Instructions For Ohio Form Ft 1120fi - Ohio Corporation Franchise Tax Report

in the numerator of the factor is determined by multiplying such

amount by which interest from federal funds sold and securi-

fees by a fraction whose numerator is the amount included in the

ties purchased under resale agreements exceeds interest

numerator of the sales factor pursuant to the instructions for line #4

expense on federal funds purchased and securities sold

above, and whose denominator is the total amount of interest (and

under repurchase agreements by a fraction whose numera-

fees or penalties in the nature of interest) from loans not secured

tor is the average value of federal funds sold and securities

by real property.

purchased under agreements to resell which are properly

assigned to a regular place of business of the taxpayer

Line 13 – Loan-servicing fees for servicing either the secured or

within Ohio and whose denominator is the average value of

unsecured loans of others. The numerator of the factor includes

all such funds and such securities.

loan-servicing fees for servicing either the secured or unsecured

(iii) The amount of interest, dividends, gains and other income

loans of another if the borrower is located in Ohio.

from trading assets and activities, but excluding amounts

described in B(i) and B(ii) above included in the numerator of

Line 14 – Receipts from services not otherwise apportioned.

the factor is determined by multiplying the amount described

The numerator of the factor includes receipts from services not

in A(ii) above, by a fraction whose numerator is the average

otherwise apportioned if the service is performed in Ohio. If the

value of such trading assets that are properly assigned to a

service is performed both within and without Ohio and if a greater

regular place of business of the taxpayer within Ohio and

proportion of the income-producing activity is performed in Ohio than

whose denominator is the average value of all such assets.

in any other state based on cost of performance, the numerator of

(iv) Dividends and interest received from subsidiaries – amount

the sales factor includes receipts from such service.

included in numerator. The amount of dividends received on

Line 15 – Interest, dividends, net gains and other income from

the capital stock of, and the amount of interest received from

loans and advances to, subsidiary corporations at least 51%

investment assets and activities and from trading assets and

of whose common stock is owned by the taxpayer included

activities. “Investment assets and activities” and “trading assets

and activities” include but are not limited to: investment securities,

in the numerator of the factor is determined by multiplying

such dividends and interest by a fraction whose numerator

trading account assets, federal funds, securities purchased and

is the sum of the net book value of the payor’s real property

sold under agreements to resell or repurchase, options, futures

owned in Ohio and the payor’s tangible personal property

contracts, forward contracts, notional principal contracts such as

owned in Ohio and whose denominator is the sum of the

swaps, equities and foreign currency transactions.

net book value of the payor’s real property owned wherever

A. Components of the denominator with respect to interest,

located and the payor’s tangible personal property owned

dividends, net gains and other income from investment assets

wherever located. For purposes of determining this fraction,

and activities and from trading assets and activities:

the taxpayer must determine net book value in accordance

(i) With respect to investment assets and activities and trading

with generally accepted accounting principles.

assets and activities, the factor includes the amount by which

interest from federal funds sold and securities purchased

C. Gross income method for determining components of the nu-

merator with respect to interest, dividends, net gains and other

under resale agreements exceeds interest expense on fed-

income from investment assets and activities and from trading

eral funds purchased and securities sold under repurchase

agreements.

assets and activities described above. In lieu of using the aver-

age value method set forth in the instructions for item (B) above,

(ii) With respect to trading assets and activities, the factor in-

cludes the amount by which interest, dividends, gains and

the taxpayer may elect, or the tax commissioner may require in

order to fairly represent the business activity of the taxpayer in

other income from trading assets and activities, including,

Ohio, the following alternative method:

but not limited to, assets and activities in the matched book,

in the arbitrage book and foreign currency transactions,

(i) The amount of interest and dividends (other than interest

and dividends from a subsidiary corporation at least 51%

exceed amounts paid in lieu of interest, amounts paid in lieu

of whose common stock is owned by the taxpayer) and

of dividends, and losses from such assets and activities.

the amount of net gains and other income from investment

B. Average value method for determining components of the nu-

assets and activities in the investment account included in

merator with respect to interest, dividends, net gains and other

the numerator of the factor are determined by multiplying all

income from investment assets and activities and from trading

such income from such assets and activities by a fraction

assets and activities described above. “Average value” as used

whose numerator is the gross income from such assets

below is determined by using the same rules for determining the

and activities which are properly assigned to a regular

average value of tangible personal property for purposes of the

place of business of the taxpayer within Ohio and whose

property factor.

denominator is the gross income from all such assets and

(i) The amount of interest and dividends (other than interest

activities.

and dividends from a subsidiary corporation at least 51%

(ii) The amount of interest from federal funds sold and purchased

of whose common stock is owned by the taxpayer) and

and from securities purchased under resale agreements

the amount of net gains and other income from investment

and securities sold under repurchase agreements included

assets and activities in the investment account included in

in the numerator of the factor is determined by multiplying

the numerator of the factor are determined by multiplying all

the amount by which interest from federal funds sold and

such income from such assets and activities by a fraction

securities purchased under resale agreements exceeds

whose numerator is the average value of such assets that

interest expense on federal funds purchased and securities

are properly assigned to a regular place of business of the

sold under repurchase agreements by a fraction whose

taxpayer within Ohio and whose denominator is the average

numerator is the gross income from such funds and such

value of all such assets.

securities which are properly assigned to a regular place

(ii) The amount of interest from federal funds sold and purchased

of business of the taxpayer within Ohio and whose

and from securities purchased under resale agreements and

denominator is the gross income from all such funds and

securities sold under repurchase agreements included in

such securities.

the numerator of the factor is determined by multiplying the

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Instructions For Ohio Form Ft 1120fi - Ohio Corporation Franchise Tax Report - 2012 Page 13

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