Instructions For Form Federal Adjustments For Businesses For Tax Year 2004 - Minnesota

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Federal Adjustments for Businesses
for tax year 2004
Minnesota defines net income for corporation franchise tax
American Jobs Creation Act of 2004 (P.L. 108-357)
according to the Internal Revenue Code, as amended through
• Section 211 — Recovery period for depreciation of certain
June 15, 2003. Since that date, several federal tax laws have been
leasehold improvements and restaurant property
enacted that contain a number of provisions affecting corpora-
• Section 233 — Expansion of bank S corporation eligible
tion franchise tax for tax year 2004. Because Minnesota has not
shareholders to include IRAs
yet adopted these federal changes, adjustments must be made to
correctly determine your Minnesota tax when filing your 2004
• Section 242 — Modification of application of income
Form M4, Corporation Franchise Tax Return.
forecast method of depreciation
• Section 243 — Improvements related to real estate invest-
How to report the federal adjustments
ment trusts
If any of the federal provisions listed in this fact sheet affect the
• Section 244 — Special rules for certain film and television
amount of taxable income reported on your 2004 federal Form
productions
1120, U.S. Corporation Income Tax Return, you must recompute
your federal taxable income without regard to those provisions
• Section 248 — Election to determine corporate tax on certain
and report the difference as an adjustment to income on your
international shipping activities using per ton rate
2004 Minnesota return.
• Section 311 — Special rules for livestock sold on account of
To report the differences for Minnesota tax purposes, you must:
weather related conditions
• attach a schedule to your Form M4 that lists the federal
• Section 312 — Payment of dividends on stock of cooperatives
provisions affecting your taxable income by the act title and
without regarding patronage dividends
section number,
• Section 316 — Modification to cooperative marketing rules
• show how you calculated each adjustment amount, and
to include value added processing involving animals
• include the net of all adjustments on line 2i of your Form
• Section 319 — Treatment of certain income of cooperatives
M4I, and write in “federal adjustments” on the dotted line
next to line 2i.
• Section 321 — Modification of safe harbor rules for timber
REITs
Provisions that may require an income adjustment
• Section 322 — Expensing of certain reforestation expendi-
The following provisions may require an income adjustment for
tures
Minnesota tax purposes:
• Section 331 — Net income from publicly traded partnerships
Working Families Tax Relief Act of 2004 (P.L. 108-311)
treated as qualified income of regulated investment compa-
• Section 306 — Extends the special rule for corporate dona-
nies
tions of scientific property and computer technology
• Section 336 — Modification of depreciation allowance for
• Section 308 — Extends the direct expensing of environmental
aircraft
remediation costs
• Section 338 — Expensing of capital costs incurred in comply-
• Section 319 — Eliminates the phaseout for clean-fuel vehicle
ing with Environmental Protection Agency sulfur regulations
property
• Section 403 — Changes to the “bonus depreciation” provi-
• Section 410 — Equal treatment of interest paid by foreign
sions of the Job Creation and Worker Assistance Act of 2002
partnerships and foreign corporations
• Section 404 — Amends Section 614 of the Economic Growth
• Section 418 — Modification of the treatment of certain REIT
and Tax Relief Reconciliation Act of 2001
distributions attributable to gains from sale or exchange of
United States real property interests
• Section 406 — Amends Section 1001 (constructive sales
treatment for appreciated financial positions) and Section
• Section 703 — Civil rights tax relief
1015 (holding period for dividends) of the Taxpayer Relief
Act of 1997
Continued
Corporation and Sales Tax Division
This fact sheet is intended to help you become more familiar with Minnesota
tax laws and your rights and responsibilities under the laws. Nothing in this fact
Mail Station 5510, St. Paul, MN 55146-5510
sheet supersedes, alters or otherwise changes any provisions of the tax law,
Phone: 651-297-7000
administrative rules, court decisions or revenue notices. Alternative formats
Minnesota Relay 711 (
)
TTY
available upon request.
Issued 12/04
Minnesota Revenue, Federal Adjustments for Businesses
1

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