Monday, May 4, 2015

IRS Releases 2012 Corporation Income Tax Returns Complete Report (Publication 16)

Tables presenting statistics from the Form 1120 series are now available in 2012 Corporation Income Tax Returns Complete Report (Publication 16). Published annually, these tables present comprehensive data on corporation income tax returns.

This release includes returns with accounting periods ending July 2012 through June 2013 and includes data from Forms 1120, 1120F, 1120L, 1120PC, 1120RIC, 1120REIT, and 1120S. 

Data are classified by industry, size of total assets, and size of business receipts. Separate tabulations of data reported on Form 1120S, U.S. Income Tax Return for an S Corporation, are also included. 

This report presents statistical estimates based on a stratified sample of more than 110,004 unaudited returns selected from the nearly 5.8 million active corporate returns filed for Tax Year 2012. This tax year includes accounting periods ending July 2012 through June 2013. 

Six sections make up this report. 
  • Section 1 provides statistics summarizing overall corporate activity for Tax Year 2012.
  • Section 2 discusses changes in laws and regulations between this report and that for Tax Year 2011. 
  • Section 3 describes, in detail, the sample of income tax returns, method of estimation used, sampling variability of the data, and other limitations. 
  • Section 4 presents tables containing detailed statistics on assets, liabilities, receipts, deductions, net income, income tax liability, tax credits, and other financial data for 2012. It also includes data submitted on Form 1120S, U.S. Income Tax Return for an S Corporation, unless specifically excluded by the table. Form 1120S data are also shown separately toward the end of the section. Statistics are presented by industry, asset size, business receipts size, tax form type, accounting period ended, and other selected classifiers.
  • Section 5 explains the terms used throughout this report and includes the adjustments made in preparing the statistics and any limitations inherent in the data. 
  • Section 6 consists of the key corporation tax return forms.

Overall Corporate Summary 

Figure A presents corporation summary statistics for Tax Years 2011 and 2012. This data includes the number of returns, total assets, total receipts, and net income (less deficit), income subject to tax, total income tax before credits, and total income tax after credits for active corporations. The number of active corporate tax returns filed increased approximately 0.3 percent between 2011 and 2012. Approximately 3,658,981 corporations filed tax returns electronically in 2011. This number rose 11 percent in 2012, reaching an all-time high of 4,080,293 returns filed electronically.

Total assets for active corporations increased approximately 4.5 percent, from $81.3 trillion in 2011 to $85 trillion in 2012. By sector, Educational Services experienced the largest net decrease, down 4.6 percent from $54.8 billion in 2011 to $52.3 billion in 2012. In contrast, Mining recorded an increase of $115 billion in total assets. It also showed the largest percent change (up 11 percent) for 2012.

Total receipts from operations and investments increased 3.9 percent, from $28.3 trillion in 2011 to $29.4 trillion the following year. This was driven by an 3.8-percent increase in business receipts, from 25.2 trillion in 2011 to 26 trillion in 2012. Investment income showed small decreases during the year. Interest received also declined 7.7 percent, from $1.30 trillion to $1.20 trillion. In comparison, net capital gains rose 20.6 percent, from $151.9 billion in 2011 to $183.2 billion in 2012. Nearly all sectors experienced an increase in total receipts, with the exceptions of Utilities (down 12.5 percent) and Management of Companies (down 3.3 percent).

Total deductions deductions increased 2.2 percent, from $27.1 trillion in 2011 to $27.7 trillion in 2012. The cost of goods sold, a component of total deductions, also rose 2.5 percent during the year, from $16.2 trillion to $16.6 trillion.


Corporate pretax profits, also known as net income (less deficit), increased34 percent, from $1.3 trillion to $1.8 trillion (Figure B). When excluding passthrough entities from the total, pretax profi ts increased from $737 billion in 2011 to $1.1 trillion in 2012. In comparison, when only excluding real estate investment trust (REITs), also a passthrough entity, pretax profi ts for all corporations increased by 34.4 percent, from $1,286,201,907 for 2011 and $1,729,289,378 for 2012. (Figure C).

Income subject to tax (the tax base) increased 15.6 percent, from $994 billion in 2011 to $1.1 trillion in 2012. Total income tax before credits rose 15.3 percent, from $349.3 billion to $402.9 billion. Income tax also increased (up 15.5 percent) during the year, from $345.4 billion to $399.1 billion. 

Total income tax after credits, the amount paid to the U.S. Government, rose 21 percent (or $46 billion), from $221 billion in 2011 to $267 billion in 2012. Of the 5.8 million active corporations for Tax Year 2012, approximately 4.2 million were passthrough entities. These entities include regulated investment companies (RICs), REITs and S corporations [1]. Passthrough entities pay little or no Federal income tax at the corporate level. By law, they are required to pass any profi ts or losses to their shareholders, where they are taxed at the individual rate. Pretax profi ts for passthrough entities increased 23.3 percent (or $136.4 billion) during 2012. 

The remaining 1.6 million corporate returns reported total receipts of $22.3 trillion, an increase of 3.1 percent from 2011 to 2012. Excluding pass through entities, approximately 825,000 corporations reported net income for 2012 [2].

Of these, 58.5 percent had a tax liability, compared to 13.7 percent of all corporations with net income. The number of returns with total assets of $2.5 billion or more represented only 0.05 percent of total returns, but 81.3 percent of total assets (Figure A). 

These 3,051 returns for 2012 accounted for 51.4 percent of the total receipts, 67.2 percent of net income (less deficit), 77.1 percent of income subject to tax, 77.6 percent of total income tax before credits, and 70.3 percent of total income tax after credits. 

Approximately 45.4 percent of all returns with net income and total assets greater than $2.5 billion had a tax liability for 2012. Excluding passthrough entities, this percentage increased to 88.2 percent for the year.

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