Instructions For Arizona Form 140nr - Nonresident Personal Income Tax Return

Arizona Form 140NR

claim the credit. If you claim this credit, enter the amount of

state as a nonprofit medical marijuana dispensary, you are

such expenses that you deducted on your federal return.

required to add the amount of the loss from the dispensary

that is included in the computation of your federal adjusted

H. Motion Picture Expenses

gross income. Include the amount of the loss on line 29.

If you claim a motion picture credit (Form 334), you cannot

deduct any expenses related to the production or related to a

NOTE:

If the Arizona nonprofit medical marijuana

transferred credit. Enter the amount of any such expenses

dispensary is registered with the Arizona Department of

that were deducted in computing Arizona gross income for

Health

Services

anything

other

than

sole

which you claimed a credit.

proprietorship, this addition does not apply.

I. Adjusted Basis in Property for Which You Have

Arizona

Long-Term

Health

Care

Savings

Claimed a Credit for Investment in Qualified Small

Account (AZLTHSA) Withdrawals

Businesses

You must add amounts withdrawn from your AZLTHSA if

If you claim a credit for an investment in a qualified small

you withdrew money for purposes other than paying

business (Arizona Form 338), you must adjust your basis in

qualified long-term health care expenses.

For more

the investment by the amount of the credit claimed. You

information, see A.R.S. § 43-1032.

must report this difference in basis on the Arizona return that

N. Other Adjustments

you file for the taxable year in which you sell or otherwise

dispose of the investment. If you sold or otherwise disposed

Other special adjustments may be necessary. You may need

of the investment during the 2014 taxable year, enter the

to make an addition for depreciation or amortization. You

amount by which the adjusted basis computed under the IRC

may also need to make an addition if you claimed certain tax

with respect to that property exceeds the adjusted basis of

credits. Call one of the numbers listed on page 1 if any of

the property computed under A.R.S. § 43-1074.02.

the following apply.



J. Original Issue Discount (OID) on Reacquisition

You sold or disposed of property that was held for the

of Debt Instrument

production of income and your basis was computed

under the Arizona Income Tax Act of 1954, as amended

For federal purposes, when a taxpayer made the special election

(1978 prior) except depreciable property.

to defer discharge of indebtedness (DOI) income under IRC §



You claimed the environmental technology facility

108(i) (for 2009 or 2010), the taxpayer was not allowed to take

credit.

a deduction with respect to the portion of any OID that accrued



You claimed the pollution control credit.

with respect to that DOI income, during the income deferral



You claimed the recycling equipment credit.

period. In this case, the taxpayer had to deduct the aggregate



You claimed the agricultural pollution control equipment

amount of the OID deductions disallowed ratably over a 5-year

credit.

period, beginning with the period in which the income was



You elected to amortize cost of a childcare facility

includible in federal adjusted gross income.

under Arizona law in effect before 1990. You are still

Arizona did not adopt the federal provisions requiring a

deducting amortization or depreciation for that facility

taxpayer to defer the OID deduction in cases where the

on your federal income tax return.

taxpayer federally deferred the DOI income. For Arizona

Line 30 - Subtotal

purposes, you had to report the Arizona source DOI income

Add lines 26, 28, and 29.

from a debt reacquisition in the year in which you reacquired

the debt, and you were allowed to subtract any OID related to

Subtractions From Income

that DOI income in the year the OID accrued. (See the

instructions for line 46, “Other Subtractions From Income.”)

You may only subtract those items for which statutory

If your Arizona gross income includes a deduction for any

authority exists. Without such authority, you cannot take a

accrued OID that you have already subtracted for Arizona

subtraction. You may not subtract any amount which is

purposes, you must make an addition to Arizona income for

allocable to income excluded from your Arizona income. If

you have any questions concerning subtractions from income,

the amount of deferred OID deducted on your federal return

call one of the numbers listed on page 1 of these instructions.

that you included in your Arizona gross income.

Generally, this addition will not apply until taxable year 2014

NOTE: If you reported a net capital gain or (loss) on your

through 2018. On line 29, enter the amount of any previously

federal tax return, you must enter the amount of the net gain

or (loss) from Arizona sources, line 31. See the instructions

deferred OID that you deducted in computing your 2014

for line 31.

Arizona gross income, to the extent that the amount was

previously subtracted from Arizona gross income.

If you are taking a subtraction for any net long-term capital

gain from assets acquired after December 31, 2011, you

K. Qualified Health Insurance Plans

must also complete lines 33 and 34. If you do not complete

If you claimed a credit on AZ Form 347, you may not deduct

these lines, you cannot take the subtraction.

any expenses for which you claim the credit. If you take this

You may subtract a percentage of any net long-term capital

credit, enter the amount of such expenses that you deducted

gain included in your federal adjusted gross income that is

on your federal return.

derived from an investment in an asset acquired after

L. Sole Proprietorship Loss of an Arizona Nonprofit

December 31, 2011. For 2014, the percentage is 20% (.20).

Medical Marijuana Dispensary Included in Federal

As a nonresident, you may take the allowable subtraction for

Adjusted Gross Income

only those qualified net long-term capital gains that are from

Arizona sources. Use the worksheet at the end of these

If you are registered as an Arizona sole proprietorship with

instructions, Worksheet for Net Long-Term Capital Gain

the Arizona Department of Health Services to operate in this

Instructions For Arizona Form 140nr - Nonresident Personal Income Tax Return - 2014 Page 8

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