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This rule also applies to any amortization deductions claimed under IRC § 179 when the deduction

derives from the acquisition of intangible property from a related member. See DD 07-9.

To the extent that the combined group’s deductions as reported on this schedule include such expenses,

enter the amount on this line. Note that expenses between members of the same combined group that

relate to the unitary business are eliminated and should not be deductions included in the calculation of

the combined group’s taxable income. See 830 CMR 63.32B.2 (13). If one or more taxable members of

the combined group qualify for an exception to the add back requirement, complete Schedule ABIE for

each such taxpayer. Such exceptions are to be referenced on line 26.

Line 18. A taxpayer must add back to net income any related member interest expenses and costs,

including losses incurred in connection with factoring or discounting transactions. See 830 CMR 63.31.1.

To the extent that the combined group’s deductions as reported on this schedule include such expenses,

enter the amount on this line. Note that expenses as between members of the same combined group that

related to the unitary business are eliminated and should not be deductions included in the calculation of

the combined group’s taxable income. If one or more individual taxable members of the combined group

qualify for an exception to the add back requirement, complete Schedule ABI for each such taxpayer. See

830 CMR 63.32B.2 (13). Such exceptions are to be referenced on line 27.

Line 19. Massachusetts has decoupled from the American Jobs Creating Act of 2004, Public Law 108-

357. Therefore, the Massachusetts definition of corporate net income does not take into consideration the

federal production activity deduction. Enter the amount of any federal deduction taken on this line. See

TIR 05-5 for further information.

Line 20. The deduction allowed to a corporation for any expenses that qualify for the Massachusetts

research credit must be reduced by the Massachusetts research credit determined for the current taxable

year. Enter the amount of the Massachusetts research credit that was generated during the current taxable

year under either M.G.L. Ch. 63, sec. 38M or 38W on this line.

Line 22. This line is no longer used, all taxpayers enter zero. In prior years, it was used to show the

elimination of dividends from one member of the group to another. Those dividends, to the extent they

qualify for elimination as provided in 830 CMR 63.32B.2(6)(c) 4., are now shown on the schedule U-M

eliminations schedule and the amount of dividends referenced on schedule U-E, line 4 should be the

amount after such eliminations.

Line 23. Massachusetts allows a deduction of 10% of the total cost of renovating an abandoned building

in an economic opportunity area. Enter the amount of the deduction on this line.

Line 24. A public utility corporation that receives a dividend from an 80%owned public utility

corporation is allowed a 100% deduction for any dividends not eliminated under the rules stated in 830

CMR 63.32B.2(6)(c) 4. Each member claiming such a deduction must complete Schedule U-DRD. Note

that each such schedule must have the same unitary business identifier as the Schedule 355U-E to which

it relates.

The total amount of the deduction claimed on line 24 must match the total of the amounts on line 13 of all

Schedules 355U-DRD with the same unitary business identifier. The amount of the deduction may not

exceed the amount referenced on line 4 (dividends included in the combined group’s taxable income).

Line 25. A financial institution or business corporation that receives a dividend from another corporation

in which it owns at least 15% of the voting stock is allowed a 95% deduction for any dividends not

eliminated under the rules stated in 830 CMR 63.32B.2(6)(c) 4. Each combined group member that

claims such a deduction must complete Schedule U-DRD. Note that each such schedule must have the

same unitary business identifier as the Schedule U-E to which it relates.

The total amount of the deduction claimed on this line must match the total of the amounts referenced on

line 12 of all Schedules U-DRD with the same unitary business identifier. The amount of this deduction

Instructions For Schedule U-E - Massachusetts Unitary Or Affiliated Group Income - 2012 Page 3

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