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Part I – List of Foreign

Accordingly, with respect to each

Schedule I (Form 1120-F). A portion of

partnership interest, check the “Yes” box if

Partner Interests in

the interest expense reportable on

the foreign corporation is engaged in a

Schedule P is includible in the

Partnerships

U.S. trade or business indirectly through

corporation's interest expense allocation

the activities of the partnership. Check the

In Part I, list the name, address, and

computation under Regulations section

“No” box if the foreign corporation has

Employer Identification Number (EIN) of

1.882-5. The corporation's distributive

applied ECI principles solely at the partner

each directly owned partnership interest

share of interest expense that is directly

level and not as a result of the

that has effectively connected income

allocable to effectively connected income

partnership's activities.

(ECI) included in the partner's distributive

under Regulations section 1.882-5(a)(1)(ii)

share on Schedule K-1 (Form 1065). Also

(B) is reported on Schedule P, line 15b,

Part II – Foreign Partner

include in the list of partnership interests

and on Schedule I (Form 1120-F), line 22.

Income and Expenses:

any interest in a partnership that is not

A portion of the corporation's distributive

engaged in trade or business within the

share of interest expense that is reported

Reconciliation to

United States if the corporation treats

on Schedule P, line 15c, is reported on

Schedule K-1 (Form 1065)

some or all of its distributive share as ECI

Schedule I (Form 1120-F), line 9, column

with a separate trade or business of its

(b). The average value of partnership

Part II reconciles the partner's ECI and

own within the United States. Do not

liabilities the corporation includes in the

non-ECI to its Schedule K-1 (Form 1065)

report on Schedule P any indirectly

determination of its outside basis for

distributive share from each partnership

owned partnership interests (lower-tier

purposes of determining the proportion of

listed in Part I. The Schedule K-1 lines are

partnership interests) that have income

the partnership interest treated as a U.S.

grouped for reconciliation of their income

effectively connected with the lower-tier

asset is reported on Schedule P (Form

and expense in the following manner:

partnership's own trade or business within

1120-F), line 18 (Total column). The

Schedule P, lines 1 through 5: ECI and

the United States unless the corporation

average value of the partner's outside

non-ECI reconciliation of income and

also owns a direct interest in the lower-tier

basis used to determine the proportion of

non-interest expenses from Schedule K-1

partnership. The corporation's distributive

the partnership interest treated as a U.S.

(Form 1065), lines 1 through 3.

share of ECI earned through lower-tier

asset is reported on Schedule P (Form

Schedule P, lines 6 through 10:

partnership interests is includable on the

1120-F), line 20, and as a U.S. asset on

Reconciliation of other income and other

Schedule K-1 (Form 1065) reportable to

Schedule I (Form 1120-F), line 5, column

non-interest expenses from Schedule K-1

the corporation by the partnership in which

(b).

(Form 1065).

the corporation owns a direct interest,

Schedule P, lines 11 and 12: Total

Schedule H (Form 1120-F), Part I, Part

whether or not the directly owned

gross income and total gross ECI from

II, and Part IV. The corporation's

partnership is itself directly engaged in

Schedule K-1 (Form 1065).

distributive share of non-interest expenses

trade or business within the United States.

Schedule P, lines 13 through 15c:

included on Schedule P, lines 4 and 5 is

Reconciliation of total interest expense

also included in the corporation's overall

Schedule P (Form 1120-F)

from Schedule K-1 (Form 1065).

allocation and apportionment of expenses

accommodates reporting for four

on Schedule H (Form 1120-F), Part IV,

directly-owned partnership interests.

Note. The information needed to

lines 38a through 41, if the partnership

Complete a separate line in Part I, and the

complete Schedule P (Form 1120-F)

books constitute set(s) of books that are

corresponding columns in Parts II and III,

generally should appear on a statement

also reportable on Form 1120-F,

for each directly owned partnership

attached to the partner's Schedule K-1

Schedule L or the partnership interest is

interest. If the corporation directly owns

(Form 1065). Also note that if you are

recorded on Schedule L books of the

more than four partnership interests which

reconciling the foreign corporation's

corporation's own separate trade or

are required to be reported on Schedule P

distributive share of ECI and allocable

business within the United States. If the

(Form 1120-F), report the required

expenses with the total income and

partnership interest is not reported on

information for those additional

expenses reported to the corporation on

Schedule L, the distributive share of

partnership interests on attached separate

Schedule K-1 (Form 1065-B), the relevant

partnership expenses allocable to the

sheets using the same size and format as

information will be located in box 9 of the

corporation's distributive share of ECI is

shown on the schedule. Also, in the

Schedule K-1 (Form 1065-B) or in an

included on Schedule H (Form 1120-F) in

“Totals” column of Parts II and III, for each

attachment for box 9. Specifically, the

Parts I and II. See the Instructions for

line item, enter the sum for all directly

lines on Schedule K-1 (Form 1065) noted

Schedule H (Form 1120-F).

owned partnership interests, including

throughout these instructions correspond

those interests reported on attached

Schedule M-3 (Form 1120-F), Part II.

to the box 9 information on Schedule K-1

sheets.

The corporation's distributive share of

(Form 1065-B) as follows:

partnership income or loss may be

Entities treated as partnerships for tax

Schedule K-1 (Form 1065), line 1

reported on Schedule M-3 (Form 1120-F),

purposes include Limited Liability

corresponds to the information reported

Part II, line 9 (domestic partnerships) and

Partnerships (LLPs) and Limited Liability

on Schedule K-1 (Form 1065-B), box 9

line 10 (certain foreign partnerships) in

Companies (LLCs) that are not classified

using code A1.

accordance with the corporation's

as corporations for federal income tax

Schedule K-1 (Form 1065), line 2

reporting on its applicable financial

purposes and may be domestic or foreign.

corresponds to the information reported

statements for Schedule M-3 (Form

Do not include any interest in any entity

on Schedule K-1 (Form 1065-B), box 9

1120-F) purposes. See the Instructions for

treated as a disregarded entity as

using code B1.

Schedule M-3 (Form 1120-F), Part II, lines

described under Regulations section

Schedule K-1 (Form 1065), line 3

9 and 10 for the specific reporting

301.7701-2(c)(2).

corresponds to the information reported

requirements.

on Schedule K-1 (Form 1065-B), box 9

Column (d). With respect to each

using code C1.

partnership interest, check the “Yes” box if

Finally, note that other interest expense

the foreign corporation's distributive share

reported on Schedule K-1 (Form 1065),

is ECI, or treated as ECI, in whole or in

lines 13 and 18 corresponds to the

part, with a U.S. trade or business

information reported on Schedule K-1

determined under section 875.

Instructions for Schedule P (Form 1120-F) (2013)

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Form 1120-F - Instructions For Schedule P - List Of Foreign Partner Interests In Partnerships - 2013 Page 2

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