Business Tax Return - Instructions - Classifications 1, 2, And 3 Page 2
ADVERTISEMENT
1
2Schedule A: Deductions for Business Tax Purposes
Line 1:
Enter the gross sales of services that were substantially performed in states other than Tennessee.
Line 2:
Enter the proceeds from sales of goods, wares, or merchandise returned by the customer when the sales price was refunded either
in cash or by credit. This amount should equal the amounts reported on Schedule A, Line E on all Tennessee Sales and Use Tax
Returns due from the taxpayer during the business tax reporting period.
Line 3:
Enter the gross sales amount for bona fide sales in interstate commerce where the purchaser took possession outside Tennessee
for use or consumption outside Tennessee and the item was actually delivered by the seller or a common carrier.
Line 4:
Enter the total amounts of cash discounts allowed and taken on sales made during the taxpayer’s business tax reporting period.
These amounts are included on Schedule A, Line I on all Tennessee Sales and Use Tax Returns due during the business tax
reporting period.
Line 5:
Enter that portion of the unpaid principal balance in excess of $500 due on all items of tangible personal property repossessed from
customers during the taxpayer’s business tax reporting period. This amount should equal the amounts reported on Schedule A,
Line H of all Tennessee Sales and Use Tax Returns due during the business tax reporting period.
Line 6:
Enter the total amount allowed as trade-in value for any articles sold during the taxpayer’s business tax reporting period. These
amounts are included on Schedule A, Line I on all Tennessee Sales and Use Tax Returns due during the business tax reporting
period.
Enter the total amount of bad debts written off during the business tax reporting period and eligible to be deducted for federal
Line 7:
income tax purposes.
Line 8:
Enter the total amount paid by a contractor to a subcontractor holding either a business license or contractor’s license for perform-
ing activities described in Tenn. Code Ann. Section 67-4-708(4)(A). To receive the deduction, contractors must attach
Schedule B, listing the names and license numbers of the subcontractors, the amount paid to each subcontractor, and the
date paid. A copy of Schedule B is available at
Note: For federal and state privilege and excise taxes deducted on Lines 9 through 16, the deductions may be taken by the taxpayer who
made direct payment of the taxes to the applicable government agency and by all subsequent resellers of the product on which the tax was
paid, provided the taxpayer is licensed to do business in Tennessee. Enter the amounts of deduction taken in each line. All deductions
must have adequate records maintained to substantiate the amount claimed or they will be disallowed.
Line 9:
Deduct the Federal and Tennessee privilege and excise taxes paid for gasoline tax.
Line 10:
Deduct the Federal and Tennessee privilege and excise taxes paid for motor fuel use tax.
Deduct the Federal and Tennessee privilege and excise taxes paid for cigarettes.
Line 11:
Line 12:
Deduct the Federal and Tennessee privilege and excise taxes paid for other tobacco products.
Line 13:
Deduct the Federal and Tennessee privilege and excise taxes paid for beer.
Deduct the Tennessee special tax on petroleum products.
Line 14:
Line 15:
Deduct the Tennessee liquified gas tax for motor vehicles.
Line 16:
Deduct the 17% Tennessee beer wholesale tax.
Line 17:
Enter any other deductions from business tax for the business tax reporting period. Examples of items that may be listed in the
“Other” line are accommodation sales and proceeds of sales of school supplies and meals to students and school employees on
campus by secondary or elementary schools (but not such sales made by independent contractors).
Accommodation sales are occasional and isolated sales of tangible personal property for resale by one person regularly engaged
in the business of making sales of that type of property to another person regularly in the business of making sales of that type of
property. The amount paid by the buyer to the seller cannot exceed the amount paid by the seller to the vendor, plus freight,
storage, and transportation costs from the seller to the buyer. Accommodation sales can be deducted here if included in the gross
sales reported on Line 1 of the return.
Line 18: Calculate the total deductions by adding Schedule A, Lines 1 through 17. Enter the total here and on Page 1, Line 2.
CERTIFICATION:
Complete the certification block by signing and dating the return. If the return is completed by someone other than the taxpayer, the preparer
must sign the return and enter the preparer’s title and date the return is completed.
ADVERTISEMENT
0 votes
Related Articles
Related forms
Related Categories
Parent category: Financial