This summary provides a clear overview of the obligations and procedures that multinational enterprises must follow to comply with Country by Country Reporting in the United States, ensuring an accurate and comprehensive guide for tax compliance.

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General Requirements

• Reporting Entity: Multinational enterprises (MNEs) with consolidated revenue of $850 million or more in the immediately preceding fiscal year.
• Form: Must file Form 8975 (Country-by-Country Report) and Schedule A (Form 8975 Schedule A, Country-by-Country Report).

Filing Deadlines

• Filing Date: Form 8975 must be filed with the entity’s federal income tax return (Form 1120) by the due date, including extensions.
• Reporting Period: The report covers the fiscal year of the MNE group.

Required Information

• Aggregated Data by Country: Includes revenue, profit (or loss) before income tax, income tax paid, income tax accrued, stated capital, accumulated earnings, number of employees, and tangible assets other than cash and cash equivalents.
• Constituent Entities: Detailed information about each constituent entity within the MNE group, including name, country of incorporation, and main business activities.

Specific Instructions

• Form 8975: Detailed instructions on how to complete the form, what information to include, and how to file electronically.
• Schedule A of Form 8975: Instructions on how to break down the information by country and by constituent entity.

Filing Procedures

• Electronic Filing: Forms must be filed electronically through the IRS’s electronic filing system.
• Correcting Errors: If errors are identified after filing, they must be corrected by filing an amended form as soon as possible.

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Confidentiality and Use of Information

• Data Protection: The IRS keeps the reported information confidential and only shares it with foreign tax authorities under information exchange agreements.
• Data Use: The data is used to assess risks in transfer pricing policies and other tax risks of the MNE group.

Penalties for Non-Compliance

• Fines and Penalties: Failure to meet filing requirements can result in significant fines. Failure to file Form 8975 can lead to a penalty of $10,000 for each non-compliance.
• Defenses Against Penalties: In certain cases, reasonable cause defenses can be presented to mitigate penalties.

Applicable Regulations

• Primary Regulation: Section 6038 of the Internal Revenue Code (IRC), which sets out information reporting requirements for MNEs.
• Related Guidance: Instructions for Form 8975 and Schedule A available on the IRS website.
• International Agreements: Implementation of OECD guidelines under the BEPS (Base Erosion and Profit Shifting) Action 13 framework.

Additional Resources

• IRS Guides: Guides and FAQs available on the IRS website that provide additional details and practical examples.
• IRS Support: Direct contact with the IRS for specific questions regarding CbCR filing and compliance.