U.S. Coporation Income Tax Return

Schedule PH (Form 1120), U.S. Personal Holding Company (PHC) Tax
(Rev. December 2006)
Purpose: This is the first circulated draft of the December 2006 revision of
Schedule PH (Form 1120) for your review and comments. The major changes
are discussed below.
TPCC Meeting: None, but may be arranged if requested.
Instructions: The 2006 instructions for Schedule PH (Form 1120) will be
circulated at a later date. The 2005 instructions are available at:
http://www.irs.gov/pub/irs-pdf/i1120sph.pdf
Other Products: Circulations of draft tax forms, instructions, notices, and
publications are posted at:
http://taxforms.web.irs.gov/draft_products.html
Comments: Please email, fax, call, or mail any comments by May 19, 2006.
Joan A. McAlpine
Tax Forms and Publications
SE:W:CAR:MP:T:B:R
Email: Joan.A.McAlpine@irs.gov
Phone: 202-622-3622

Major Changes to Schedule PH (Form 1120) (Rev. December 2006)
Schedule PH (Form 1120) is being changed from an annual schedule to a
continuous use schedule beginning with the December 2006 revision. All line
references are to 2006 tax forms. There are no major changes to Schedule PH.

3
TLS, have you
transmitted all R
text files for this
cycle update?

Date

I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

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

PRINTS: HEAD TO HEAD
INK: BLACK

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

SCHEDULE PH
(Form 1120)
Department of the Treasury
Internal Revenue Service

Name

Signature

O.K. to print
Revised proofs
requested

©

f
o
s
a
6
t
0
f
0
a
2
r
/
D /08
3
0

OMB No. 1545-0123

See separate instructions. Attach to tax return.

Employer identification number

Part I
1

2
3
4

Undistributed Personal Holding Company Income (see instructions)

Taxable income before net operating loss deduction and special deductions. Enter amount
from the appropriate line of the corporation’s tax return (e.g., line 28 of the 2006 Form
1120)
Contributions deducted in figuring line 1. Enter amount from the appropriate line of the
corporation’s tax return (e.g., line 19 of the 2006 Form 1120)
Excess expenses and depreciation under section 545(b)(6). Enter amount from Part V,
line 2
Total. Add lines 1 through 3

5

Federal and foreign income, war profits, and excess profits taxes not deducted in figuring
line 1 (attach schedule)
6 Contributions deductible under section 545(b)(2). See instructions for limitation
7 Net operating loss for the preceding tax year deductible under section 545(b)(4)
8a Net capital gain from Schedule D (e.g., line 13 of the 2006
8a
Schedule D (Form 1120))

Deductions

Date

U.S. Personal Holding Company (PHC) Tax

(Rev. December 2006)

Additions

Action

b Less: Income tax on this net capital gain (see section 545(b)(5))
8b
(attach computation)
9 Deduction for dividends paid (other than dividends paid after the end of the tax year).
Enter amount from Part VI, line 5

1
2
3
4
5
6
7

8c
9

10

Total. Add lines 5 through 9

10

11
12

Subtract line 10 from line 4
Dividends paid after the end of the tax year (other than deficiency dividends defined in
section 547(d)), but not more than the smaller of line 11 or 20% of Part VI, line 1
Undistributed PHC income. Subtract line 12 from line 11.

11

13

12
13

Note: If the information in Part II and Part IV is not submitted with the return, the limitation period for assessment and
collection of the PHC tax is any time within 6 years after the return is filed. See section 6501(f).
Part II
14
15a
b
16
17
18a
b
19a
b
20
21
22
23
24
25

14

Dividends
15a
Interest
15b
Less: Amounts excluded (attach schedule)
Royalties (other than mineral, oil, gas, or copyright royalties)
Annuities
18a
Rents
18b
Less: Adjustments to rents (attach schedule)
19a
Mineral, oil, and gas royalties
Less: Adjustments to mineral, oil, and gas royalties (attach
19b
schedule)
Copyright royalties
Produced film rents
Compensation received for use of corporation property by 25% or more shareholder
Amounts received under personal service contracts and from their sale
Amounts includible in taxable income from estates and trusts
PHC income. Add lines 14 through 24

Part III
26

Personal Holding Company Income (see instructions)

15c
16
17
18c

19c
20
21
22
23
24
25

Tax on Undistributed Personal Holding Company Income

PHC tax. Enter 15% of line 13 here and on the appropriate line of the corporation’s tax return
(e.g., line 8 of the 2006 Schedule J (Form 1120))

For Privacy Act and Paperwork Reduction Act Notice, see the Instructions for
Forms 1120 and 1120-A.

Cat. No. 11465P

26

Schedule PH (Form 1120) (Rev. 12-2006)

3
I.R.S. SPECIFICATIONS

TO BE REMOVED BEFORE PRINTING

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

PRINTS: HEAD TO HEAD

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

Page 2
Stock Ownership Requirement Under Section 542(a)(2)
Enter the names and addresses of the individuals who together owned, directly or indirectly, at any time
during the last half of the tax year, more than 50% in value of the outstanding stock of the corporation.

Schedule PH (Form 1120) (Rev. 12-2006)

Part IV

(a) Name

f
o
s
a
6
t
0
f
0
a
2
r
/
D /08
3
0

Highest percentage of shares
owned during last half of tax year

(b) Address

(c) Preferred

1

2

Add the amounts in columns (c) and (d) and enter the totals here

Part V

©

(d) Common

%

%

%

%

%

%

%

%

%

%

%

%

Excess of Expenses and Depreciation Over Income From Property Not Allowable
Under Section 545(b)(6) (see instructions for Part I, line 3)

(a) Description of
property

(b) Date
acquired

(c) Cost or
other basis

(d) Depreciation
deduction

(e) Repairs,
insurance, and
other expenses
(section 162)
(attach schedule)

(f) Total of
columns (d)
and (e)

(g) Income from
rent or other
compensation

(h) Excess
(col. (f) less
col. (g))

1

2

Total excess of expenses and depreciation over rent or other compensation. Add the amounts in column
(h). Enter the total here and on Part I, line 3
Note: Attach a statement showing the names and addresses of persons from whom rent or other
compensation was received for the use of, or the right to use, each property.

Part VI
1

Deduction for Dividends Paid Under Sections 561 and 562

Taxable dividends paid. Do not include dividends considered as paid in the preceding tax
year under section 563 or deficiency dividends as defined in section 547

1

2

Consent dividends. Attach Forms 972 and 973

2

3

Taxable distributions. Add lines 1 and 2

3

4

Dividend carryover from first and second preceding tax years. Attach computation

4

5

Deduction for dividends paid. Add lines 3 and 4. Enter the total here and on Part I,
line 9

5

Schedule PH (Form 1120) (Rev. 12-2006)

Printed on recycled paper