line 30
How to file this form
- 1Calculate qualified export receipts and multiply by 4% to fill line 19 — proof: line 19 shows correct 4% amount
- 2Multiply export promotion expenses (line 2c) by 10% to fill line 20 — proof: line 20 shows correct 10% amount
- 3Add lines 19 and 20 and record the sum on line 21 — proof: line 21 matches addition
- 4Enter combined taxable income on line 22 (or apply special rule) and check the box if special rule used — proof: line 22 populated and box checked if needed
- 5Record the smaller of line 21 or line 22 on line 23 — proof: line 23 contains the lesser amount
- 6If applicable, sum lines 27‑29 and place total on line 30 — proof: line 30 reflects sum
- 7Attach the completed Schedule P to Form 1120‑IC‑DISC and mail to the IRS as instructed — proof: mailing receipt or electronic confirmation
Known limitations
- 1Not applicable when the section 482 arm’s length method is used
- 2Not applicable for incomplete transactions where the related supplier has not yet resold the property
- 3Not applicable if marginal costing rules are applied (requires different instructions)
Field map
Compact field-by-field guide
Entity Info
2 items
Full legal name of the corporation and its Employer Identification Number.
Current mailing address and date of incorporation.
Income
3 items
Total revenue from business operations before deducting costs.
Direct costs attributable to producing goods sold by the corporation.
Gross receipts minus cost of goods sold and returns/allowances.
Deductions
1 items
Sum of all business expenses including compensation, rent, interest, taxes, and depreciation.
Tax
2 items
Total income minus total deductions.
Tax calculated on taxable income using the applicable corporate tax rate, minus any credits.
Signatures
1 items
An authorized corporate officer must sign and date the return.
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Fillable formOpen in Editor->The form is Rev. September 2017; the source directs users to www.irs.gov/Form1120ICDISC for the latest information.
What changed or needs a fresh check
- Edition date — confirm the revision reads September 2017
- Fee — Not stated in the official source
- Mailing address — Not stated in the official source
- Signature — Not stated in the official source
- OMB number — confirm it is 1545-0123
Quick Facts
Downloads
Sources
- SRCForm p.1 — revision date reads Rev. September 2017
- SRCForm p.1 — instruction to attach a separate schedule for each transaction or group of transactions
- SRCForm p.1 — purpose: compute the transfer price or commission (Part II/III)
- SRCForm p.2 — do not complete Schedule P if the section 482 method is used
- SRCForm p.2 — do not complete Schedule P for incomplete transactions
- SRCForm p.2 — 50‑50 method limits: 50% of combined taxable income plus 10% of export promotion expenses
- SRCForm p.2 — 4% method limits: 4% of qualified export receipts plus 10% of export promotion expenses
- SRCForm p.2 — OMB No. 1545-0123 appears on the form
- SRCForm p.2 — line 18 multiplied by 4% (0.04) to produce line 19
- SRCForm p.2 — line 2c multiplied by 10% (0.10) to produce line 20
Common confusion points
Which method should I use, 50‑50 or 4%?
The form lists both methods with different percentage bases, leading to uncertainty
→ Review the method description on page 2 and select the one that matches your transaction
Is my transaction considered complete?
Incomplete transactions require recomputation later, but the form does not define completeness
→ Confirm that the related supplier has resold the property within the tax year
Can I use the section 482 method?
The form states Schedule P must not be completed if the section 482 method is used
→ Verify the pricing method before starting Schedule P
How do I group transactions?
The form allows grouping by product or product line but limits each group to one transaction type
→ Ensure all transactions in the group are of the same type (sales, leases, or commissions)
When do I apply the special rule on line 22?
The form mentions a special rule without detailing criteria
→ Check the instructions for the special rule and mark the box if applicable
What expenses belong in line 28?
Export promotion expenses are required, but the source does not define them fully
→ Use the definition from Regulations section 1.994‑1(f) for export promotion expenses
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- Form 1120-IC-DISC — amend the return using Form 1120-IC-DISC with a corrected Schedule P
Questions about IRS Form 1120-IDP
What is IRS Form 1120-IDP used for?
Schedule P shows how an IC‑DISC calculates the price it pays a related supplier or the commission it receives. It breaks the calculation into two parts: the transfer price and the commission. You must fill out a separate schedule for each transaction or group of transactions.
Who must file IRS Form 1120-IDP?
The IC‑DISC corporation filing Form 1120‑IC‑DISC must attach Schedule P.
What information does IRS Form 1120-IDP require?
Schedule P collects the corporation’s name, EIN, product line and principal business activity code, then computes Part II transfer price (lines 24‑26) and Part III commission (lines 27‑30).
How do I complete IRS Form 1120-IDP?
Enter the corporation’s name, EIN, product line and activity code at the top of Schedule P. Check whether the schedule covers a single transaction or a group of transactions. Complete Part II by entering gross receipts on line 24, reductions on lines 25a‑c, summing them on line 25d, and calculating the transfer price on line 26. Complete Part III by entering taxable income on line 27, export promotion expenses on line 28, other expenses on line 29, and summing to line 30. Attach a separate Schedule P for each transaction or group and sign the accompanying Form 1120‑IC‑DISC.
Which method should I use, 50‑50 or 4%?
The form lists both methods with different percentage bases, leading to uncertainty Review the method description on page 2 and select the one that matches your transaction
Is my transaction considered complete?
Incomplete transactions require recomputation later, but the form does not define completeness Confirm that the related supplier has resold the property within the tax year
Can I use the section 482 method?
The form states Schedule P must not be completed if the section 482 method is used Verify the pricing method before starting Schedule P
How do I group transactions?
The form allows grouping by product or product line but limits each group to one transaction type Ensure all transactions in the group are of the same type (sales, leases, or commissions)
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