Arizona Form 308 - Credit For Increased Research Activities

Arizona Form 308

Part 3 –

NOTE: Trusts and estates which are partners in a partnership

are not eligible to claim this credit. However, the share of a

Total Current Year’s Credit Passed Through

partnership owned by a grantor trust that is disregarded for

From Partnerships

federal income tax purposes is treated as owned by the grantor.

Line 31 -

The grantor may claim his or her share of the credit.

Enter the total amount you received as a flow through from

Part 6 - S Corporation Credit Election

Form(s) 308-P, Part 2, line 4. If you received a pass through of

An S corporation may make an irrevocable election to pass this

this credit from more than one partnership, include a schedule

credit through to its shareholders. Or, it can choose to keep this

providing this information for each partnership. Enter the total

credit and apply it to its own liability generated at the corporate

from that schedule here. Include a copy of each Form 308-P

level.

you received with your return.

Enter the date the S corporation taxable year ends. Check the

Part 4 –

box corresponding to the election made by the S corporation,

Total Current Year’s Credit for Increased

(to claim the credit; or to pass the credit through to its

Research Activities

shareholders). The election must be signed by an officer of the

S corporation.

Line 32 -

When passing this credit through to your shareholders,

Add line 30 and line 31. Enter the total. This is your current

complete Form 308-S for each shareholder.

year’s total credit for increased research activities.

•

Provide a copy of the completed Form 308-S to each

•

Partnerships, enter this amount on Part 2, line 3 of the

shareholder.

partner’s Form 308-P.

•

File a copy of each completed Form 308-S with your tax

S corporations passing this credit through to its

•

return.

shareholders, enter this amount on Part 2, line 3 of the

•

Keep a copy of each completed Form 308-S for your

shareholder’s Form 308-S.

records.

•

All Others, go to Part 7.

S corporations electing to pass this credit through to its

Part 5 - Partnerships and S Corporations Only

shareholders, proceed to the instructions for completing

Determining Maximum Refund Amount to be Passed

Form 308-S on page 7.

Through to Partners or Shareholders

S corporations electing to claim this credit at the corporate

level, continue to Part 7.

Line 33 -

NOTE:

Trusts and estates which are shareholders of S

Enter the amount of your current year credit from line 32.

corporations, are not eligible to claim this credit. However,

Line 34 –

the share of an S corporation owned by a grantor trust that is

Multiply line 33 by 75% (.75), Enter the result.

disregarded for federal income tax purposes is treated as

Line 35 –

owned by the grantor. The grantor may claim his or her share

of the credit.

Enter the amount of your maximum refundable credit from

Part 1, line 2a2.

Part 7 – Refundable Portion of Your Current

Line 36 –

Taxable Year’s Excess Credit

Enter the total maximum refundable credit(s) from any pass

Complete Part 7 ONLY if you checked the “Yes” box on line 2

through entities from Form(s) 308-P, Part 3, line 6.

and/or line 4 and elected to receive a refund of 75% of your

Line 37 –

excess credit.

Add lines 34 and 35 and enter the total. This is the maximum

NOTE: If you are an individual receiving a pass through of

refundable credit you have for this taxable year.

this credit from a partnership or an S corporation, you must

Line 38 -

complete Form 308-I to claim your refund of this credit.

Enter the lesser of line 34 or line 37. This is the maximum

The excess credit is the current taxable year's credit for

refund amount your partners or shareholders may claim

increased research activities less the current taxable year's tax

for this taxable year.

liability. Carryovers of the credit for increased research

Each partner or shareholder is entitled to a proportionate share

activities from previous taxable years will carryover for

of the credit.

possible use in the next taxable year, provided they do not

expire this taxable year.

The total of the credit allowed to all partners or shareholders

may not exceed the amount that would have been allowed for a

Line 39 -

sole owner.

Enter the amount of the current taxable year's credit from

Partnerships claiming this credit must pass it through to their

Part 4, line 32.

partners.

Proceed to the instructions for completing

Form 308-P on page 7.

Arizona Form 308 - Credit For Increased Research Activities - 2016 Page 4

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