Form 2330 - Apportionment Schedule C Financial Institutions Page 2
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2Instructions For Apportionment Schedule C
Who may apportion income?
A taxpayer must have income from business activity taxable by this state and at least one other state to apportion income.
The income of the taxpayer is divided between the states in which the business is conducted pursuant to the property, payroll,
receivables and deposits apportionment factors. If one or more of the four factors does not exist (that is, there is no denominator)
determine the apportionment factor (Schedule C, Line 5) by dividing by the number of factors used.
Taxable in Another State:
A taxpayer is “taxable in another state” if, by reason of business activity in another state, it is subject to and did pay one of the
types of taxes specified: a net income tax, a franchise tax measured by net income, a franchise tax for the privilege of doing
business, or a corporate tax. The taxpayer must carry on business activities in another state. If the taxpayer voluntarily files
and pays one or more of such taxes when not required to do so by the laws of that state or pays a minimal fee for qualification,
organization or for the privilege of doing business in that state, but does not actually engage in business activities in that state, and
does not have business facilities in that state or does actually engage in some activity, not sufficient for nexus, and the minimum
tax bears no relation to the corporation’s activities with such state, the taxpayer is not “taxable” in another state.
1. Property Factor: The denominator, Column (a), is the average value of all the taxpayer’s real and tangible personal property
owned or rented and used during the income year for the production of income. The numerator, Column (b), of the property factor
shall include the average value of the taxpayer’s real and tangible personal property owned or rented and used in this state or in
another state which does not subject the taxpayer to a tax described in the above instruction, “Taxable in Another State,” during
the income year. An automobile assigned to a traveling employee shall be included in the numerator of the factor of the state to
which the employee’s compensation is assigned under the payroll factor or in the numerator of the state in which the automobile is
licensed.
Property owned by the taxpayer shall be valued at its original cost. As a general rule “original cost” is deemed to be the basis
of the property for federal income tax purposes (prior to any federal adjustments) at the time of acquisition by the taxpayer and
adjusted by subsequent capital additions or improvements thereto and partial disposition thereof, by reason of sale, exchange,
abandonment, etc. Property rented by the taxpayer is valued at eight times the net annual rental rate. The net annual rental rate
is the total annual rental rate paid by the taxpayer, less total annual rental rates received by the taxpayer from subrentals. As a
general rule the average value of property owned by the taxpayer shall be determined by averaging the values at the beginning
and ending of the income year. However, the Director of Revenue may require averaging by monthly values if such method of
averaging is reasonably required to properly reflect the average value of the taxpayer’s property for the income year.
2. Payroll Factor: The payroll factor includes only compensation which is attributable to the income subject to apportionment. The
denominator, Column (a), of the payroll factor is the total compensation paid everywhere during the income year.
The numerator, Column (b), of the payroll factor is the total amount paid in this state or in another state which does not subject
the taxpayer to a tax described in the above instruction, “Taxable in Another State,” during the income year by the taxpayer
for compensation. Compensation is paid in this state if any one of the following tests, applied consecutively, are met: a) The
employee’s service is performed entirely within this state; b) The employee’s service is performed both within and without this
state, but the service performed without this state is incidental to the employee’s service within the state (the word “incidental”
means any service which is temporary or transitory in nature, or which is rendered in connection with an isolated transaction); c)
If the employee’s services are performed both within and without this state, the employee’s compensation will be attributed to this
state: (i) if the employee’s base of operations is in this state; or (ii) if there is no base of operations in any state in which some
part of the service is performed, but the place from which the service is directed or controlled is in this state; or (iii) if the base
of operations or the place from which the service is directed or controlled is not in any state in which some part of the service
is performed but the employee’s residence is in this state. The term “base of operation” is the place of more or less permanent
nature from which the employee starts his work and to which he customarily returns in order to receive instructions from the
taxpayer or communications from his customers or other persons, or perform any other functions necessary to the exercise of his
trade or profession at some other point or points.
3. Receivables Factor: The denominator, Column (a), of the receivables factor is the total average daily contract obligations owing to
the taxpayer everywhere during the income period. The numerator, Column (b), of the receivables factor is the average
daily contract obligations owing to the taxpayer on an open account held by an office, facility or branch in Missouri or in another
state which does not subject the taxpayer to a tax described in the above instruction, “Taxable in Another State”.
4. Deposits Factor: The denominator, Column (a), of the deposits factor is the total average daily deposits everywhere during the
income period. The numerator, Column (b), of the deposits factor is the average daily deposits held by an office facility or branch
in Missouri or in another state which does not subject the taxpayer to a tax described in the above instruction, “Taxable in Another
State”.
Note: Percentages on Lines 1–5 should be extended to four digits to the right of the decimal.
Form 2330 (Revised 12-2013)
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