Question
Form 5471 Worksheet A Doesn't stop at Line 10
Hello,
The instructions for Worksheet A explicitly requires all entries be in the functional currency. During calculations, it should stop at Line 10 if:
- Line 7 is smaller than Line 8 and (5% De minimis test)
- Line 7 is smaller than $1 million ($ 1 million test)
The client passes both tests; however, since the number in Line 7 is bigger than 1 million in local currency (much much less than $1,000,000) the program keeps going and calculating foreign personal holding company AND foreign base company income (there is no FBCI).
The program should convert the numbers to US dollars and make the judgement, but it doesn’t. Now, I can enter the values in USD, but this would be against the instructions and worksheet is transmitted along with the return. I am afraid it might cause confusion.
Any help in resolving this issue is greatly appreciated.
