Form 355s - Massachusetts S Corporation Excise Return

Line by Line Instructions

◗ certified industrial waste and/or pollution treat-

ment percentage. If all business is conducted in

Schedule CR. Other

ment facilities of prior years; or

Massachusetts, 100% (1.00) should be entered in

line 22.

Corporate Credits

◗ certified solar/wind units of current or prior

years, if said facilities were sold during the year.

Line 24

(See M.G.L. Ch. 63, sec. 38D(d) and sec. 38H(e)

Schedule CR is used to calculate the total of any

A deduction is allowed for expenditures paid or in-

for further explanation.)

credits being claimed for use in the current tax year.

curred during the taxable year for the installation of

Capital gains on installment sales of intangible

Corporations which are members of a combined

any solar or wind powered climate control or water

property made prior to 1963 may also be deducted

group required to file Form 355U that must pay

heating unit. Ancillary units do not qualify.

from income. These gains fall under the provisions

an excise with this return (corporations with a fis-

In order to be eligible for this deduction, the prop-

of prior Massachusetts law when such income

cal year ending at a different time than the taxable

erty must be certified by the Office of Facilities

was not taxable (see M.G.L. Ch. 63, sec. 38(a)(2)).

year for which the combined report is being filed)

Management. A copy of such certification must be

This adjustment should be made in line 8.

should report on Schedule CR only the type and

available along with a schedule itemizing the:

amount of credit(s) being claimed against the ex-

Deduct the full U.S. research credit generated pro-

◗ cost;

cise shown on this return.

vided that the full U.S. research credit was taken. If

◗ allowable U.S. depreciation;

a reduced U.S. research credit was taken, no ad-

Schedule E-2

justments are necessary.

◗ date of installation; and

From Massachusetts Schedule RC, Part 1, line 21,

◗ place of installation.

Loss Carryover Deduction

add back the full Massachusetts research credit

If these amounts are prorated, the computation

Massachusetts allows two different loss carryover

generated.

should be explained.

deductions, a deduction available only to corpora-

The deduction allowed to a corporation for any ex-

tions during the first five years of the corporation's

If eligible units do not continue in qualified use for

pense which qualifies for the Massachusetts Re-

existence and a deduction generally available to all

ten years, the deductions previously allowed must

search Credit must be reduced by the Massachu-

business corporations. A corporation may take

be added back to taxable income. The amount

setts Research Credit determined in the current

only one of these deductions in a taxable year. If

should be entered in Schedule E, line 13.

taxable year. In addition, subsection (c) of IRC sec.

the corporation qualifies to take either deduction,

280C, which requires a similar reduction of the de-

Note: The special deduction for the construction

the choice between the deductions is left to the

duction, shall not apply in determining Massachu-

of certified industrial waste and/or air pollution

corporation's discretion. Note that a corporation

setts net income.

treatment facilities does not apply to expenditures

electing the “new corporation” NOL must reduce

paid or incurred on or after January 1, 1980.

Capital loss carryovers are not allowed under Mass-

its net operating loss for amounts carried back for

achusetts law. Any loss claimed on the U.S. return

purposes of determining the federal net operating

Line 26

must be added back here.

loss deduction. See 830 CMR 63.30.2(3).

Enter the amount of the corporation's loss carry-

If the corporation has income not subject to ap-

over deduction from Schedule E-2, line 8.

Lines 1 through 4

portionment, the amount should be deducted here

For each of lines 1through 4, enter the appropriate

Line 27

and entered on Schedule E, line 22.

amounts for each of the items listed if the (a) the

Subtract the amount on line 26 from the amount

If the corporation has qualified taxable income and

corporation sustained a Massachusetts net oper-

on line 25. Enter this amount in the excise calcula-

passive income, the amount should be deducted

ating loss in the relevant year and (b) the corpora-

tion section, line 5.

here and entered on the Excise Calculation Sched-

tion was taxable on its income in Massachusetts.

ule, line 3.

If the corporation was organized after the year in

Corporate

question, was not taxable in Massachusetts or did

Line 15

not sustain a Massachusetts net operating loss,

Enter the total cost of renovating an abandoned

Disclosure Schedule

leave all fields for that year blank.

building in an Economic Opportunity Area. Multi-

ply this amount by 10% and enter here.

Row a

Chapter 402 of the Acts of 1992 require the De-

Enter the amount of any pre-apportionment net

partment of Revenue to conduct an annual analysis

Line 16

operating loss shown on the corporation's Mass-

of corporate tax liability. To provide the department

Refer to Schedule E-1 for the allowable deductions

achusetts return.

with information necessary to complete this analy-

for dividends. Dividends from a Massachusetts

sis, corporations are required to report amounts

Row b

corporate trust, a non-wholly-owned DISC or a

taken federally for charitable contributions, re-

Enter the amount of any pre-apportionment net

corporation of which less than 15% of the voting

search expenses and certain types of depreciation.

operating loss used in a prior year.

stock is owned are not deductible. Also, direct or

All corporations must complete the Corporate Dis-

indirect dividends received from a RIC or REIT

Row c

closure Schedule on their return or the return will

are not deductible.

Subtract the amount used from the original loss.

be considered insufficient and will be subject to

applicable penalties and interest.

Line 20

Row d

If the corporation conducts business activities in

Enter the apportionment factor shown on the cor-

another state sufficient to give that state the juris-

poration's Massachusetts corporate excise tax re-

diction to tax the corporation, Schedule F should

turn for the loss year. If the corporation was not

be completed in order to determine the apportion-

taxable in any other state, enter 1.000000.

Form 355s - Massachusetts S Corporation Excise Return - 2012 Page 12

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