Instructions For Ohio Form It-1140 Tax Return For Pass-Through Entities & Trusts For Taxable Years Beginning In 2001 (Page 6 of 10) in pdf

If there is more than one qualifying investor or more

shown on Schedule A, line 2b, which have been

than one qualifying beneficiary, repeat the sequence set

transferred to Ohio form IT-4708) and

forth in fields number 1 through number 9. You must

repeat all nine fields for each additional qualifying in-

The qualifying investor’s or beneficiary’s pro-

vestor or qualifying beneficiary.

portionate share of the 5% withholding tax and/

or 8.5% entity tax which passes through from

If you use magnetic media, please affix to the outside of

another pass-through entity or trust to the quali-

the magnetic media a label containing the following in-

fying pass-through entity or qualifying trust (and

formation in large print: (i) the name and federal em-

then passes on to the qualifying investor or quali-

ployer identification number of the qualifying pass-

fying beneficiary).

through entity or qualifying trust, (ii) the phrase, “IT-1140

K-1 Information,” and (iii) the phrase, “Taxable Year

Note: If this pass-through entity or trust has in-

Beginning in 2001.”

vested in a partnership or limited liability company

which also filed Ohio form IT-1140, then this pass-

Tax Credits Available to Certain Investors

through entity or trust is not entitled to a refund-

and Beneficiaries

able credit equal to this pass-through entity’s or

trust proportionate share of tax which the investee

Ohio Revised Code sections 5733.0611 and 5747.059

partnership or investee limited liability company

provide that qualifying investors (see page 2 of these

paid on behalf of this pass-through entity or trust.

instructions) can claim an income tax or franchise tax

This pass-through entity or trust cannot claim the

credit based upon the investor’s proportionate share of

credit as an estimated payment for this pass-

the 5% withholding tax or the 8.5% entity tax which was

through entity’s or trust’s taxable year.

paid on or with respect to the qualified investor’s direct

or indirect investment in the qualifying pass-through

Responsible Party Liability

entity. ORC section 5747.059 also provides for a simi-

lar credit for nonresident individual qualifying beneficia-

Ohio Revised Code section 5747.453 imposes personal

ries with respect to the 5% withholding tax which a quali-

liability for failure to pay the 5% withholding tax. Set

fying trust has withheld in connection with that nonresi-

forth below is that section of the law:

dent individual qualifying beneficiary.

An employee or beneficiary of, or investor in, a

In order for qualifying investors and qualifying benefi-

qualifying entity having control or supervision

ciaries to claim these credits, the qualifying investor or

of, or charged with the responsibility for, filing

the qualifying beneficiary must attach to the corpora-

returns and making payments, or any trustee

tion franchise tax report (Ohio form FT-1120 or FT-

or other fiduciary, officer, member, or manager

of the qualifying entity who is responsible for the

1120FI) or to the Ohio franchise tax request for refund

(Ohio form FT-REF) or to the Ohio income tax return

execution of the qualifying entity’s fiscal respon-

(Ohio form IT-1040 or IT-1041E or IT-4708) a copy of

sibilities, is personally liable for the failure to file

the IRS form K-1 which indicates the amount of the

any report or to pay any tax due as required by

sections 5747.40 to 5747.453 of the Revised

8.5% entity tax and/or 5% withholding tax with respect

to which the qualifying investor or qualifying beneficiary

Code. The dissolution, termination, or bank-

seeks to claim a credit. Accordingly, each qualifying

ruptcy of a qualifying entity does not discharge

pass-through entity or qualifying trust must sepa-

a responsible trustee’s, fiduciary’s, officer’s,

member’s, manager’s, employee’s, investor’s,

rately state on the form K-1, which the qualifying

pass-through entity or qualifying trust will issue to

or beneficiary’s liability for failure of the qualify-

the qualifying investor or qualifying beneficiary, the

ing entity to file any report or pay any tax due as

following information:

required by those sections. The sum due for

the liability may be collected by assessment in

the manner provided in section 5747.13 of the

The qualifying investor’s or beneficiary’s pro-

portionate share of the 5% withholding tax and/

Revised Code.

or 8.5% entity tax which the qualifying pass-

through entity or qualifying trust paid (net of re-

funds shown on this return and net of amounts

Instructions For Ohio Form It-1140 Tax Return For Pass-Through Entities & Trusts For Taxable Years Beginning In 2001 Page 6

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