Absolutely yes. All domestic corporations must file Form 1120, regardless of whether they have taxable income. The obligation to file persists even if the corporation was inactive during the 2025 tax year. SDO CPA LLC A zero-income C Corp return confirms to the IRS that the corporation was inactive during the period. Consequently, failure to file — even for an inactive corporation — triggers the same failure-to-file penalties the IRS applies to profitable corporations.