Form Ma Nrcr Instructions - Nonresident Composite Return Instructions printable pdf download

Form MA NRCR Instructions

Note: This form, and all accompanying schedules, must be filed elec-

Note: The extension will not be valid if the filing entity fails to pay 80%

tronically as required by 830 CMR 62.5A.1(11)(f)4 .

of the total tax liability of participating members through estimated tax

payments, prior year credits, and payments made with extension.

Who must file

What should I do if I make a mistake or leave

Massachusetts allows a partnership or an S corporation to file an elec-

something off the return?

tronic composite return on Form MA NRCR and make estimated tax pay-

If, after filing your income tax return, you receive an additional tax state-

ments as an agent on behalf of two or more qualified electing nonresi-

ment or discover that an error was made, you should amend your return

dent members. (Professional athletic teams who may file a return on

with the corrected information and fill in the “Amended return” oval. An

behalf of two or more qualified electing nonresident team members must

amended return can be filed to either increase or decrease your tax.

file a composite return on the Form 1 NR/PY, not the Form MA NRCR.)

Generally, an amended return must be filed within three years of the date

Eligible members of a composite return must meet the following

that your original return was filed. Electronic filing requirements apply

requirements:

to amended returns and disputes. See TIR 16-9 for further information.

• must be an individual or the estate or trust of a deceased nonresident

In certain instances, an amended return showing a reduction of tax may

member;

be treated by DOR as an abatement application. Under such circum-

stances, by filing an amended return, you are giving your consent for the

• must be nonresidents for the entire taxable year;

Commissioner of Revenue to act upon the abatement application after

• must elect to be included in the composite return by signing a statement;

six months from the date of filing. See TIR 16-11. You may withdraw

such consent at any time by contacting the DOR in writing. If consent

• must agree to be subject to Massachusetts tax jurisdiction; and

is withdrawn, any requested reduction in tax will be deemed denied ei-

• must waive the right to claim deductions, exemptions and credits al low -

ther at the expiration of six months from the date of filing or the date

able under Ch. 62, secs. 3, 5 and 6.

consent is withdrawn, whichever is later.

The composite return is filed on Massachusetts Form MA NRCR along

Name and address

with Schedules B, D, and E as needed. The total Massachusetts gross

Enter the full name, address, and Federal Identification number of the

income reported on the composite Form MA NRCR must be the sum of

entity filing the return in the spaces provided. Also, enter the name of the

all the qualified electing nonresident members’ Massachusetts source

filing agent.

income from the filing entity and from any other upper-tier entities that

are included in the return.

Schedule TDS. Inconsistent filing position penalty

Fill in the oval and attach Schedule TDS, Taxpayer Disclosure State-

The filing entity must file an electronic 2K-1, 3K-1, or SK-1 on behalf of

ment, if you are disclosing any inconsistent filing positions. The incon-

each nonresident member electing to participate in this composite re -

turn. In a tiered structure, if the filing entity is filing on behalf of members

sistent filing position penalty (see TIR 06-5, section IV ) applies to tax-

payers that take an inconsistent position in reporting income. These

of an upper-tier entity, it should issue the 2K-1, 3K-1, or SK-1 to that

taxpayers must “disclose the inconsistency” when filing their Massachu-

upper-tier entity, which will in turn file the appropriate K-1 on behalf of its

members reflecting estimated payments made by the lower-tier entity.

setts return. If such inconsistency is not disclosed, the taxpayer will be

subject to a penalty equal to the amount of tax attributable to the incon-

Each entity in the tiered structure will issue the appropriate K-1 to each

sistency. This penalty is in addition to any other penalties that may apply.

of its members showing estimated payments allocated to that member

that were made by lower-tier entities in the tiered structure.

A taxpayer is deemed to have taken an “inconsistent position” when the

taxpayer pays less tax in Massachusetts based upon an interpretation

A tiered structure is a pass-through entity that has a pass-through entity

as a member. As between two entities, the pass-through entity that is a

of Massachusetts law that differs from the position taken by the tax-

payer in another state where the taxpayer files a return and the govern-

member is the upper-tier entity, and the entity of which it is a member is

ing law in that other state “is the same in all material respects” as the

the lower-tier entity. A tiered pass-through entity arrangement may

have two or more tiers; in such cases, a single entity can be both a lower-

Massachusetts law. The Commissioner may waive or abate the penalty

if the inconsistency or failure to disclose was attributable to reasonable

tier and an upper-tier entity.

cause and not willful neglect.

Note: Members of a composite return cannot take credit for withholding

on Form MA NRCR. In instances where a member needs to claim credit

Summary information

for withholding, a Form 1-NR/PY must be filed. See The Guide to Pass-

Amounts entered on each line represent the total for all members elect-

Through Entities for more information.

ing to be included on the composite return. If any member has any entry,

regardless of amount, on Form B, D, or E, the entity should file the rel-

How much should the filing entity pay in

evant form; amounts entered on Forms B, D, or E represent the total

estimated tax payments?

for all members.

Composite payments of estimated tax must satisfy the estimated pay-

ment obligations for each electing non-resident with regard to the Mass -

Lines without specific instructions are considered to be self-explanatory.

achusetts-source income of the pass-through entity. The filing agent

shall make payments of estimated tax electronically.

When to file your return

Form MA NRCR is due on or before April 18, 2017. All composite re -

turns must be made on a calendar year basis. An automatic extension

is granted if 100% of tax due is paid by the tax return due date.

Form Ma Nrcr Instructions - Nonresident Composite Return Instructions

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