Instructions For Schedule U-M - Member'S Income And Expenses

Pre-consolidation separate company: If the member is filing its federal return as part of a consolidated

group, each member of the federal consolidated group that is also part of the Massachusetts combined

group must file a separate Schedule U-M and report in Schedule U-M, column (a) the separate amounts

referenced for the member on the consolidation schedule filed with the federal consolidated tax return

before any eliminations or consolidation adjustments. In these cases, each member of the federal

consolidated group must check the “pre-consolidated separate company” box.

Separate U.S. 1120 as filed: If the member is filing U.S. Form 1120 on a separate company basis it must

check the box “separate U.S. 1120 as filed” and report in Schedule U-M, column (a) the amounts

referenced on its federal income tax return.

Pro-forma, U.S. 1120S filed: If the member is filing U.S. Form 1120S it must report, in column (a) the

member’s pro-forma federal totals including the gross income and expenses of a qualified subchapter S

subsidiary, if any, but without taking into account subchapter S of the Internal Revenue Code (I.R.C.).

Each S corporation filing Schedule U-M must check the box “pro-forma, U.S. 1120S filed.”

Pro-forma, other U.S. return filed: If the member is filing any U.S. income tax return other than from

1120 or 1120S (e.g. Form 1120F or 1120-REIT), it must report in column (a) the income and deductions

referenced on that return. Amounts not included on the federal return (e.g. any U.S. source income of

non-U.S. corporations that was not reported on U.S. form 1120F), will be reported in column (c). Each

such member will check the box “pro-forma, other U.S. return filed.”

Pro-forma, no U.S. return filed: If the member is not filing a U.S. Income tax return for any reason, it

must check the box “pro-forma, no U.S. return filed” and leave column (a) blank. All income and

deductions of such corporations is reported in column (c). See below for more information on filing

Schedule U-M where the combined group member is a non-U.S. corporation, including the situation

where the combined group has made and is subject to a worldwide election.

Eliminations: If the members of the combined group have engaged in one or more transactions as

between one another that require inter-company elimination as to such transactions for Massachusetts

purposes, the principal reporting corporation shall check the eliminations box and file a separate

Schedule U-M as an “eliminations schedule” for the combined group. The additional “group” Schedule

U-M, i.e., the eliminations schedule, shall be in addition to the other Schedule U-M’s to be filed by the

members of the combined group. Entries on the elimination schedule are to be made in columns (a) and

(f). See below for further details on filing the eliminations schedule.

Instructions For Schedule U-M - Member'S Income And Expenses - 2012 Page 3