New York: State’s version of Schedule K-1 for corporate partners

New York: State’s version of Schedule K-1

New York State has released Form IT-204-CP—its tax year 2015 proprietary corporate partner Schedule K-1—and the related instructions. Partnerships have multiple new reporting requirements and determinations to make with respect to classifying income and expense items reportable to their Article 9-A partners, based on 2015 New York corporate tax reform.

Related content

Read Form IT-204-CP [PDF 475 KB], and the instructions [PDF 203 KB]

Form IT-204-CP relates only to corporate partners

Many of the changes to Form IT-204-CP—nearly double in size from six pages for 2014 to 11 pages for 2015—relate to receipts apportionment factor items and to identifying the proper “bucket” for various types of receipts. 

  • Many types of receipts within each “bucket” have dedicated lines on Form IT-204-CP and must be separately identified by the partnership. 
  • In some situations, only the “everywhere” denominator amount for a given type of receipt must be disclosed (i.e., effectively alleviating the partnership’s burden of making a sourcing determination). 
  • The numerators on the form that have been “grayed out” generally are receipt types that are automatically sourced at 8% to New York.  

For other types of receipts, both numerator and denominator amounts must be disclosed, thus requiring market-based (customer) sourcing determinations to be made at the partnership level. In addition, gross proceeds on sales of certain financial instruments are also required to be disclosed, along with the proper sourcing determinations. 

The new Form IT-204-CP also contemplates the qualified financial instrument (QFI) election, which may be made at the corporate level, as partnerships must indicate by checking the box whether there is at least one financial instrument that was actually marked-to-market. 

Notably, partnerships are not required to report “everywhere” amounts related to dividends and gains from stock sales (of the non-investment capital variety) and partnership interest sales. While the general receipts apportionment treatment of such receipts is exclusion from the factor altogether, this information may be needed by certain corporate partners that choose to make the 8% QFI election.  As such, partnerships with non-investment capital stock may want to consider providing this information to corporate partners anyway.

 

Read a March 2016 report [PDF 44 KB] prepared by KPMG LLP:  New York State Releases 2015 Corporate Partner Schedule K-1

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