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shareholders, trusts and estates that pass-through as a result

Alternative Completion of IT-20S Schedule IN K-1

of the S corporation's activities everywhere. See IT-20S

Information - An alternative application of IT-20S Schedule IN

Schedule E instructions beginning on page 17.

K-1 must be used if a shareholder is a nonresident individual,

Before continuing to lines 6 through 24, complete IT-20S

fiduciary or trust and the corporation had income from outside

Schedule IN K-1 on the reverse side of the form for each

Indiana. Use the following method for completion of Schedule

shareholder.

IN K-1 when the corporation had any apportioned income

from outside Indiana or is otherwise required to complete the

IT-20S Schedule IN K-1 Shareholder's

Indiana apportionment schedule:

Share of Indiana Adjusted Gross Income,

Modify each required Schedule IN K-1 line entry by

Deductions, Modifications and Credits

recalculating the pro rata share of total S corporation income

with required Indiana modifications to adjusted gross income

Attach IN K-1 to Form IT-20S or provide a complete

reported on line 1 of Form IT-20S. Use pro rata amount from

summary, of all information from the IN K-1 for each

line 13A, Worksheet for S Corporation Distributive Share

shareholder, with the return.

Income, Deductions and Credits, on page 15, by applying

these steps:

Shareholder's Identification Section

Complete IT-20S IN K-1 to identify each shareholder.

Step 1. Deduct from the above pro rata share the respective

(a) Enter the name of shareholder.

pro rata amount of line 13B and line 14B of the Worksheet.

(b) Enter the social security or federal identification number

of shareholder.

Step 2. Multiply the result by the Indiana apportionment percent

reported on line 5 of Form IT-20S, from Schedule E, line 4c, if

(d) Enter the amount of tax withheld on income distributions

present. This amount should reflect the shareholder’s

derived from Indiana sources for any nonresident

proportionate share of this S corporation’s activity in Indiana.

shareholder for the taxable year. Do not include any

penalty or interest paid on delinquent withholding tax. If

Step 3. Add to the above amount the pro rata share of any

no withholding tax was paid or if additional withholding

other (entity) source income received by the corporation that

tax is due, see instructions for filing Form DB020W-NR.

was previously apportioned, or allocated as distributive share

Credit for any amount withheld is to be claimed on the

income derived from Indiana (line 15C of the Worksheet). The

shareholder’s Indiana individual, composite, or fiduciary

result is the modified Indiana S corporation income from Indiana

income tax return.

sources to be reported on the appropriate lines of Schedule IN

(e) Enter the applicable pro rata percentage of shareholder’s

K-1 of nonresident individuals, trust and estates for adjusted

interest in the S corporation. The percentage should be

gross income purposes.

adjusted to an annual rate if necessary.

Line 14. Enter the Indiana modifications from the front of Form

Distributive Share Amounts

IT-20S, line 2, as percentage applied, or apportioned in the

Complete lines 1 through 15 for the shareholder. Also

case of nonresident individuals. List share amount of each

provide the shareholder with a statement showing the

modification.

shareholder's distributive share of income, credits and

modifications.

Line 15. If the corporation has available any eligible Indiana

credits flowing through to the shareholders, enter the pro rata

Line 1 through Line 12. For full year Indiana resident

amount allowed for the shareholder and indicate type of credit(s)

shareholders, complete these lines as shown on the federal

allotted. You must also attach a completed credit schedule

Schedule K-1, Form 1120S.

to Form IT-20S to support this credit distribution. See list of

For most nonresident shareholders, the federal Schedule

Pass-through Tax Credits on pages 19 to 21. For further

K-1 amounts should be multiplied by the Indiana

information request Income Tax Information Bulletin #59.

apportionment percentage calculated on the IT-20S Schedule

E. See instructions beginning on page 17. The apportioned

Form IT-20S Schedule B

figures should be entered on lines 1 through 12.

Investment interest expenses attributed to royalty income

Tax on Excess Net Passive Income and Built-in Gains

and all other federal deductions (excluding those treated as

To the extent that the S corporation’s excess net passive

itemized deductions) should be included on line 12. No other

income and built-in capital gains are subject to income tax

type of investment interest expense, itemized deduction, or

under the Internal Revenue Code, the Indiana adjusted gross

carryover loss should be reported on this line. Note: If the

income tax is imposed upon such income of the corporation

corporation has received any distributions from other entities

derived from Indiana sources. Use the following guidelines to

having income previously apportioned to Indiana, use the

calculate the corporation’s tax liability. Quarterly estimated

following methodology to report distributive share income for

tax payments are required if the Indiana tax liability exceeds

IT-20S IN K-1.

$1,000. All references are from the federal forms. Use updated

versions where applicable.

Form It-20s - S Corporation Income Tax Booklet - Indiana Department Of Revenue - 2005 Page 8

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