Reg. § 1.987-9 Recordkeeping requirements.
(a) In general An owner (or the authorized person on behalf of an owner) must keep a copy of the statement described in for each section election made by or on behalf of the owner (if not required to be made on a form published by the Commissioner) and reasonable records sufficient to establish section taxable income or loss and section gain or loss with respect to each section QBU, successor deferral QBU, and successor suspended loss QBU, as applicable, for each taxable year.
(b) Supplemental information A person's obligation to maintain records under section and of this section is not satisfied unless the following information is maintained in those records with respect to each section QBU, successor deferral QBU, and successor suspended loss QBU for each taxable year:
(1) The amount of the items of income, gain, deduction, or loss attributed to the section QBU in the functional currency of the section QBU and its owner.
(2) The adjusted balance sheet of the section QBU in the functional currency of the section QBU and its owner. If a current rate election is in effect and the owner computes QBU net value under without preparing an adjusted balance sheet, the information needed to apply must be maintained in lieu of an adjusted balance sheet.
(3) The exchange rates used to translate items of income, gain, deduction, or loss of the section QBU into the owner's functional currency and, if a spot rate convention is used, the manner in which the convention is determined.
(4) The exchange rates used to translate the assets and liabilities of the section QBU into the owner's functional currency and, if a spot rate convention is used, the manner in which the convention is determined.
(5) The amount of assets and liabilities transferred by the owner to the section QBU determined in the functional currency of the owner and the section QBU.
(6) The amount of assets and liabilities transferred by the section QBU to the owner determined in the functional currency of the owner and the section QBU.
(7) The amount of the unrecognized section gain or loss for the taxable year determined under .
(8) The amount of the net accumulated unrecognized section gain or loss for the taxable year determined under .
(9) The amount of the remittance and the remittance proportion for the taxable year.
(10) The computations required under and -9T(g) for purposes of sourcing and characterizing section gain or loss, deferred section gain or loss, suspended section loss, or pretransition gain or loss under .
(11) The cumulative suspended section loss in each recognition grouping.
(12) The outstanding deferred section gain or loss in each recognition grouping.
(13) The transition information required to be determined under .
(14) The identification required under with respect to a section hedging transaction.
(c) Retention of records The records required by this section, or records that support the information required on a form published by the Commissioner regarding section , must be maintained and kept available for inspection by the Internal Revenue Service for so long as the contents thereof may become relevant in the administration of the Internal Revenue Code.
(d) Information on a dedicated section 987 form Information necessary to determine section gain or loss and section taxable income or loss must be reported on a form prescribed for that purpose (or, until that form is published, on Form 8858 or its successor) in accordance with the applicable forms and instructions. A taxpayer satisfies its obligation described in and of this section to the extent that the taxpayer provides the specific information required on Form 8858 (or its successor) or other form prescribed for this purpose (including the information required by the instructions accompanying those forms).
[T.D. 10016, 89 FR 100165, Dec. 11, 2024]