Form It-711 - Partnership Income Tax General Instructions

GENERAL INFORMATION

(continued)

 For tax years beginning on or after January 1, 2008, the

INCOME APPORTIONMENT AND ALLOCATION

(Schedules 7 and 1)

Georgia apportionment ratio shall be computed by applying

only the gross receipts factor. See Rules and Regulation 560-

If any Partnership, domestic or foreign, is doing business or

7-7-.03(4)(d) for specific details.

owns property both within and without Georgia, the average

 For tax years beginning on or after January 1, 2006, a

ratio as computed in Schedule 7 should be used to compute

Georgia Net Income in Schedule 1. If the business income of

company whose net income is derived from the manufacture,

the partnership is derived from Georgia sources, from property

production, or sale of tangible personal property, and from

owned or business done within this State, and in part from

business other than the manufacture, production, or sale of

property owned or business done without this State, the tax

tangible personal property, must include gross receipts from

shall be imposed only on that portion of the business income

both activities in their receipts factor.

 For tax years beginning on or after January 1, 2006, a

which is reasonably attributable to Georgia sources and

property owned and business done within this State, to be

company whose net income is derived from business other

determined as follows:

than the manufacture, production, or sale of tangible personal

(1) Interest received on bonds held for investment and income

property, only includes in their receipts factor gross receipts

received from other intangible property held for investment

from activities which constitute the taxpayer’s regular trade

are not subject to apportionment. Rentals received from

or business.

real estate held purely for investment purposes and not

(b) Apportionment of Income; Business Joint Venture and

Business Partnerships. A corporation or partnership which

used in the operation of the business are also not subject

to apportionment. All expenses connected with the interest

is involved in a business joint venture, or is a partner in

and rentals from such investments are likewise not subject

a business partnership, must include its pro rata share of

to apportionment but must be applied against the investment

the joint venture or partnership property, payroll, and gross

income. The net investment income from intangible property

receipts values in its own apportionment formula.

shall be allocated to Georgia if the partnership’s situs is in

Georgia, or the intangible property was acquired as income

COMPUTATION OF TOTAL INCOME FOR GEORGIA

from property held in Georgia, or as a result of business done

PURPOSES (Schedule 8)

in Georgia. Net investment income from tangible property in

Schedule 8 reflects flow-through income from the federal

Georgia shall be allocated to Georgia.

return which is taxable to the individual partners. A resident

(2) Gains from the sale of tangible or intangible property not

partner is required to report his full share of partnership income

held, owned or used in connection with the trade or business of

or loss. A nonresident partner is required to report only his

the partnership, nor for sale in the regular course of business,

share of Georgia-apportioned and Georgia-allocated income.

shall be allocated to Georgia if the property sold is real or

Payments made to a partner for services rendered or interest

tangible personal property situated in this State, or intangible

on capital contributions (guaranteed payments) are not

property having an actual situs or a business situs within this

deductible when computing the partnership’s net income.

State. Otherwise the gains shall not be allocated to this State.

Schedule 8 is similar to the Federal Schedule K. Enter the total

(3) Net income of the above classes having been separately

amounts from each category on Schedule 8 where applicable.

allocated and deducted, the remainder of net business income

shall be apportioned as follows:

INCOME TO PARTNERS (Schedule 4)

This schedule provides space to show identifying information

ONE FACTOR FORMULA

and income distributable to the individual partners.

Enter for each partner: 1. Name; 2. Street and Number;

(a) Gross Receipts Formula. The gross receipts factor is the

3. City, State and Zip Code; 4. Social Security or Federal

ratio of gross receipts from business done within this State to

Identification Number; 5. Profit (Loss) sharing ratio (Enter

total gross receipts from business done everywhere.

the ending percentage that is listed on the Federal K-1); 6.

Receipts derived from the sale of tangible personal property

Georgia Source Income. If the partnership has more than

shall be deemed to have been derived from business done

5 partners, attach a separate schedule for the additional

in Georgia if they were received from products shipped to

partners in the same format.

customers in this State or products delivered within this State

Total Georgia source income may differ from total net income

to customers.

because some of the partnership income (e.g., guaranteed

When receipts are derived from business other than the sale

payments) may not be based on the profit sharing ratio, or

of tangible personal property, receipts shall be deemed to have

the partner is a Georgia resident. See example on page 8.

been derived in Georgia if received from customers within

this state, or if the receipts are otherwise attributable to this

State’s marketplace.

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Form It-711 - Partnership Income Tax General Instructions - 2015 Page 7

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