Instructions For Form Fit-20 - Indiana Financial Institution Tax Return

Net Capital Loss Adjustment for FIT-20 Line 23 - Sample Worksheet

Enclose with your return your worksheet that shows the following calculations. Use this format to determine the available amount of an

Indiana net capital loss and the remainder to carry forward. Add sheets to include all members of a unitary group.

Computation of Indiana Net Capital Loss for Carryforward

For a taxpayer who is not filing a combined return, the taxpayer’s taxable income consists of an adjustment for net capital losses

computed under the Internal Revenue Code and derived from Indiana. Capital losses and capital gains derived from Indiana are

determined by the apportionment percentage applicable to each taxable year.

Example

Loss Year Ending: 12-31-2011

1. Net capital loss from federal Schedule D without IRC Section 1212 carryover ..................................................................................($80,000)

2. FIT-20 Indiana apportioned income percentage for the taxable year of the capital loss ...........................................................................50%

3. Indiana net capital loss for carry forward (limited to succeeding five years) .....................................................................................($40,000)

Additional provisions required for a combined return: Any net capital loss or net operating loss attributable to Indiana in the combined

return must be prorated between each member of the unitary group having nexus in Indiana. Each member must calculate its share of

the capital loss and amount available to be applied for the combined return.

The net capital loss attributable to Indiana in the combined return is prorated between each taxpayer member of the unitary group by the

quotient of:

(a) The Indiana receipts of those taxpayer members attributable to Indiana, divided by:

(b) The total receipts of all taxpayer members to Indiana

Example

Indiana receipts attributable to:

Member A

Member B

Member C

Combined Indiana total

$6,000,000

$9,600,000

$8,400,000

$24,000,000

Member’s ratio of Indiana receipts:

25%

40%

35%

100%

Prorated share of Indiana net capital loss:

($10,000)

($16,000)

($14,000)

Carry forward these amounts separately on the combined return.

Use this portion of the worksheet as many times as needed to determine the deductible net capital loss applied against any Indiana net capital

gains during the five-year carryforward period following the year of a loss.

Computation of Net Capital Loss Adjustment

The net capital loss available to be applied, if any, and carried forward to any subsequent year shall be limited to the capital gains for the

subsequent year of each taxpayer member. The amount of net capital gains is determined by the same receipts formula used in computing

the amount of loss derived from Indiana and is prorated between members of a unitary group (IC 6-5.5-2-1).

Example

Loss Year Ending: 12-31-2011

4. Net capital loss from federal Schedule D (recomputed without any IRC Section 1212 unused capital loss carryover) ..................$50,000

5. FIT-20 Indiana apportioned income percentage for the taxable year ............................................................................................................60%

6. Available Indiana net capital gain for the year .............................................................................................................................................$30,000

Example for members of a unitary group filing a combined return having a net capital gain in 2011:

Member A

Member B

Member C

Combined Indiana total

Indiana receipts attributable to:

$5,000,000

$35,000,000

$10,000,000

$50,000,000

Member’s ratio of Indiana receipts:

10%

70%

20%

100%

Prorated share of Indiana net capital loss: $3,000

$21,000

$6,000

Application of Indiana Net Capital Loss Adjustment

Enter the unused net capital loss from loss year (prorated amounts) or remaining amount(s) of each member as reduced during each of

the intervening years following the year of loss. The current year adjustment for Indiana is limited to the unused amount of net capital

loss, up to the amount of the net capital gains prorated for each member.

Amount of Loss Applied to (2011):

$3,000

$16,000

$6,000

7. Combined total of Indiana net capital loss adjustment for the tax year. Carry to line 23 of Form FIT-20 ........................................$25,000

Note: This amount may be applied only up to the amount of the current year’s income tax liability.

8. Remaining share of taxable capital gain:

-0-

$5,000

-0-

($7,000)

-0-

($8,000)

and (unused net capital loss):

(Share of carryover to 2011)