IRS Form 5472: Filing requirements, instructions, and penalties

Written by  Andrew Coleman, CPA

Last updated Apr 30, 2026

IRS Form 5472 is an information return required under IRC §6038A and §6038C. A US corporation with 25% or more foreign ownership – and any foreign-owned single-member LLC classified as a disregarded entity – must file Form 5472 for each tax year in which reportable transactions occur with a related party. The IRS updated Form 5472 instructions in December 2024.

Failure to file a complete and correct Form 5472 can trigger a $25,000 penalty for each missed form. If the failure continues beyond 90 days after IRS notice, an additional $25,000 applies for each 30-day period, with no maximum continuation penalty.

If you're a foreign owner of a US company or a foreign entity doing business in the US, you'll need this form to report certain financial transactions to the IRS.

This guide covers who must file, which transactions count, and how to get the paperwork right. Your broader foreign company tax reporting obligations in the United States may require additional filings depending on your structure.

What is IRS Form 5472?

Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a US Trade or Business, plays a key role in ensuring tax compliance. It documents financial transactions between US corporations or foreign corporations engaged in US trade or business and their foreign shareholders.

On this form, you need to provide information required under IRC §6038A and §6038C of the Internal Revenue Code when reportable transactions occur with a foreign or domestic related party. §6038A applies to domestic corporations with 25% or more foreign ownership; §6038C applies to foreign corporations engaged in US trade or business – both are covered in the IRS Instructions for Form 5472.

Who must file Form 5472?

A US corporation with at least one direct or indirect 25% foreign shareholder must file Form 5472 for each tax year in which reportable transactions occur with a foreign or domestic related party (IRC §6038A(a)). Foreign-owned single-member LLCs classified as disregarded entities are treated as domestic corporations solely for Form 5472 purposes under Treas. Reg. §1.6038A-1(c), effective for tax years beginning on or after January 1, 2017.

The following 2 entity types must file Form 5472:

1. 25% foreign-owned US corporations – any US corporation with at least 25% of its shares owned by a foreign person at any point during the tax year
2. Foreign corporations engaged in US trade or business with reportable transactions during the tax year

Foreign owners of US disregarded entities (like single-member LLCs) must also file Form 5472 along with a pro forma Form 1120, regardless of US tax obligations. Even if the LLC generates no income, these forms are required to disclose ownership and related-party transactions.

Foreign corporations with US operations may also have obligations under Form 1120-F.

Foreign-owned LLCs and disregarded entities

A foreign-owned single-member LLC classified as a US disregarded entity must file Form 5472 attached to a pro forma Form 1120 – a structural placeholder return filed solely to satisfy the attachment requirement under Treas. Reg. §1.6038A-1(c). The LLC owes zero corporate income tax; Form 1120 is a filing requirement, not a tax return.

The pro forma Form 1120 requires the LLC name, address, and EIN on the first page. The notation "Foreign-owned US DE" must be written across the top of both Form 1120 and Form 7004.

Many foreign LLC owners assume that a zero-revenue entity with no US tax liability has nothing to report. A single capital contribution from the foreign owner is enough to trigger the full Form 5472 filing obligation.

Filing mechanics for foreign-owned LLCs

The following 5 rules apply exclusively to foreign-owned single-member LLCs filing Form 5472:

1. Attach Form 5472 to a pro forma Form 1120 – the LLC owes zero corporate tax; Form 1120 is a structural requirement only
2. Electronic filing is not available – the IRS accepts only mail or fax
3. Mail to: Internal Revenue Service, 1973 Rulon White Blvd, M/S 6112, Attn: PIN Unit, Ogden, UT 84201; or fax (300 DPI minimum) to 855-887-7737 (IRS Instructions, December 2024)
4. Deadline: April 15, 2026, for the 2025 tax year; extended to October 15, 2026 via Form 7004 – the automatic June 15 expat extension for individual returns does not apply to this filing
5. Form 7004 for an LLC must be sent to the same special fax/mail address – do not use the standard Form 7004 filing address

What counts as a reportable transaction for an LLC

The IRS requires foreign-owned LLCs to report under Part V of Form 5472 any transaction not already covered in Part IV, including amounts paid or received in connection with formation, dissolution, acquisition, disposition, contributions, and distributions.

The following 7 are the most common transaction types:

1. Initial capital contribution from the foreign owner
2. Additional equity injections or capital contributions
3. Distributions or withdrawals to the foreign owner
4. Loans from the foreign owner to the LLC
5. Loans from the LLC to the foreign owner
6. Payments for services between the LLC and the foreign owner
7. Transfers of property between the LLC and the foreign owner

What triggers the filing requirements for Form 5472?

Form 5472 must be filed when a reporting corporation enters into a reportable transaction with a related party during the tax year – meaning any exchange of money, property, or services as defined under IRC §6038A(b). Only transactions involving a related party as defined by the IRS qualify; incorrect identification of related parties is one of the most common Form 5472 compliance errors.

There is no dollar threshold: a single $1 transaction with a related party triggers the full filing requirement.

Reportable transactions

The following 5 categories of monetary transactions must be reported in Part IV of Form 5472.

1. Sales or purchases of tangible property
2. Sales or purchases of intangible property
3. Loans and interest payments
4. Rent and royalty payments
5. Other transactions affecting taxable income

Only those transactions that involve related parties, as defined by the IRS, are reportable. The IRS has strict rules about who qualifies as a related party, and failing to properly identify relationships can result in an inaccurate Form 5472.

Example scenarios

The following TFX client scenarios illustrate the most common situations that trigger – or do not trigger – a Form 5472 filing obligation.

TFX client scenario 1: A US e-commerce company with a 30% German shareholder paid that shareholder $85,000 for marketing services in 2025 – triggering a Form 5472 filing requirement under IRC §6038A. The shareholder meets the 25% foreign shareholder threshold, and the service payment qualifies as a reportable transaction.

TFX client scenario 2: A German corporation with US operations paid $120,000 in royalties to its US subsidiary for intellectual property usage in 2025. As a foreign corporation engaged in US trade or business with reportable transactions, it must file Form 5472 under IRC §6038C.

TFX client scenario 3: A US corporation with 25% foreign ownership paid $50,000 in dividends to its foreign owner. Dividend payments are not among the monetary transactions listed in Part IV of Form 5472, so no filing was triggered on that basis – though withholding obligations may apply separately under Form 1042 depending on the circumstances.

What's the difference between Form 5472 and Form 5471?

Form 5472 and Form 5471 are both used to report foreign transactions, but they serve different purposes and apply to different groups of US taxpayers.

Form 5472 reports inbound foreign investment into the US – a foreign person owning a US entity (IRC §6038A); Form 5471 reports outbound US investment abroad – a US person owning a foreign entity (IRC §6038). The two forms cover opposite ownership directions and are never interchangeable.

A full breakdown of the rules that apply on the other side of the ownership equation is covered in the Form 5471 guide for US taxpayers with foreign interests.

Form 5472 filing deadline

Form 5472 is due on the same date as the reporting corporation's income tax return (IRC §6038A(a)). For US corporations and calendar-year filers, the primary deadline is April 15, 2026.

Deadlines vary by entity type – foreign corporations filing Form 1120-F follow different rules depending on whether they maintain a US office. An automatic 6-month extension is available via Form 7004 – no IRS approval or explanation is required.

Filing deadlines and submission methods differ by entity type; foreign-owned LLCs cannot use the standard Form 1120 mailing address and must file by mail or fax only.

The automatic June 15 extension that applies to individual Form 1040 returns does not extend to corporate returns or foreign-owned LLC pro forma Form 1120 filings.

Extension: How to use Form 7004

Form 7004 grants a 6-month automatic extension to file Form 5472 with no IRS approval required. For US corporations and foreign-owned LLCs, filing Form 7004 by April 15, 2026, extends the deadline to October 15, 2026. Foreign corporations without a US office filing Form 1120-F must file Form 7004 by June 15, 2026, extending the deadline to December 15, 2026.

The extension applies to the filing deadline only – not to any tax payment obligation. For foreign-owned LLCs, enter the Form 1120 code in Part I, line 1 of Form 7004, and write "Foreign-owned US DE" across the top. Send Form 7004 to the same special address (fax 855-887-7737 or M/S 6112, Ogden, UT) – not to the standard Form 7004 filing address.

Form 5472 instructions: How to file

Form 5472 is filed as an attachment to the reporting corporation's annual income tax return – Form 1120 for US corporations, Form 1120-F for foreign corporations, or a pro forma Form 1120 for foreign-owned LLCs. The IRS released updated Form 5472 instructions in December 2024; filers should verify all Part IV and Part V requirements against the current revision before submitting.

Prepare to file

Before diving into the form, ensure you have all the necessary information and documents at hand:

• The reporting corporation's name, address, and EIN
• Details of the foreign shareholder(s), including name, address, and country of citizenship
• Detailed information on all reportable transactions during the tax year

Fill out the form

Provide detailed information about the reporting corporation, the related foreign person, and each reportable transaction.

The form is divided into multiple parts, each requiring specific information:

• Part I asks for information about the reporting corporation
• Part II focuses on the 25% foreign shareholder details
• Part III and subsequent sections require details about the reportable transactions, broken down by type and amount

Exceptions and special cases

IRS Instructions (December 2024) list the following 6 exceptions from filing Form 5472 – note that exceptions 2, 3, and 6 explicitly do not apply to foreign-owned disregarded entities (LLCs):

1. No reportable transactions of the types listed in Parts IV, V, or VI occurred during the tax year – for LLCs, capital contributions from the foreign owner count as Part V transactions
2. A US person controlling the related foreign corporation files Form 5471 with Schedule M covering all reportable transactions – does not apply to foreign-owned DEs
3. The related corporation qualifies as a Foreign Sales Corporation filing Form 1120-FSC – does not apply to DEs
4. Foreign corporation with no US permanent establishment under an applicable income tax treaty, timely filing Form 8833
5. Foreign corporation whose gross income is entirely exempt under IRC §883, timely complying with sections 883 and 887 reporting requirements
6. Both the reporting corporation and related party are non-US persons and their transactions will not generate US-source gross income – does not apply to DEs

A foreign-owned LLC qualifies only for exception 1 (no reportable transactions). Because any capital contribution from the foreign owner is a Part V reportable transaction, a newly formed LLC that received only its initial funding must still file Form 5472.

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Penalties for Form 5472 non-compliance & how to avoid them

The IRS assesses a $25,000 penalty for each Form 5472 that is not filed or is substantially incomplete (IRC §6038A(d)(1)). Because a separate Form 5472 is required for each related party, a reporting corporation with 3 foreign related parties faces a potential $75,000 initial penalty exposure. There is no statutory maximum cap on continuation penalties.

The IRS penalty structure operates in two phases. Phase 1: $25,000 per form, assessed immediately upon missing the filing deadline or submitting an incomplete return. Phase 2: an additional $25,000 for each 30-day period (or fraction thereof) that the failure continues after a 90-day written IRS notice period.

In an affiliated group, each member is treated as a separate reporting corporation subject to a separate $25,000 exposure. Each member is jointly and severally liable for the group total.

The IRS may waive penalties upon submission of a written statement showing the failure was not due to willful neglect. Criminal penalties under IRC §§7203, 7206, and 7207 may additionally apply for failure to provide required information or for submitting false information.

TFX client scenario: A foreign-owned Delaware LLC missed the April 15 deadline, received an IRS written notice in July, and did not respond within 90 days. The IRS assessed $25,000 (initial penalty) + $25,000 (one 30-day period after the notice period) = $50,000 total for a single Form 5472 filing.

There are several ways to alleviate or avoid penalties. The following 4 relief options may apply depending on your circumstances:

• First-time penalty abatement (FTA): FTA is generally not available for Form 5472 penalties. The IRS notes only limited exceptions for certain systemically assessed Form 5472 penalties
• Delinquent international information return submission procedures: Taxpayers not under criminal or IRS investigation can submit delinquent returns with a reasonable cause statement
• Streamlined filing compliance procedures: For taxpayers whose failure to report was not willful, this provides an efficient process for resolving tax and penalty obligations
• Reasonable cause: To request penalty relief, provide a clear explanation of the circumstances backed by relevant documentation

The IRS requires corporations to maintain records of all reportable transactions as long as they may be relevant for determining tax liability – typically at least 7 years after the filing date. Taxpayers who missed the filing deadline may qualify for relief through the IRS penalty relief procedures for Forms 5471, 5472, and 8865.

Get expert assistance with your Form 5472 filing

Whether you're a foreign owner of a US LLC, a US corporation with foreign shareholders, or engaged in cross-border transactions, timely and accurate Form 5472 filing can prevent costly penalties and ensure smooth tax reporting.

Taxes for Expats specializes in international business tax compliance, including Form 5472 filings, pro forma Form 1120 packages for foreign-owned disregarded entities, and related-party transaction documentation. Reach out to a tax professional at TFX for personalized advice and step-by-step guidance through the process.

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