An Interactive Guide to Consolidated Tax Returns
Understand the requirements, benefits, drawbacks, and calculations of filing a single tax return for an affiliated group of corporations.
Are You Eligible?
Filing a consolidated return is a privilege, not a right. This quick check will help you determine if your corporate group might qualify based on the core requirements.
1. Is the group composed of eligible corporation types?
2. Is there a common parent corporation that directly owns stock in at least one other corporation in the group?
3. Does the common parent own at least 80% of the total voting power AND 80% of the total value of the stock of at least one other corporation in the group?
The Core Trade-Offs
Filing a consolidated return offers powerful benefits but also introduces complexity and restrictions. Here's a side-by-side comparison to help you weigh the decision.
Advantages
Disadvantages
Interactive Calculation Walkthrough
Calculating consolidated taxable income is a multi-step process. This interactive chart breaks down the example from the report (Corporations A, B, and C) to show how adjustments affect each member and the group as a whole.
Calculation Details
Select a step below to begin the calculation.
Key Compliance & Rules
Beyond the major pros and cons, there are important rules and compliance requirements to be aware of. Here are answers to some frequently asked questions.