If you own a U.S. corporation and you’re a foreign national or part of a foreign-owned business, there’s one form that could quietly cost you $25,000 if you miss it:
IRS Form 5472.
At Polaris Tax & Accounting, we’ve helped business owners across Plantation, Fort Lauderdale, and Miami who had no idea this form even existed—until the IRS dropped a penalty notice in their mailbox. Here’s what you need to know if you want to stay in compliance and avoid a brutal fine.
What Is Form 5472 and Who Must File It?
Form 5472 is an IRS information return required by U.S. corporations with at least 25% foreign ownership. It must be filed each year—often alongside the corporate tax return (Form 1120)—to disclose:
- Ownership details
- Transactions with related foreign parties
- Transfers of money, property, or services
Even if the corporation has no activity, the IRS still expects Form 5472 to be filed. That’s where many businesses go wrong.
📌 Learn more from the IRS here: https://www.irs.gov/forms-pubs/about-form-5472
What Happens If You Don’t File Form 5472?
The IRS imposes a $25,000 penalty per year for failing to file Form 5472 on time or omitting required information. If you ignore their follow-up letters, they can tack on an additional $25,000 for continued noncompliance.
We’ve seen clients penalized even when their businesses had no revenue or transactions—because their previous tax preparer never told them about the form.
Read one of our real cases here: https://polaristaxandaccounting.com/irs-penalty-foreign-owned-corporation
Common Mistakes That Trigger the Penalty
- Form 5472 not filed with a timely Form 1120
- Belief that a dormant corporation doesn’t need to file
- Using a preparer who doesn’t specialize in foreign-owned businesses
- Ignoring IRS letters requesting compliance
How Polaris Helps You Stay Compliant
We:
- Track Form 5472 deadlines with your Form 1120 filing
- Review your corporate ownership and related-party transactions
- Prepare and file accurate forms with proper documentation
- Represent you before the IRS if a penalty notice arrives
We’ve successfully helped clients remove penalties and, more importantly, prevent them through proactive planning.
📌 See how we handle IRS representation and penalty defense:
https://polaristaxandaccounting.com/services/irs-tax-problems
Florida Is a Hotspot for Foreign-Owned Entities
South Florida—especially Plantation, Fort Lauderdale, and Miami—is home to thousands of foreign-owned corporations. Unfortunately, many use tax preparers who are unfamiliar with U.S. international tax compliance.
Don’t let inexperience cost you tens of thousands. We work with:
- Foreign investors and entrepreneurs
- International e-commerce business owners
- Nonresident shareholders with U.S. entities
If your corporation has any non-U.S. ownership, talk to us before you file.
Schedule a Compliance Check-Up
Not sure if you’re at risk? Let’s take a look at your structure and last tax return. A 30-minute call could save you $25,000 or more.