Instructions For 2008 Schedule Rt - State Of Wisconsin
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12Instructions for 2008 Schedule RT
Table of Contents
General Instructions for Schedule RT ...................1
Additional Guidance for Part II ...............................6
Who Must File Schedule RT ..................................1
Item A, Box i.: Taxable Year ..................................6
Purpose of Schedule RT........................................1
Item A, Box i.: Less Than 100% of Interest
Due Date for Schedule RT.....................................2
Expense Paid to Unrelated Entity ..........................7
Item A, Box ii.: Related Entity With Loss or Credit
Definitions Relating to Schedule RT......................2
Who Is a “Related Entity”? .....................................2
Carryforwards ........................................................7
What Are “Interest Expenses”?..............................3
Item A, Box ii.: Differing Reporting Periods ...........7
What Are “Rental Expenses”? ...............................3
Item A, Box ii.: Taxpayer or Related Entity Is a
Specific Instructions for Part I................................4
Pass-Through Entity ..............................................7
Supporting Documentation and Attachments ........4
Additional Guidance for Item A, Box iii. .................8
Guidelines for Adequate Disclosure ......................4
Transactions Involving REITs ................................9
Specific Instructions for Part II...............................4
For Further Assistance .........................................10
Item A, Box i...........................................................4
Item A, Box ii. .........................................................5
Worksheet A: Computation of Aggregate Effective
Item A, Box iii. ........................................................5
Tax Rates.................................................................11
Item B.....................................................................6
If Expenses Are Not Eligible for Deduction............6
Worksheet B: Wisconsin Effective Tax Rate of a
Department of Revenue’s Authority .......................6
Pass-Through Entity ................................................12
General Instructions for Schedule RT
Who Must File Schedule RT
Purpose of Schedule RT
A taxpayer or pass-through entity which claims a
The purpose of Schedule RT depends on the
deduction on a Wisconsin income or franchise
type of related entity expense involved.
tax return for certain expenses paid, accrued, or
Interest Expenses and Rental Expenses.
incurred to a “related entity” must file Sched-
2007 Wisconsin Act 226 enacted statutes pro-
ule RT if those expenses exceed $100,000.
viding that a taxpayer or pass-through entity
The requirement to file Schedule RT applies to
which directly or indirectly pays, accrues, or in-
taxable years beginning on or after January 1,
curs interest expense or rental expense to a “re-
2008.
lated entity” and deducts the expense on a fed-
eral income tax return must make an addition to
Taxpayers and pass-through entities required to
Wisconsin income to reverse out the expense.
file Schedule RT include corporations, individu-
For expenses that are “added back” in this man-
als, tax-option (S) corporations, partnerships,
ner, the taxpayer or entity must then file
limited liability companies (LLCs), insurance
Schedule RT (unless not required, as described
companies, and fiduciaries.
previously in Threshold Amount) to obtain a Wis-
consin deduction for those expenses.
Threshold Amount. Schedule RT is required if
the total related entity expenses described on
Caution: If Schedule RT is required but not
lines 1 through 4c of Schedule RT (adjusted for
timely filed, no Wisconsin deduction is allowed
the Wisconsin apportionment percentage if ap-
for related entity interest expenses or rental ex-
plicable) exceeds $100,000.
penses. See Due Date for Schedule RT, below.
IC-175 (02-09)
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