1120

U.S. Personal Holding Company (PHC) Tax

Agency
IRS
Revision
Rev. November 2015
Fillable fields
114
Pages
2
Official source
IRS form page
Checked
October 21, 2026
Fill 1120 online
Page 1 of form 1120

Schedule PH (Form 1120): U.S. Personal Holding Company (PHC) Tax

Schedule PH (Form 1120) is used to figure the U.S. personal holding company (PHC) tax. The About page says a corporation that is a personal holding company uses it to figure the PHC tax, and the form says "Attach to tax return."

The instructions say a corporation is generally a PHC if it meets two tests: at least 60% of its adjusted ordinary gross income for the tax year is PHC income, and at any time during the last half of the tax year more than 50% in value of its outstanding stock is directly or indirectly owned by five or fewer individuals. Tax-exempt corporations, banks, life insurance and surety companies, foreign corporations and some others are not PHCs.

The instructions give a tax rate of 20% on undistributed PHC income. This page has the November 2015 revision. You can fill out the PDF free in your browser on this page and download it without an account.

What's on Schedule PH (Form 1120)

Part I: Undistributed PHC Income, lines 1 to 13

Starts from taxable income on Form 1120, line 28, adds back contributions and excess expenses, then subtracts taxes, contributions, a net operating loss, net capital gain and dividends paid.

Part II: PHC Income, lines 14 to 25

Dividends, interest, royalties, annuities, rents, mineral, oil and gas royalties, copyright royalties, produced film rents, compensation from a 25% or more shareholder, personal service contracts and estate or trust income.

Part III: PHC tax, line 26

The PHC tax, which the form figures as 20% of the undistributed PHC income on line 13.

Part IV: Stock ownership

Names and addresses of the individuals who together owned more than 50% in value of the stock during the last half of the tax year, with their highest percentage of preferred and common shares.

Part V: Excess expenses and depreciation

A property-by-property table of cost, depreciation, repairs and other expenses against rent or other compensation. The total excess goes to Part I, line 3.

Part VI: Dividends paid deduction

Taxable dividends paid, consent dividends with Forms 972 and 973 attached, and the dividend carryover. The total goes to Part I, line 9.

How to fill out Schedule PH (Form 1120)

  1. 1

    Run the PHC test

    The instructions say to complete Part I, then lines 1 to 5 of the Worksheet, then Part II and line 6 of the Worksheet. Line 6 divides Part II, line 25, by adjusted ordinary gross income.

  2. 2

    Part I

    Enter the amount from Form 1120, line 28, on line 1 and contributions from Form 1120, line 19, on line 2. Attach a schedule of the taxes on line 5. Line 12 holds dividends paid after year end that the corporation elects to treat as paid during the year.

  3. 3

    Part II

    Enter each type of PHC income. The instructions explain when rents, mineral, oil and gas royalties, copyright royalties, software royalties and produced film rents can be excluded.

  4. 4

    Parts IV, V and VI

    List the shareholders for the stock ownership test, the excess of expenses over rent for each property, and the dividends paid deduction. Attach Forms 972 and 973 for consent dividends.

  5. 5

    Part III

    Multiply line 13 by 20% and enter the result on line 26 and on Schedule J (Form 1120), line 8, or on the proper line of the appropriate tax return.

Why fill Form 1120 on indox

You get the real form, filled in a browser tab, with nothing standing between you and the finished PDF.

  • Fill the form right in your browser, no software to install
  • Free to fill and free to download, with no account
  • The official blank straight from the IRS, not a copy someone retyped
  • Works on a phone, tablet or computer

Where it goes and what to watch

Attach to the return

The form says "Attach to tax return." The instructions say a corporation that is a PHC files Schedule PH by attaching it to its income tax return.

Parts II and IV

The form notes that if Part II and Part IV are not submitted with the return, the limitation period for assessment and collection of the PHC tax is any time within 6 years after the return is filed.

Dividends paid after year end

For tax years beginning after December 31, 2015, the instructions say a corporation can elect to treat dividends paid before the 16th day of the 4th month after year end as paid during its tax year. Special rules apply to years ending in June.

Foreign tax credit

The instructions say the foreign tax credit is not allowed against PHC tax, but taxes paid to foreign countries and U.S. possessions can be deducted on line 5.

Related forms

Who files Schedule PH (Form 1120)?

  • Corporations that are PHCs

    A corporation that meets both the PHC income test and the stock ownership requirement attaches Schedule PH to its return. Line 26 carries to Schedule J (Form 1120), line 8, or the proper line of the appropriate return.

  • PHC income test

    At least 60% of adjusted ordinary gross income is PHC income, figured on the Worksheet in the instructions. The instructions say that if line 6 of the Worksheet is less than 60%, the corporation is not a PHC.

  • Stock ownership requirement

    More than 50% in value of the outstanding stock owned, directly or indirectly, by five or fewer individuals at any time during the last half of the tax year. Some plans, trusts and private foundations count as individuals.

  • Corporations that are not PHCs

    Tax-exempt corporations, banks and certain lending or finance companies, life insurance and surety companies, certain small business investment companies, corporations in a title 11 or similar case, and foreign corporations.

The instructions say a corporation that is a PHC files Schedule PH by attaching it to its income tax return. It is a corporate schedule, not a form for individuals.

Official sources and the blank

Do it all with indox

View all 123 tools

Questions about Form 1120

What is the PHC tax rate?

The instructions say the tax rate on undistributed personal holding company income is 20%. Line 26 multiplies Part I, line 13, by 20%.

When is Schedule PH not filed?

The Worksheet in the instructions says that if line 6 is less than 60%, the corporation is not a PHC and does not file Schedule PH.

Which corporations are not PHCs?

The instructions list tax-exempt corporations, banks and certain lending or finance companies, life insurance and surety companies, certain small business investment companies, corporations in a title 11 or similar case, and foreign corporations.

Who counts as an individual for the stock test?

The instructions list a qualified pension, profit-sharing or stock bonus plan under section 401(a), a section 501(c)(17) trust, a private foundation under section 509(a), and part of a trust set aside for the purpose in section 642(c).

What are consent dividends?

Part VI, line 2 lists consent dividends and says to attach Forms 972 and 973. Form 972 is the shareholder's consent to include a specific amount in gross income, and Form 973 is the corporation's claim for the deduction.

Which revision is this?

The PDF prints Rev. November 2015. The separate instructions on irs.gov are marked Revised 12/2016.