Looking for a Minnesota Tax Forms And Templates? Download it for free!

Schedule M4NPA

Sales

Complete Schedule M4NPA if you conduct

Intangible Property

business both in and outside Minnesota.

Sales of intangible property are attributed

Line 6

to the state in which the property is used by

Single-Sales Factor

Sales or Receipts

the purchaser.

Enter your sales in Minnesota (see Deter-

Apportionment

Royalties, fees and similar income re-

mining Minnesota Sales below) for the tax

After a number of years of increasing the

ceived for the use of, or privilege of using,

year in column A and your total sales in

weight of the sales factor and decreasing

intangible property (such as patents, copy-

column B.

the weights of the property and payroll

rights, trade names, franchises or similar

factors in the three-factor apportionment

Determining Minnesota Sales

items) are attributed to the state in which

formula, Minnesota has now fully transi-

the property is used by the purchaser.

Real Property

tioned to the single-sales factor apportion-

Sales, rents, royalties and other income

Intangible property is attributed to Min-

ment method.

from real property are attributed to the state

nesota if the purchaser uses the property, or

in which the property is located.

Financial institutions, read Apportionment

rights in the property, to conduct business

for Financial Institutions on page 7.

within this state, regardless of the location

Tangible Personal Property

Sales of tangible personal property are

of the purchaser’s customers.

Nonapportionable Income

attributed to Minnesota if the property is

If the property is used in more than one

Line 2

received by the purchaser within Minne-

state, then the sales or royalties must be

sota and the taxpayer is taxed in this state,

Nonbusiness income is income that can-

apportioned to Minnesota pro rata based on

regardless of the f.o.b. point, other condi-

not be apportioned because of the United

the portion of use within this state. If you

tions of sale, or the ultimate destination of

States Constitution. Nonbusiness income is

cannot get the portion of use in Minnesota,

the property.

allocated by assignment based on the type

then exclude the sales or royalties from

of property that gives rise to the income.

Tangible personal property delivered to

both the numerator and the denominator of

Nonapportionable income must be reduced

the sales factor.

a common or contract carrier or foreign

by the expenses incurred to generate the

vessel for delivery to a purchaser in another

Services

nonapportionable income.

state or nation is a sale in that state or na-

Receipts from the performance of services

tion regardless of the f.o.b. point or other

Frequently used assignment rules are:

are attributed to the state in which the ser-

conditions of sale.

vices are received.

• Income/gains from tangible property not

Property is received by a purchaser in Min-

employed in the trade or business is al-

Receipts from services provided to an orga-

nesota if the recipient is located in Min-

located to the state in which the property

nization may only be attributed to a state in

nesota, even if the property is ordered from

is located.

which it has a fixed place of doing business.

outside Minnesota.

• To determine the gain or loss on the sale

If you cannot determine where the service

of a partnership’s interest not employed in

Sales of tobacco products, beer, wine and

was received, or if it was received in a state

the trade or business, divide the original

other alcoholic beverages to someone

where the organization doesn’t have a fixed

cost of the partnership’s tangible prop-

licensed to resell the products only within

place of business, use the location of the of-

erty in Minnesota by the original cost of

the state of ultimate destination is a sale in

fice of the customer from which the service

all tangible property of the partnership.

the destination state.

was ordered.

(Tangible property includes real estate,

Receipts from leasing or renting tangible

inventory and equipment.) If you do not

If you cannot determine the ordering office,

personal property, including finance leases

have these numbers, contact the partner-

use the office location to which the service

and true leases, are attributed to the state

ship.

was billed.

in which the property is located. Receipts

If more than 50 percent of the partner-

from the lease or rental of moving property

Line 7

ship’s assets are intangibles, the gain/

are attributed to Minnesota to the extent the

Unitary businesses: Column A must be the

loss is allocated to Minnesota using the

moving property is used in Minnesota.

total of all business activities attributable

partnership’s prior year’s sales factor.

to Minnesota. Column B must include the

The extent of use is determined as follows:

total values of all business activities con-

Other assignment rules are in M.S. 290.17,

• A motor vehicle is used wholly in the

subd. 2. Income not assigned in any particu-

ducted within and outside of Minnesota.

state in which it is registered.

lar manner is allocated by assignment to the

A unitary business exists whenever there

• Receipts from rolling stock are assigned

taxpayer’s state of domicile.

is a unity if ownership, operation and use.

to Minnesota in the ratio of miles trav-

Business income is all income except

Unity is also presumed when business ac-

eled in Minnesota to total miles traveled.

tivities or operations are of mutual benefit

nonbusiness income. Business income is

• Receipts from aircraft are assigned to

to, dependent upon or contributory to one

subject to apportionment.

Minnesota in the ratio of landings in

another, either individually or as a group.

Minnesota to total landings.

A business is unitary if there is functional

• Receipts from vessels, mobile equipment

integration, centralized management and

and other mobile property are assigned

economies of scale (M.S. 290.17, subd. 4).

to Minnesota in the ratio of days the

property is in Minnesota to the total days

Continued

of the tax year.

Minnesota Unrelated Business Income Tax (Ubit) Instructions - Minnesota Department Of Revenue - 2017 Page 6

Related Articles

Related forms

Related Categories