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.
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.
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
© 2017 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.