Form Tc-65 - Partnership/ Limited Liability Partnership/ Limited Liability Company - 2012 Page 10
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26Schedule A · Utah Taxable Income for
Pass-through Entity Taxpayers Instructions
Line 1 – Net Income (Loss)
Example: Interest and dividends may be considered
portfolio income if the pass-through entity had funds that
Enter the net income (loss) from the federal form 1065,
were not used to further the trade or business and were
Schedule K, Analysis of Net Income (Loss), line 1.
invested and generated interest or dividends. Interest
Note: This is not line 1 of Schedule K for ordinary
and dividends are not considered portfolio income if
business income (loss).
the entity’s primary business activity is investing funds,
such as with a brokerage fi rm.
Line 2 – Contributions
Enter the charitable contributions shown on the federal
Sales of Utah property and rents received on Utah
form 1065, Schedule K, line 13.
property, if not part of the trade or business of the
partnership, are considered Utah non-business income
Line 3 – Foreign Taxes
and included on line 10.
Enter the amount of foreign taxes deducted on federal
See the defi nition of Portfolio Income on page 3.
form 1065, Schedule K, line 16.
The following are examples of income which would be
Line 4 – Recapture of Section 179 Deduction
considered business income and not portfolio income
Enter the gain or loss on the sale, exchange or other
and should not be included on line 9:
disposition of property for which a section 179 expense
• Interest income on loans and investments made
deduction has been passed through to partners and
in the ordinary course of a trade or business of
reported on federal Schedule K, line 20, code M.
lending money.
Line 5 – Total Income
• Interest income on accounts receivable arising from
Add the amounts on lines 1 through 4.
the performance of services or sales of property.
• Income from investments made in the ordinary
Line 6 – Total Guaranteed Payments to Partners
course of a trade or business of furnishing insurance
Enter the total guaranteed payments made to partners
or annuity contracts or reinsuring risks underwritten
as reported on the federal partnership return, Form
by insurance companies.
1065, Schedule K, line 4.
• Income or gain derived in the ordinary course of an
Line 7 – Health Insurance Included in
activity of trading or dealing in any property if such
Guaranteed Payments
activity constitutes a trade or business (unless the
Enter the total of any health insurance included in the
dealer held the property for investment at any time
guaranteed payments reported on line 6. This amount
before such income or gain is recognized).
should equal the total of the amounts paid during the
• Royalties derived by the taxpayer in the ordinary
taxable year for insurance that constitutes medical
course of a trade or business of licensing intangible
care for the partner (including the partner’s spouse and
property.
dependents) and reported on federal Schedule K line
13d and federal Schedule K-1, line 13, using code M.
• Amounts included in gross income of a patron of a
cooperative by reason of any payment or allocation
Line 8 – Net Guaranteed Payments to Partners
to the patron based on patronage occurring with
Subtract the health insurance on line 7 from the guar-
respect to a trade or business of the patron.
anteed payments on line 6. This amount should agree
• Other income identifi ed by the IRS as income
with the amount reported on the federal partnership
derived by the taxpayer in the ordinary course of a
return, Form 1065, Schedule M-1, line 3.
trade or business.
Line 9 – Total Portfolio Income
Line 10 – Utah Net Nonbusiness Income
Enter the total of all portfolio income included in line 1.
Enter the Utah nonbusiness income net of expenses.
Deductions attributable to portfolio income are reported
as “other deductions” on federal Schedule K box 13d
Sales of Utah property and rents received on Utah
and federal Schedule K-1 box 13, using codes I, K or
property, if not part of the trade or business income
L, and should not be subtracted from portfolio income
of the partnership, are considered Utah nonbusiness
on this line.
income.
Portfolio income is attributable to the resident state.
To calculate this amount, use form TC-20, Schedule H,
available at tax.utah.gov/forms. Enter the amount from
Interest, dividends, royalties, etc., earned in the ordinary
line 14 of Schedule H. Attach a copy of the Schedule
course of the trade or business of the partnership, are not
H to your partnership return.
portfolio income and should not be included on this line.
Note: Do not include as nonbusiness income any in-
come reported on line 9 as portfolio income.
Page 8
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