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A 1120 tax form is an Internal Revenue Service (IRS) form that corporations use to find out their tax liability, or how much business tax they owe. It is also called the U.S. Corporation Income Tax Return. American corporations use this form to report to the IRS their income, gains, losses deductions and credits.
Completing a Schedule L In the first part of the schedule, enter assets such as cash, accounts receivable, investments and buildings. Next, enter liabilities such as accounts payable and wages owed. Last, enter the net income for the year and stockholders equity.
Schedule L (Form 990) is used by an organization that files Form 990 or 990-EZ to provide information on certain financial transactions or arrangements between the organization and disqualified person(s) under section 4958 or other interested persons.
When Schedule L is required: If the corporation does NOT meet both requirements set forth in Schedule B (Form 1120S), Line 11, the corporation is required to complete Schedule L and enter the balance sheet as reflected on the corporations books and records.
Purpose of Schedule Schedule L (Form 990) is used by an organization that files Form 990 or 990-EZ to provide information on certain financial transactions or arrangements between the organization and disqualified person(s) under section 4958 or other interested persons.
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Schedule L is only used by taxpayers who are increasing their standard deduction by reporting state or local real estate taxes, taxes from the purchase of a new motor vehicle, or from a net disaster loss reported on Form 4684.
C corporations use Form 1120 to calculate their taxes due. S corporations use Form 1120S as an information return. S corporations must also prepare a form 10 K-1 for each shareholder to include with their individual returns.
However, Schedule L (the balance sheet) reflects the partnerships books and records and does not have to be tax basis.
If the corporations total receipts for the tax year AND total assets at the end of the tax year less than $250,000, Schedules L and M-1 are not required.
Basically, a Schedule L - Balance Sheet contains the Assets which equals the Liabilities and Equity (Capital Stock, Paid in Capital and Retained Earnings) that existed in the corporation on the first and last day of the tax year.

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