Instructions For Form 5458 Draft (Page 3 of 3) in pdf

The income apportionment percentage is to be applied by

Line 2b: Enter the gross annual rent, multiplied by 8, for all

nonresident partners to their distributive share of business

rented real property regardless of location. Gross annual rent

refers to real property only, rented or leased during the taxable

income if business activity of the partnership is conducted

both within and without the City of Detroit. In order to use the

period, and should include the actual sums of money or other

separate accounting method, permission must be requested in

consideration payable, directly or indirectly, by the taxpayer for

the use or possession of such property.

writing from the administrator not more than 90 days after the

beginning of the taxpayer’s year.

Line 2d: Enter the total compensation paid to all employees

Column 4: Enter the total taxable portion of the salaries,

for work or services performed during the year, regardless of

interest or other guaranteed payments to partners receiving

location.

them.

Line 2e: Enter the total gross revenue from all sales or services

Column 5: Enter 100% of resident partners’ salaries, interest

rendered during the year, regardless of location. To allocate

net profit (or loss), a partnership must have business activity

or guaranteed payment or the portion of nonresident salaries,

interest or guaranteed payments earned in Detroit. (The

outside of Detroit.

amount is based on actual time inside Detroit for each partner

Line 3e: In determining the average, divide line 3d by 3.

as computed per the calculation at the bottom of page 5. Use a

However, if a factor does not exist, divide the sum of the all

separate page 5 calculation for each partner.)

line 3 percentages by the number of factors actually used.

Column 6A: Enter nonbusiness income taxable to resident

The income apportionment percentage is to be applied by

partners. The total will equal the amount on Schedule B, line

nonresident partners to their distributive share of business

15, column 2.

income if business activity of the partnership is conducted

Column 6B: Enter nonbusiness income taxable to nonresident

both within and without the City of Detroit. In order to use the

separate accounting method, permission must be requested in

partners. The total will equal the amount on Schedule B, line

15, column 5.

writing from the administrator not more than 90 days after the

beginning of the taxpayer’s year.

Column 7: Transfer the amount of each individual partner’s

NOTE: If there are no locations outside the city in Line 2 (all

share shown in Column 7 to page 1 of this return (line 11,

Line 2 totals will match corresponding Line 1 totals), transfer

column 1).

totals for Schedule D, line 1c to line 3a; 1d to 3b; and 1e to 3c.

Schedule D — Income Apportionment

Ignore all face-of-the-form instructions for Lines 3a, 3b, and

3c.

The business income apportionment percentage is to be applied

to the distributive share of business income of corporate and

Disclosure of Return Information

nonresident partners if business activity of the partnership is

The disclosure of Social Security account number(s) on this

conducted both within and outside the City of Detroit.

tax return is mandatory. This solicitation and use of Social

Line 1a: Enter the net book value of the real and tangible

Security account numbers is authorized by federal law (42

personal property owned and located or used in the City

USC § 405(c)(2)(C)(i)), Michigan law (MCL 141.642) and

of Detroit. The average net book value of real and tangible

City of Detroit ordinance (1984 Detroit City Code § 18-10-

personal property may be determined by adding the net book

11). Treasury uses Social Security account numbers in the

values at the beginning and end of the year and dividing the

administration of City of Detroit income tax law for the

sum by two.

purpose of establishing taxpayer identification, to automate and

Line 1b: Enter the gross annual rent, multiplied by 8, for rented

unify its tax reporting and collection, and as otherwise needed

real property located in the City of Detroit. Gross annual rent

for the administration of the City of Detroit income tax laws.

refers to real property only, rented or leased during the taxable

Under 1984 Detroit City Code § 18-10-16, any information

period, and should include the actual sums of money or other

gained by the income tax administrator, City treasurer, or

consideration payable, directly or indirectly, by the taxpayer for

other City official, agent or employee as a result of a tax return,

the use or possession of such property.

investigation, hearing or verification required or authorized

Line 1d: Enter the amount of compensation paid to employees

by the Uniform Income Tax Ordinance is confidential, except

for official purposes in connection with the administration of

for work or services performed within the City of Detroit.

the ordinance, and except in accordance with a proper judicial

Line 1e: Enter the amount of revenue derived from sales made

order.

or services rendered in the City of Detroit during the year. To

allocate net profit (or loss), a partnership must have business

activity outside of Detroit.

Line 2a: Enter in the average net book value of all real and

These instructions are interpretations of the Detroit

tangible personal property owned by the business, regardless

Income Tax Ordinance. The Ordinance will prevail in

of location. The average net book value of real and tangible

any disagreement between forms or instructions and

personal property may be determined by adding the net book

the Ordinance.

values at the beginning and end of the year and dividing the

sum by two.

Instructions For Form 5458 Draft Page 3

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