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Form 1120-SF: U.S. Income Tax Return for Settlement Funds (Under Section 468B)
IRS Form 1120-SF is the U.S. Income Tax Return for Settlement Funds (Under Section 468B). All section 468B designated and qualified settlement funds must file this annual return to report transfers received, income earned, deductions claimed, and distributions made, and to figure income tax liability. The minimum penalty for failure to file more than 60 days late is the lesser of tax due or $525 (adjusted for inflation).
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IRS Form 1120-SF - U.S. Income Tax Return for Settlement Funds (Under Section 468B)
IRS Form 1120-SF is the U.S. Income Tax Return for Settlement Funds (Under Section 468B). All section 468B designated and qualified settlement funds must file this annual return to report transfers received, income earned, deductions claimed, and distributions made, and to figure income tax liability. The minimum penalty for failure to file more than 60 days late is the lesser of tax due or $525 (adjusted for inflation).
Risk Radar
Scan points- 1Failure to file on time may trigger a minimum penalty of $525.
- 2Using an outdated revision (must use December 2025 revision).
- 3Filing without the administrator's signature and date.
- 4Mailing to an IRS P.O. box via a private delivery service.
- 5Underpaying estimated tax installments without filing Form 2220.
Plain English
This form is used by settlement funds to tell the IRS about money they got, income they earned, expenses they paid, and money they gave out. It also calculates how much tax the fund owes. The fund must file by the 15th day of the 4th month after its tax year ends, or by the 15th day of the 3rd month if the tax year ends on June 30.
Submission Date
- Filing date: 2025-12-16 08:10:42
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form to report transfers received, income earned, deductions claimed, and distributions made, and to figure the income tax liability of a designated or qualified settlement fund under section 468B.
- Do not use this form for funds that are not designated or qualified settlement funds under section 468B.
- Check Form 7004 instead when requesting an extension of time to file.
Form selector
Use this form or another form?
Fund underpaid estimated tax
To determine if a penalty for underpayment of estimated tax is owed and to compute the amount.
✓ The IRS can compute the penalty and bill the fund; filing Form 2220 is optional unless the fund wants to compute it.
Trust fund recovery penalty may apply
To report and pay excise, income, social security, and Medicare taxes that were not collected or withheld.
✓ See the Instructions for Form 720 or Pub. 15 for definitions of responsible persons.
Fund is a section 468B designated or qualified settlement fund
This is the required annual income tax return to report transfers, income, deductions, distributions, and tax liability.
✓ Use the December 2025 revision for tax years beginning after 2025.
Deadline or filing window
The return is generally due by the 15th day of the 4th month after the end of the fund's tax year. If the tax year ends on June 30, the due date is the 15th day of the 3rd month after the end of the tax year. A short tax year ending in June is treated as ending on June 30. An automatic extension of time to file can be obtained by filing Form 7004 by the regular due date.
Checklist
What you need before filling it out
Line 1 - Transfers received
List of all transfers of money or property received · Fund's records, court orders
Line 2 of Additional Information - Tax-exempt interest
Amount of tax-exempt interest (including OID) received · Fund's records, brokerage statements
Line 17 - Penalty for underpayment of estimated tax
Form 2220 if penalty is owed · IRS Form 2220 instructions
Line 18 - Tax due
Full payment of tax due · Fund's financial records
When to file - Due date
Tax year end date · Fund's accounting records
Where to file - Address
Principal business location (US or foreign) · Fund's records
Before you submit
- 1Confirm the form revision is December 2025.
- 2Enter the fund's EIN or write 'Applied For' with the application date.
- 3Fill in the fund name, address, and administrator details accurately.
- 4Check the appropriate box: final return, name change, address change, or amended return.
- 5Complete Part I Income lines 1–3, attaching Schedule D (Form 1120) if capital gains exist.
- 6Compute the tax liability and enter on line 18.
- 7If attaching Form 2220, check the box on line 17 and enter the penalty amount.
- 8Sign and date the return as the fund administrator.
- 9Make electronic payment of any tax due by the due date (excluding extensions).
- 10File the return by the 15th day of the 4th month after the tax year end (or 3rd month for June 30 year-end).
- 11Keep a copy of the filed return and all attachments for your records.
How to file this form
- 1Obtain the December 2025 revision of Form 1120-SF and instructions.
- 2Apply for an EIN if the fund does not have one (use Form SS-4 or online at IRS.gov/EIN).
- 3Complete the fund name, EIN, address, and administrator information.
- 4Check applicable boxes: final return, name change, address change, or amended return.
- 5Report income in Part I: taxable interest, dividends, and capital gains (attach Schedule D if needed).
- 6Compute the tax liability and enter on line 18; attach Form 2220 if applicable.
- 7Sign and date the return as the fund administrator.
- 8File the return by the due date and pay any tax due electronically.
Known limitations
- 1Does not apply to funds that are not designated or qualified settlement funds under section 468B.
- 2Does not apply to funds that do not meet the governmental order or approval requirement.
- 3Does not apply to funds that do not meet the segregation requirement (funds must be separate from the transferor).
- 4Does not apply to funds that are not resolving or satisfying claims as defined in the instructions.
Field map
Compact field-by-field guide
Entity Info
2 items
Full legal name of the corporation and its Employer Identification Number.
Current mailing address and date of incorporation.
Income
3 items
Total revenue from business operations before deducting costs.
Direct costs attributable to producing goods sold by the corporation.
Gross receipts minus cost of goods sold and returns/allowances.
Deductions
1 items
Sum of all business expenses including compensation, rent, interest, taxes, and depreciation.
Tax
2 items
Total income minus total deductions.
Tax calculated on taxable income using the applicable corporate tax rate, minus any credits.
Signatures
1 items
An authorized corporate officer must sign and date the return.
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Fillable formOpen in Editor->The current revision of IRS Form 1120-SF is December 2025. The IRS provides updates at IRS.gov/Form1120SF; no specific changes beyond the penalty increase are mentioned in the source.
What changed or needs a fresh check
- Edition date — confirm the form revision is December 2025.
- Fee — no fee is mentioned in the official source for filing this form.
- Mailing address — not stated in the official source; verify on the IRS website or use the address from the Instructions for Form 1120.
- Signature — must be signed and dated by the administrator of the fund.
- EIN — enter the fund's EIN, or write 'Applied For' with the application date if not yet received.
- Payment — tax due must be paid electronically by the due date (excluding extensions).
Quick Facts
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After you file
- 1Retain a copy of the filed return and all attachments for at least 3 years.
- 2Monitor for IRS notices or requests for additional information.
- 3If an amended return is needed, file a new Form 1120-SF with the 'Amended return' box checked.
- 4If the fund applied for an EIN, follow up to receive the EIN and update records.
- 5Confirm that electronic payment of tax due was accepted by the IRS.
- 6If an extension was filed, ensure the return is submitted by the extended due date.
- 7Check the IRS website (IRS.gov/Form1120SF) for any updates or changes to the form or instructions.
Sources
- SRCInstructions p.1 — filing deadline is 15th day of 4th month after tax year end (3rd month for June 30 year-end).
- SRCInstructions p.1 — extension of time to file using Form 7004.
- SRCInstructions p.1 — penalty for failure to file more than 60 days late is lesser of tax due or $525.
- SRCInstructions p.1 — who must file: all section 468B designated and qualified settlement funds.
- SRCInstructions p.1 — purpose of form: report transfers, income, deductions, distributions, figure tax liability.
- SRCInstructions p.5 — EIN entry: enter fund's EIN or 'Applied For' with date.
- SRCInstructions p.6 — tax due must be paid electronically by due date.
- SRCForm p.1 — form title and revision date December 2025.
- SRCForm p.1 — check boxes for final return, name change, address change, amended return.
- SRCInstructions p.3 — definition of qualified settlement fund: governmental order, resolve claims, segregation.
Common confusion points
When is the due date for a fiscal year ending June 30?
The general rule says 15th day of 4th month, but there is a special rule for June 30 year-end.
→ Check the instructions: for fiscal year ending June 30, file by the 15th day of the 3rd month after the end of the tax year.
Where do I file if the fund is located outside the United States?
The instructions provide two addresses: one for US and one for foreign.
→ Use the address: Internal Revenue Service Center, P.O. Box 409101, Ogden, UT 84409 for foreign or U.S. territory.
What is the minimum penalty for filing more than 60 days late?
The penalty increased for returns required to be filed after 2025.
→ The minimum penalty is the lesser of tax due or $525 (adjusted for inflation).
Can I pay the tax due by check?
The instructions state that payment must be made electronically.
→ Use EFTPS or the same-day wire payment option via FTCS; do not mail a check.
Do I report tax-exempt interest on line 1?
It might be tempting to include all interest income on line 1.
→ Report tax-exempt interest on line 2 of Additional Information, not on line 1.
What is a designated settlement fund?
The term is defined in the instructions but may be confused with other types of funds.
→ A designated settlement fund is established for the principal purpose of resolving claims arising from personal injury, death, or property damage, and the taxpayer elects treatment under section 468B.
Can I attach extra sheets to the return?
The instructions allow attachments but have specific formatting requirements.
→ Attach separate sheets using the same size and format as the printed forms, arrange in order, and enter the fund's name and EIN on each.
Workflow map
Related forms and next steps
Current
After
Often used with
⚠ If something goes wrong
- Form 1120-SF (amended return) — check the 'Amended return' box to correct a previously filed return.
Questions about IRS Form 1120-SF
What is IRS Form 1120-SF used for?
This form is used by settlement funds to tell the IRS about money they got, income they earned, expenses they paid, and money they gave out. It also calculates how much tax the fund owes. The fund must file by the 15th day of the 4th month after its tax year ends, or by the 15th day of the 3rd month if the tax year ends on June 30.
Who must file IRS Form 1120-SF?
All section 468B designated and qualified settlement funds must file Form 1120-SF annually.
What information does IRS Form 1120-SF require?
The form collects information on transfers received, income earned, deductions claimed, and distributions made. It also calculates the fund's income tax liability, with specific lines for estimated tax penalty (line 17) and tax due (line 18).
When is IRS Form 1120-SF due?
Generally, the return is due by the 15th day of the 4th month after the end of the fund's tax year. For a fiscal year ending June 30, or a short tax year ending in June, the due date is the 15th day of the 3rd month after the tax year end. An extension can be requested by filing Form 7004 by the regular due date.
How do I complete IRS Form 1120-SF?
Enter the fund's tax year, true name, address, and EIN at the top. Report transfers received, income, deductions, and distributions in the appropriate sections. Figure the tax liability and any penalty on line 17. The administrator must sign and date the return. Attach Form 2220 if the fund owes an underpayment penalty.
What happens if IRS Form 1120-SF is filed incorrectly?
Failure to file on time may result in a minimum penalty of $525 (adjusted for inflation) if the return is more than 60 days late. Interest is charged on taxes paid late, even if an extension is granted.
When is the due date for a fiscal year ending June 30?
The general rule says 15th day of 4th month, but there is a special rule for June 30 year-end. Check the instructions: for fiscal year ending June 30, file by the 15th day of the 3rd month after the end of the tax year.
Where do I file if the fund is located outside the United States?
The instructions provide two addresses: one for US and one for foreign. Use the address: Internal Revenue Service Center, P.O. Box 409101, Ogden, UT 84409 for foreign or U.S. territory.
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