About Form 1120, U S. Corporation Income Tax Return Internal Revenue Service

how to file 1120

Enter this income or loss on line 1 of Schedule K. Line 21 income is not used in figuring the excess net passive income or built-in gains taxes. See the instructions for line 22a for figuring taxable income for purposes of these taxes. If the limit applies, the corporation can deduct prepaid farm supplies that don’t exceed 50% of its other deductible farm expenses in the year of payment. The excess is deductible only in the year the corporation uses or consumes the supplies (other than poultry, which is deductible, as explained above). For exceptions and more details on these rules, see Pub. Prepaid farm supplies include expenses for feed, seed, fertilizer, and similar farm supplies not used or consumed during the year.