Instruction For Form 120x - Amended Corporation Income Tax Return

Arizona Form 120X

affiliated group must use this method of apportionment if 50

denominator of a factor are zero. If the property or payroll

percent or more of the taxpayer’s gross income is derived

factor is excluded, determine the average ratio (line C5,

from air commerce. The taxpayer will apportion its business

column C) by dividing the total ratio by three. If the sales

income by means of a single apportionment ratio computed

factor is excluded, determine the average ratio by dividing

under this method for all group members.

the total ratio by two.

Schedule C – Apportionment Formula

Schedule D – Schedule of Payments

(Non-Air Carrier Multistate Taxpayers Only)

List the payment sent with the original return and all payments

Schedule C must be completed only if the 2006 Form 120X

made by the taxpayer after the original return was filed.

is filed to amend the apportionment ratio (if the taxpayer was

If additional space is required to list all of the payments,

required to use Schedule C). If the apportionment ratio is not

prepare a schedule (in the same format) labeled “Schedule D

being amended, enter the apportionment ratio from the 2006

– Schedule of Payments” and attach the schedule to the

Form 120 or as adjusted by any prior audit or amended

Form 120X.

return, whichever is latest, on the Form 120X, page 1, line 9,

DO NOT include the refundable remainder of the retroactive

in column (a) and column (c).

consolidation tax payment credit or the claim of right credit

ARS § 43-1139 (Allocation of business income) provides

computed under ARS § 43-1130.01 in this schedule.

that the apportionment ratio is a fraction. For taxpayers other

DO NOT include amounts paid for penalties and interest or

than air carriers: the numerator of the fraction is the property

payments reported on page 1, line 26.

factor plus the payroll factor plus two times the sales factor.

The denominator of the fraction is four.

Enter the total on Schedule D, line 4, and on page 1, line 27.

Determine sales within Arizona on a destination sales basis.

Schedule E – Explanation of Changes

Line C3(e) -

Explain the changes made in this return. If additional space is

NOTE: Multiply the amount entered on line C3(c), column

needed, prepare a schedule (in the same format) labeled

A, the total Arizona sales, by 2 (double weighted sales factor)

“Schedule E – Explanation of Changes” and attach the

on line C3(d), column A. Enter the amount on line C3(e),

schedule to the Form 120X. Include any necessary supporting

column A. Do not double the amount entered on line C3(e),

documentation with the return.

column B, the everywhere sales of the taxpayer.

Certification

EXAMPLE: The taxpayer has total Arizona sales of $100,000

and total everywhere sales of $1,000,000. On line C3(e), column A,

One or more of the following officers (president, treasurer, or

enter $200,000 of Arizona sales. On line C3(e), column B, enter

any other principal officer) must sign the return.

$1,000,000 of everywhere sales for the taxpayer.

Paid preparers: Sign and date the return. Complete the firm

The sales factor ratio in column C of line C3(e) may, in

name and address lines (the preparer’s name and address if

certain circumstances, exceed 100 percent. However, since

self-employed). Enter the preparer’s TIN, which is the firm’s

the total ratio (line C4) is divided by four, the average ratio

EIN or the individual preparer’s social security number or

(line C5) will not exceed 100 percent.

preparer identification number.

Line C5 -

Interest

Divide the total ratio, line C4, column C, by four. Enter the

The department will calculate any interest due and will either

average ratio amount here and on page 1, line 9(c). Express

include it in the refund or bill the taxpayer for the interest.

the ratio as a decimal carried out to six places.

Obtain information and current interest rates by contacting one

NOTE: Do not exclude a factor from the total ratio (line C4,

of the numbers listed on page 1 of these instructions. Interest

column C) if the numerator of a factor is zero and the

rate tables are also available on the department’s internet home

denominator of a factor is greater than zero. However, the

page at the address listed page 1 of these instructions.

taxpayer must exclude a factor if both the numerator and the

Instruction For Form 120x - Amended Corporation Income Tax Return - 2006 Page 5

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