IRS, Treasury Issue Instructions for New Corporate Tax Return
Schedule M-3 is effective for any taxable year ending on or after December 31, 2004. In general, Schedule M-3 must be filed by a corporation required to file Form 1120, U.S. Corporation Income Tax Return, that reports on Form 1120 at the end of the corporation’s taxable year total assets that equal or exceed $10 million. However, a corporation is only required to complete certain sections of Schedule M-3 in the first taxable year the corporation is required to file the schedule.
The final instructions to Schedule M-3 provide additional guidance to those corporations required to file the schedule, including detailed instructions for almost every line and many illustrative examples. The Treasury and IRS believe that the additional guidance and examples will significantly assist in completion of the schedule.
The final Schedule M-3 instructions and final draft Schedule M-3 are attached and may be accessed on www.irs.gov. The final Schedule M-3  will also be available on IRS' Web site when it is released.