Form Krs 154.24-010 To 160 - Tax Computation Schedule (For A Kjda Project Of A Pass-Through Entity) Page 2

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41A720-S29 (10-12)
INSTRUCTIONS –SCHEDULE KJDA-SP
Page 2
Commonwealth of Kentucky
DEPARTMENT OF REVENUE
PURPOSE OF SCHEDULE—This schedule is used by a
practical to use a separate accounting method to determine the
pass-through entity which has entered into a tax incentive
net income, Kentucky gross receipts and Kentucky gross profits
agreement for a Kentucky Jobs Development Act (KJDA)
from the facility at which the economic development project is
project that received preliminary or final approval under KRS
located, the approved company shall use an alternative method
Chapter 154.24 on or before June 26, 2009, to determine the
approved by the Department of Revenue. A copy of the letter
credit allowed against the Kentucky income tax and LLET
from the Department of Revenue approving the alternative
attributable to the project in accordance with KRS 141.407.
method must be attached to this schedule.
Pass-through entities should first complete Form 720S, 765
Separate Accounting—If the economic development project is
or 765-GP to determine net income (loss), deductions, etc.,
a totally separate facility, net income shall reflect only the gross
from the entire operations of the pass-through entity. The
income, deductions, expenses, gains and losses allowed under
pass-through entity should then complete Schedule KJDA-SP
this chapter directly attributable to the facility and overhead
to determine the KJDA tax credit and the tax due, if any, from
expenses apportioned to the facility; and Kentucky gross
the KJDA project. A pass-through entity is subject to tax as
receipts or Kentucky gross profits shall reflect only Kentucky
provided by KRS 141.020 and KRS 141.0401 on the net income
gross receipts or Kentucky gross profits directly attributable
and the Kentucky gross receipts or Kentucky gross profits from
to the facility.
the project and the KJDA credit is applied against the tax of
the KJDA project. Consequently, the pass-through entity must
If the economic development project is an expansion to a
use Form 720S(K), Form 765(K) or Form 765-GP(K) in lieu of
previously existing facility, net income of the entire facility shall
Schedule K (Form 720S), Schedule K (Form 765) or Schedule
reflect only the gross income, deductions, expenses, gains and
K (Form 765-GP) in order to exclude the net income from the
losses allowed under this chapter directly attributable to the
KJDA project from the partners, members or shareholders’
facility and overhead expenses apportioned to the facility; and
distributive share income, and Schedule LLET(K) in lieu of
Kentucky gross receipts and Kentucky gross profits shall reflect
Schedule LLET in order to exclude the Kentucky gross receipts
only Kentucky gross receipts and Kentucky gross profits directly
or the Kentucky gross profits of the KJDA project from the
attributable to the facility. Net income, Kentucky gross receipts
LLET at the entity level.
and Kentucky gross profits of the entire facility attributable
to the economic development project shall be determined
Multiple Projects—A pass-through entity with multiple
by apportioning the net income, Kentucky gross receipts and
economic development projects must complete an applicable
Kentucky gross profits by a formula approved by the Department
schedule (Schedule KREDA-SP, Schedule KIDA-SP, Schedule
of Revenue.
KEOZ-SP, Schedule KJRA-SP, Schedule KIRA-SP, Schedule
KJDA-SP, Schedule KBI-SP, Schedule KRA-SP or Schedule IEIA-
Line 2—Enter the net operating loss from the KJDA project, if
SP) to determine the credit and net tax liability, if any, for each
any, being carried forward from previous years.
project.
Note: Just as the income from a KJDA project does not flow
Line 1—If the pass-through entity’s only operation is the KJDA
through to partners, members or shareholders, neither do the
project, the amount entered on Line 1 is the net income (loss)
losses. The project’s net operating loss from prior years must
from Form 720S, 765 or 765-GP. If the pass-through entity has
be subtracted from the project income before calculating the
operations other than the KJDA project, a schedule must be
KJDA credit.
attached reflecting the computation of the net income (loss) from
the KJDA project in accordance with the following instructions,
General Partnership—Lines 5 and 6 of this schedule shall not
and such amount entered on Line 1.
be completed by a general partnership as a general partnership
is not subject to LLET.
Separate Facility—In accordance with KRS 141.407(6), if the
project is a totally separate facility, net income, Kentucky gross
Line 5—Using Schedule LLET, create a new Schedule LLET to
receipts, and Kentucky gross profits attributable to the project
compute the LLET of the KJDA project using only the Kentucky
shall be determined by a separate accounting method.
gross receipts and Kentucky gross profits of the project. Enter
“KJDA” at the top center of the Schedule LLET and attach it to
Expansion of Existing Facility—In accordance with KRS
the tax return.
141.407(7), if the KJDA project is an expansion to a previously
existing facility, the net income, Kentucky gross receipts and
Line 9—In lieu of the tax credit, the approved company may
Kentucky gross profits shall be determined under a separate
elect, on an annual basis, to apply as an estimated tax payment
accounting method reflecting the entire facility, and the net
an amount equal to the allowable tax credit. Any estimated
income, Kentucky gross receipts and Kentucky gross profits
tax payment shall be in satisfaction of the tax liability of
shall be determined by apportioning the net income, Kentucky
the partners, members or shareholders of the pass-through
gross receipts and Kentucky gross profits of the entire facility
entity, and shall be paid on behalf of the partners, members or
to the economic development project by a formula approved
shareholders. Enter an amount on either (a) or (b), but in no
by the Department of Revenue. A copy of the letter from the
case shall there be an entry on both (a) and (b). In accordance
Department of Revenue approving the percentage must be
with KRS 141.407(5), this estimated tax payment is excluded in
attached to the schedule.
determining each partner, member or shareholder’s distributive
share income or credit from a pass-through entity. Accordingly,
Alternative Methods—In accordance with KRS 141.407(8), if the
the partners, members or shareholders are not entitled to claim
approved company can show that the nature of the operations
any portion of this estimated tax payment against their Kentucky
income tax liability.
and activities of the approved company are such that it is not

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