Instructions For Partnership Income Tax Return (Form D-403a)

Page 4, D-403A, Web, 12-14

Telephone Companies - All income of a telephone company must be

Part 3A - Partners’ Shares of Income, Adjustments, Tax Credits

apportioned by multiplying the income by a fraction, the numerator

and Other Items

of which is gross operating revenues earned in this State plus other

revenue items attributed to this State specifically listed in G.S. 105-

Line-by-Line Instructions:

130.4(n) and the denominator of which is the total gross operating

revenue from all business done by the company everywhere less

Line 4 - Enter the same percentage used for federal income tax

uncollectible revenue. (Complete the worksheet below.)

purposes. (Line 4 is designed for partners whose share percentages

for profits and losses are the same. If one or more partners have

different share percentages for profits and losses, write “various”

Computation of Apportionment Factor for Telephone

on Line 4 for that partner and attach a schedule to the return that

Companies - Gross Operating Revenue Factor

explains the share percentages for that partner.)

Line 6 - Enter each partner’s share of the additions to income from

1. Gross Operating Revenues in North Carolina

Part 1, Line 4.

a. Gross operating revenue from local

service in N.C. ......................................

Line 7 - Enter each partner’s share of the deductions from income

b. Gross operating revenue from toll

from Part 1, Line 6.

services within N.C. ..............................

c. N.C. portion of revenue from interstate

Line 8 - Enter each partner’s share of allowable tax credits. See

toll services ...........................................

the individual income tax instructions for a detailed explanation of

d. Gross operating revenues in N.C.

available tax credits and attach a separate schedule showing the

from other services ...............................

computation of any tax credits claimed.

e. Total gross operating revenues

assignable to N.C. (Add Lines 1a - 1d)

Part 3B - Computation of North Carolina Taxable Income for

Nonresident Partners

(

)

N.C. uncollectible revenue ...................

Line 9 - Enter each nonresident partner’s distributive share of the

g. Total adjusted gross operating

guaranteed payments that are applicable to the income reported

revenues assignable to N.C.

(Line 1e minus Line 1f) .........................

on Part 1, Line 9.

2. Gross Operating Revenues Everywhere

Line 14 - Enter each nonresident partner’s distributive share of the

a. Total gross operating revenues ............

guaranteed payments that are applicable to the income reported

on Part 1, Line 10.

(

)

b. Total uncollectible revenue ...................

c. Total adjusted gross revenues

Line 16 - Partnerships must identify each nonresident partner’s

everywhere (Line 2a minus 2b) ............

share of separately stated income items and enter that amount on

3. Gross Operating Revenue Factor

Form D-403, Page 3, Part 3, Line 16.

(Divide Line 1g by Line 2c; enter amount

here and on Part 2c) ....................................

For example, special rules apply for gain from the sale, exchange,

or disposition of Internal Revenue Code section 1231 property

on which a Code section 179 expense deduction was previously

Motor Carriers – All income of a motor carrier of property or

claimed. For federal purposes, the gain is not included at the entity

passengers must be apportioned by multiplying the income by a

level but instead is passed through separately to the individual

fraction, the numerator of which is the number of vehicle miles in this

partners. As a result, the gain is included in income on the partner’s

State and the denominator of which is the total number of vehicle

income tax return but is not included as part of the partner’s share

miles of the company everywhere. The words “vehicle miles” mean

of the partnership’s income. The partnership should assume that

miles traveled by vehicles owned or operated by the company

the partner claimed all Code section 179 expense allocated to the

hauling property for a charge, carrying passengers for a fare, or

partner.

traveling on a scheduled route. (Complete the worksheet below.)

Part 3C - Computation of Tax Due for Nonresident Partners on

Whose Behalf the Partnership Pays the Tax

Computation of Apportionment Factor for Motor

Carriers - Vehicle Miles Factor

Line 18 - Compute the tax due for each nonresident partner and

enter the amounts for each partner on Line 18.

1. Number of vehicle miles traveled in N.C. ..

2. Total number of vehicle miles

Line 20 - If the total amount of tax for each nonresident partner

traveled everywhere ..................................

shown on Line 18 is more than each nonresident partner’s tax credits

3. Percentage of Mileage in N.C. Factor

shown on Line 19, subtract and enter the result on Line 20, Net Tax

(Divide Line 1 by Line 2; enter amount

here and on Part 2c) ..................................

Due. Enter the net tax due for nonresident partners on Line 13,

Page 1. The manager of the partnership is responsible for payment

of the total tax, penalties, and interest due for each nonresident

partner and must furnish each nonresident partner information to

be included with his individual income tax return verifying the tax

paid on his share of the partnership earnings in North Carolina.

Instructions For Partnership Income Tax Return (Form D-403a) - 2014 Page 5

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