Where do I report dividends paid on Form 5471 Schedule C or Schedule F

Typically, it's buried in the difference between Line 20a and 20b on Schedule F.

That was what I assumed. Thanks for the corroboration.

Tony

The dividends paid would also be shown on Schedule M.

True, that's there on Schedule M, line 21, but it's only true for category 4 filers.

Tony

By the way... the word "Typically" in my response was meant to imply that GAAP says it is reflected in the retained earnings delta. I have no idea how a foreign corporation operating out of a foreign country with accounting procedures not consistent with US GAAP accounted for it.

Note that if the foreign corporation is not controlled by U.S. persons and you are not a category 4 filer, then you need to assess whether the foreign corporation is a passive foreign investment company (PFIC). If it is a PFIC, then you may want to make a qualified electing fund (QEF) election or a mark-to-market election.

Because of the cash holding to keep the company solvent, it looks like I'm caught by the PFIC rules, and therefore have to fill out form 8261. However dividends haven't been over the excess level, except by a few hundred dollars due to foreign exchange rate movements.

As a result, it looks like it's best not to go with the QEF election.

So, when I go back and allocate the excess on a gain, it says that I should use the highest rate of tax under section 1 or section 11 for a given year.

Where would I find the tax rates applicable for a given year? Are they in the 1040 instructions for each year?

Tony

If you don't make the QEF election you may be effectively converting capital gain into ordinary income. Other adverse consequences may also apply.

Yes, the section 1 rates are in the tax tables. For individuals the section 1 rates apply.