Form AR1050-Inst Partnership Tax Return Instructions

or (800) 882 9275 Act 1283 of 1999 Under this act income attributable to an investment partnership s qualifying investment securities would not be taxed if distributed to a nonresident partner In vestment partnership is defined as a partnership with at least 90% of its assets comprised of investment securities plus office equipment Only income derived from dividends interest and gains would be excluded from a nonresident partner s income The provisions of this act do not apply to income derived from investment activity that is interrelated with any trade or busi ness activity of the nonresident or an Arkansas entity in which the nonresident owns an interest Arkansas adopted section 179 of the Internal Revenue Code of 1986 as in effect on January 1 2009 regarding depreciation and expensing of property for the purpose of computing Arkansas income tax liability DEDUCTIONS Do not list deductions here if they have already been included on Lines 1 through 10 Enter each partner s name address Social Security Number and share of the net income whether distributed or not If the distributed income is determined on a basis other than a percentage basis attach an explanatory statement File Form AR1050 for the calendar year or the fiscal year Fiscal year corporation returns must be filed on or before the fifteenth (15th) day of the third (3rd) month following the close of the fiscal year (Calendar year corporation returns are filed on or before March 15 ) All other fiscal year returns must be filed on or before the fifteenth (15th) day of the fourth (4th) month following the close of the fiscal year (All other calendar year returns are filed on or before April 17 2012 ) The form should be mailed to State Income Tax P O Box 8026 Little Rock AR 72203 8026 Form AR1050 is used to file the income of a partnership Every domestic or foreign partnership doing business within the State of Arkansas or in receipt of income from Arkansas sources regardless of amount must file an AR1050 This form is also to be used by business organizations that are two or more member limited liability companies unless the LLC has checked the box to file as a corporation for federal tax purposes (Non resident partners may choose to be included in an Arkansas composite filing For details see instructions for AR1000CR ) GENERAL INSTRUCTIONS INCOME Individual Income Tax Information Line 1 Enter gross receipts or sales from all business op erations other than those listed on Lines 4 through 10 Line 10 Enter any other taxable income not included on Lines 3 through 9 Attach statement or sched ule Line 11 Add Lines 3 through 10 and enter the total Line 12 Enter the amount of salaries and wages paid Line 13 Enter the amount of payments or credits to a partner for services Line 14 Enter rent paid on business property Line 15 Enter the amount of interest paid on business indebtedness to others Line 16 Enter taxes paid or incurred on business property for carrying on a trade or business Line 17 Enter the amount of bad debts You may deduct bad debts when they become worthless or make a reasonable addition to a reserve for bad debts Attach schedule Line 18 Enter the cost of incidental repairs that do not add to the value of the property or appreciably prolong its life Line 19 Enter the allowable amount for depreciation of business property Arkansas adopted IRC 179 as in effect on January 1 2009 thus allowing greater dollar limits and phase out thresholds The maximum deduction allowed for property placed in service during the tax year is now $25 000 The deduction is decreased dollar for dollar for prop erty over $200 000 and no deduction is allowed for property over $225 000 (Arkansas has not yet adopted the most recent federal changes ) Attach schedule Line 2 Complete Schedule A on Page 2 of AR1050 Enter on Line 2 the amount shown on Line 7 of Schedule A Line 20 Enter the amount of depletion Attach schedule Line 21 Enter the contributions made by the partnership for its common law employees under a qualified retirement plan Attach schedule Line 22 Enter any other deductions not included in Lines 12 through 21 Attach schedule Line 23 Add Lines 12 through 22 and enter the total Line 3 Subtract cost of goods sold Line 2 from gross re ceipts or sales Line 1 and enter the difference Line 4 Enter the income from any other partnerships or fiduciaries Attach schedule/federal schedule Line 5 Enter the amount of interest and/or dividends received or credited to the account of the partner ship Attach schedule/federal schedule Line 6 Enter the net profit/loss for the rent of property Attach schedule/federal schedule Line 7 Enter the net profit/loss received as royalties At tach schedule/federal schedule Line 8 Enter the net profit/loss received from farming Attach schedule/federal schedule Line 9 Enter the net profit/loss from the sale of capital assets Attach schedule/federal schedule LINE BY LINE INSTRUCTIONS PARTNERS SHARES OF INCOME Partnership Income Tax Instructions Partnership Instr (R 10/7/11) Partnership Instr (R 7/13/2011) Partnerships and LLCs File Same as Federal (Act 965 of 2003) Reminders: SCHEDULE A COST OF GOODS SOLD SCHEDULE B BALANCE SHEET Section 179 Depreciation (Act 372 of 2009) STATE OF ARKANSAS Taxpayer Services Branch (501) 682 1100 The balance sheet is to report the assets and liabilities at the beginning and end of the tax year The amounts should agree with the partnership s books and records Attach a statement explaining any differences This act adopts the federal check the box regulations and requires partnerships and LLCs to file in the same manner in which the entity files and pays federal income tax To compute amounts to enter in the Arkansas column use an allocation method based on direct accounting The allocation method must be both rational and consistent To compute the cost of goods sold answer all questions and enter the amount listed on Line 7 of Schedule A on Line 2 page 1 of AR1050 WHEN AND WHERE TO FILE You can find more information about Arkansas tax code by visiting the Department of Finance and Administration web site at www arkansas gov/incometax