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This course covers Part II of Schedule M-3 including filing and disclosure requirements for Income (Loss) items reported on the financial statements.  Completion of Part II requires the disclosure of detailed information regarding book-tax differences when reporting income (loss) items. 

In addition to determining how financial income (loss) items differ from how they are reported on the tax return, the differences must be reported as either a “temporary” difference or a “permanent” difference.  Also, in some cases, an income (loss) item must be separately disclosed, even when there is no book-tax difference.  Thus, it is important to “get the numbers right” when completing Part II of Schedule M-3.

This course covers the Schedule M-3, Part II filing and reporting requirements, including:

  • The four column reporting format for reconciling book income to taxable income.
  • Adequate and separate disclosure requirements for book-tax differences
  • Disclosure of common book-tax income differences
  • Disclosure of financial income items even when there is no book-tax difference.

After completing this course you will be better positioned to quickly and accurately complete Schedule M-3, a critical part of your company's corporate tax filing duties.

Note:  Part I was covered in a prior course and Part III is covered in subsequent courses.   Also, the Part II line items not covered in this course will be covered in a subsequent Advanced Topics course.

Course Series

This course is included in the following series:

7 CoursesReporting and Compliance for Book-Tax Differences

  1. Corporate Tax Filing: Schedule M-1 Disclosure of Book-Tax Differences on the Corporate Tax Return
  2. Corporate Tax Filing: Schedule M-3: Part I: Compliance and Reporting Issues
  3. Corporate Tax Filing: Schedule M-3: Part II: Compliance and Reporting Issues
  4. Corporate Tax Filing: Schedule M-3: Part III: Compliance and Reporting Issues
  5. Corporate Tax Filing: Schedule M-3: Additional Reporting in Parts II and III
  6. Corporate Tax Filing: Schedule M-3: Reporting Requirements for a Consolidated Group
  7. Corporate Tax Filing: Uncertain Tax Positions: Financial Accounting and Tax Reporting Requirements

Learning Objectives

  • Recognize which entities are required to file Schedule M-3.
  • Identify the basic financial information disclosure requirements.
  • Identify how to reconcile worldwide consolidated net income, line 4 to net income of includible 
  • Recognize the disclosure requirements for the total assets and liabilities of includible entities reported on line 12.
  • Discover how to reconcile retained earnings on Schedule M-2 using line 11, net income of includible corporations.    
Last updated/reviewed: February 05, 2018

3 Reviews (10 ratings)Reviews

5
Member's Profile
Detailed , informative examples made this course very good.
5
Anonymous Author
Great course! Loved the step by step instruction!
4
Anonymous Author
good content

Prerequisites

Course Complexity: Intermediate

No Advanced Preparation or Prerequisites are needed for this course. However, it is recommended to take the other courses in the series prior to completing this one.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Course Syllabus
INTRODUCTION AND OVERVIEW
Part II Compliance and Reporting Issues
  14:30Overview of Part 2
  10:50Line 13 to 17 Interest Income and Cost of Goods Sold
  8:10Tax Insight, Line 17 Cost of Goods Sold
  16:16Lines 23 - 24 Reporting Gains and Losses
CONCLUSION
  10:33Lines 27 Total Expense Deduction Carryover from Line 36 & 28 Income and Loss No Book/Tax Difference
Continuous Play
  1:04:123 Corporate Tax Filing Schedule M-3: Part II Compliance and Reporting Issues Full Video
SUPPORTING MATERIALS
  PDFSlides: Schedule M-3: Part II Compliance and Reporting Issues
  PDFSchedule M-3: Part II Compliance and Reporting Issues Glossary/Index
REVIEW & TEST
  quizREVIEW QUESTIONS
 examFINAL EXAM