1120-US: Preparing Form 8903 for consolidated groups using EAG procedures (FAQ)

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Question

Do all consolidated groups follow the EAG procedures to prepare Form 8903?

Answer

Per IRC Regulation section 1.199-7, a consolidated group is treated as a single member of the EAG. If all members of an EAG are also members of the same consolidated group, the consolidated group will file only one Form 8903.

Alternatively, an expanded affiliated group can consist of consolidated group and non-consolidated group members. If an EAG includes corporations that are members of the same consolidated group and corporations that are not members of the same consolidated group, the DPAD is allocated among members of the EAG based on the ratio of each member's QPAI to the total QPAI of the EAG.

Related topic: 1120-US: Form 8903 - Domestic production deduction FAQs

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