Illinois Department of Revenue
                                                                               Use for tax year ending on or 
                                                                               after December 31, 2022, and 
IL-1065 Instructions                                                           before December 31, 2023.                   2022

              What’s New?                                                                                Table of Contents

•  Illinois Net Loss deductions are to be reported on Schedule NLD,       What’s New? ........................................................ 1
Illinois Net Loss Deduction. Attach Schedule NLD to your Form 
IL-1065. 
                                                                          General Information ............................................ 1
•  IL-4562 has been updated to include 80 percent bonus 
depreciation.                                                             Specific Instructions ........................................... 7

•  Schedule 4255 has new recapture of credit lines.                       Apportionment Formulas .................................. 14 
•  IL-2220 was updated to incorporate the late-payment penalty for 
underpayment of estimated tax for filers of Forms IL-1065 and IL-         Illinois Schedule B Instructions ....................... 16
1120-ST that elect to pay pass-through entity (PTE) tax. 
                                                                          Appendix A - Extension Tax Payment 
•  Schedule B, Section B has been reformatted from horizontal to          Worksheet .......................................................... 20
vertical orientation. 
                                                                          Appendix B - Pass-through Withholding 
                                                                          Prepayment Worksheets ................................... 21 

                                                                          Appendix C - Estimated Payment and  
                                                                          Prepayment Worksheet ..................................... 23

                                         General Information
Who must file Form IL-1065?                                               If you are a member of a unitary business group, you may not file a 
                                                                          combined return, but you may have special filing requirements. See the 
You must file Form IL-1065, Partnership Replacement Tax Return, 
                                                                          instructions for Illinois Schedule UB and “What if I am a member of a 
if you are a partnership (see “Definitions to help you complete your 
                                                                          unitary group?” in the general instructions below for information about your 
Form IL-1065”) and you have base income or loss as defined under 
                                                                          filing requirements.
the Illinois Income Tax Act (IITA) allocable to Illinois.
If you are a partnership organized for the sole purpose of playing the          Form IL-1065 (R-12/22) is for tax year ending on or 
Illinois State Lottery, you are not required to file a Form IL-1065.      after December 31, 2022, and before December 31, 2023. For 
                                                                          tax years ending on or after December 31, 2021, and before 
A person transacting an insurance business organized under a              December 31, 2022, use the 2021 form. Using the wrong form will 
Lloyd’s plan of operation may file a Form IL-1065 on behalf of all its    delay the processing of your return. 
underwriters, including corporations and residents. You must refer to 
86 Ill. Adm. Code Section 100.5130, for specific instructions on how      How do I register my business?
to properly complete Form IL-1065 and determine what you need to          If you are required to file Form IL-1065, you should register with 
attach to your return.                                                    IDOR. You may register
All underwriters who are members of an insurance business organized 
                                                                          •  online with MyTax Illinois, our free online account management 
under a Lloyd’s plan of operation may be included on Form IL-1065. 
                                                                          program for taxpayers; 
No credit is allowed to any underwriter for its share of tax paid on 
Form IL-1065.                                                             •  by completing Form REG-1, Illinois Business Registration 
                                                                          Application, and mailing it to the address on the form; or
What forms must I use?                                                    •  by visiting a regional office.
In general, you must obtain and use forms prescribed by the Illinois      Visit our website at tax.illinois.gov for more information.
Department of Revenue (IDOR). Separate statements not on forms 
provided or approved by IDOR will not be accepted and you will            Registering with IDOR prior to filing your return ensures that your 
be asked for appropriate documentation. Failure to comply with            tax returns are accurately processed. 
this requirement may result in failure to file penalties, a delay         Your identification numbers as an Illinois business taxpayer are 
in the processing of your return, or a delay in the generation            your federal employer identification number (FEIN) and your Illinois 
of any overpayment. Additionally, failure to submit appropriate           account number.
documentation when requested may result in a referral to our Audit 
Bureau for compliance action.                                             When should I file?
Partnerships must complete Form IL-1065. Do not send a computer           In general, Form IL-1065 is due on or before the 15th day of the 4th 
printout with line numbers and dollar amounts attached to a blank copy of month following the close of the tax year. 
the return. Computer generated printouts are not acceptable, even if they If you are operating as a business organized under the Lloyd’s plan 
are in the same format as IDOR’s forms. Computer generated forms from     of operation, your due date is the same as your federal return due 
an IDOR-approved software developer are acceptable.                       date.
IL-1065 Instructions (R-12/22)  Printed by the authority of the State of Illinois - web only - one copy.                             Page 1 of 25

Automatic six-month extension — We grant you an automatic                Who should sign the return?
six-month extension of time to file your partnership tax return. The 
                                                                         Your Form IL-1065 must be signed by a partner or any other officer 
automatic extension of time to file is granted whether or not you 
                                                                         duly authorized to sign the return. In the case of a bankruptcy, a 
request it. You are not required to file a form in order to obtain this 
                                                                         receiver, trustee, or assignee must sign any return required to be 
automatic extension. If you expect tax to be due, you must pay any 
                                                                         filed on behalf of the partnership. The signature verifies by written 
tentative tax due, by the original due date of the return, in order to 
                                                                         declaration (and under penalties of perjury) that the signing individual 
avoid interest and penalty on tax not paid by that date. To pay any tax 
                                                                         has personally examined the return and the return is true, correct, 
due by the original due date of your return:
                                                                         and complete. The fact that an individual’s name is signed to a return 
•   visit tax.illinois.gov, for information about ACH credit,            is prima facie evidence that the individual is authorized to sign the 
• pay using mytax.illinois.gov, or                                       return on behalf of the partnership.
•   mail Form IL-1065-V, Payment Voucher for Partnership                 If you are operating as a business organized under the Lloyd’s plan of 
  Replacement Tax, using the address on the form.                        operation, an officer of that plan must sign Form IL-1065.
If an unpaid liability is disclosed when you file your return, then you  Any person paid to prepare the return (other than a regular 
may owe penalty and interest charges in addition to the tax. See the     employee of the taxpayer, such as a clerk, secretary, or bookkeeper) 
“What are the penalties and interest?” section below. An extension       must provide a signature, date the return, enter the preparer tax 
of time to file your Form IL-1065 is not an extension of time for        identification number (PTIN) issued to them by the Internal Revenue 
payment of Illinois tax.                                                 Service, and provide their firm’s name, FEIN, address, and phone 
If you are operating as a business organized under the Lloyd’s plan      number. 
of operation, the length of your Illinois automatic extension of time to       If your return is not signed, any overpayment of tax is 
file is the same as your federal extension.                              considered forfeited if, after notice and demand for signature, you fail 
Additional extensions beyond the automatic extension period —            to provide a signature within three years from the date your return 
We will grant an additional extension only if an extension is granted    was filed.
by the Internal Revenue Service (IRS) beyond the date of the Illinois 
                                                                         What are the penalties and interest?
automatic extension. Your additional Illinois extension will be for the 
length of time approved by the IRS. You must attach a copy of the        Penalties — You will owe 
approved federal extension to your Form IL-1065.                         •  a late-filing penalty if you do not file a processable return by the 
                                                                            extended due date;
When should I pay?
                                                                         •  a late-payment penalty if you do not pay the tax you owe by the 
Payment of tax — You must pay your Illinois Replacement Tax and             original due date of the return; 
pass-through withholding reported on behalf of your members or PTE 
tax in full on or before the original due date of the return. Failure to •  a late-payment penalty for underpayment of estimated tax if 
pay the tax due on or before the original due date of the return may        you were required to make estimated tax payments and failed to 
result in penalty and interest. This payment date applies even though       do so, or failed to pay the required amount by the payment due 
an automatic extension for filing your return has been granted. All         date;
payments must be made using Form IL-1065-V, Payment Voucher for          •  a bad check penalty if your remittance is not honored by your 
Partnership Replacement Tax.                                                financial institution; and
Extension Payments - If you expect tax to be due, you must pay           • a  cost of collection fee if you do not pay the amount you owe 
any tentative tax due by the original due date of the return using          within 30 days of the date printed on your bill.
Form IL-1065-V. See Appendix A for more information.                     Interest —Interest is calculated on tax from the day after the original 
Estimated tax payments — Partnerships who elect to pay PTE               due date of your return through the date you pay the tax. 
tax and reasonably expect their total tax liability to exceed $500 are   We will bill you for penalties and interest. For more information about 
required to make estimated tax payments using Form IL-1065-V. All        penalties and interest, see Publication 103, Penalties and Interest for 
other partnerships are not required to make estimated tax payments.      Illinois Taxes.
See Appendix C for more information. 
Voluntary Prepayments - Partnerships who do not elect to pay             What if I am discontinuing my business?
PTE tax or partnerships who elect to pay PTE tax and reasonably 
                                                                         Liquidation or withdrawal from Illinois — If you are a partnership 
expect their total tax liability to be less than $500, may make 
                                                                         that is liquidated or withdraws either voluntarily or involuntarily from 
voluntary prepayments of their own tax liability using Form IL-1065-V. 
                                                                         Illinois during any tax year, you are still required to file tax returns. 
Partnerships who do not elect to pay PTE tax may also use Form 
                                                                         Also, we will pursue the assessment and collection of any taxes owed 
IL-1065-V to make pass-through withholding prepayments on 
                                                                         by you or your partners.
behalf of your partner. See Appendix B and Appendix C for more 
information.                                                             Sales or transfers — If you are a partnership that, outside the usual 
We encourage you to make your payments electronically using              course of business, sells or transfers the major part of any one or more of
MyTax Illinois or Modernized E-File (MeF) systems, or you may            •  the stock of goods which you are in the business of selling,
use Form EFT-1, Authorization Agreement for Certain Electronic           •  the furniture or fixtures of your business,
Payments, to set up an ACH credit or phone debit transaction. These      •  the machinery and equipment of your business, or
options can be found on our website at tax.illinois.gov. If you make 
your payments using MyTax Illinois, MeF, or EFT, do not mail us your     •  the real property of your business,
IL-1065-V forms. You must use one of our electronic payment options      you or the purchaser must complete and send us Form CBS-1, 
if IDOR has notified you that you are required to make payments          Notice of Sale, Purchase, or Transfer of Business Assets, no later 
electronically.                                                          than 10 business days prior to the date the sale takes place. Send 
We will apply each payment to the earliest due date until that liability this form, along with copies of the sales contract and financing 
is paid, unless you provide specific instructions to apply it to another agreement, to: 
period. You may also be assessed a bad check penalty if your 
remittance is not honored by your financial institution.
Page 2 of 25                                                                                                           IL-1065 Instructions (R-12/22)

   ILLINOIS DEPARTMENT OF REVENUE                                              Should I round?
   BULK SALES UNIT
   PO BOX 19035                                                                You must round the dollar amounts on Form IL-1065 and 
   SPRINGFIELD IL  62794-9035                                                  accompanying schedules to whole-dollar amounts. To do this, you 
or                                                                             should drop any amount less than 50 cents and increase any amount 
                                                                               of 50 cents or more to the next higher dollar.
   REV.BulkSales@illinois.gov
                                                                               What if I have an Illinois net loss deduction 
What if I need to correct or change my return?
                                                                               (NLD)?
Do not file another Form IL-1065 with “amended” figures to change 
                                                                               An Illinois net loss deduction (NLD) can be used to reduce the base 
your originally filed Form IL-1065. If you need to correct or change 
                                                                               income allocable to Illinois only if the loss year return has been filed 
your return after it has been filed, you must file Form IL-1065-X, 
                                                                               and to the extent the loss was not used to offset income from any 
Amended Partnership Replacement Tax Return. Returns filed before 
                                                                               other tax year. S corporations and partnerships, including any that 
the extended due date of the return are treated as your original 
                                                                               are members of a unitary group, trusts, and non-unitary corporations 
return for all purposes. For more information, see Form IL-1065-X 
                                                                               should use the Illinois Schedule NLD, Illinois Net Loss Deduction, to 
instructions.
                                                                               determine any NLD. 
You should file Form IL-1065-X only after you have filed a processable         To determine your “Illinois net loss” start with federal taxable income 
Illinois Income Tax return. You must file a separate Form IL-1065-X for        and apply all addition and subtraction modifications and all allocation 
each tax year you wish to change.                                              and apportionment provisions.
State changes only — File Form IL-1065-X promptly if you discover              In order to have any available NLD applied to your return, you must 
an error on your Illinois return that does not relate to an error on your      claim the deduction on Step 7, Line 48. See specific instructions for 
federal return but rather was caused by                                        Step 7, Line 48.
•  a mistake in transferring information from your federal return to your      If you have an Illinois net loss for this tax year, you must file Form 
   Illinois return;                                                            IL-1065 reporting the loss in order to carry the loss forward to 
•  failing to report or misreporting to Illinois an item that has no effect on another year.
   your federal return; or                                                     If corrections have been made to the loss amount (e.g., federal audit 
•  a mistake in another state’s tax return that affects the computation of     or amended return), you must report the corrected amount when you 
   your Illinois tax liability.                                                file. 
If you are claiming an overpayment, Form IL-1065-X must be filed within               Ensure you have filed returns (i.e., Form IL-1120, Form 
three years after the extended due date or the date the return was filed,      IL-1120-ST, Form IL-1041, or Form IL-1065) for all periods in which 
or within one year after the tax giving rise to the overpayment was paid,      you were required to file an Illinois return. Unfiled returns may result 
whichever is latest.                                                           in disallowed losses, processing delays, and further correspondence 
                                                                               from IDOR. 
Federal changes only — File Form IL-1065-X if you have filed an 
amended federal return or if you have been notified by the IRS that they       If you need more information about Illinois NLD, see Schedule 
have made changes to your return. This includes any change in your             NLD instructions or the 86 Ill. Adm. Code Sections 100.2050 
federal income tax liability, any tax credit, or the computation of your       and 100.2300 through 100.2330, available on our website at 
federal taxable income as reported for federal income tax purposes, if         tax.illinois.gov.
the change affects any item entering into the computation of net income,       What are the carry provisions of the Illinois NLD?
net loss, or any credit for any year under the IITA. You must file Form 
IL-1065-X no later than 120 days after the federal changes have been           For tax years ending on or after December 31, 2021, Illinois net 
agreed to or finally determined to avoid a late-payment penalty.               losses cannot be carried back and can only be carried forward for 
                                                                               20 tax years. 
If your federal change decreases the tax due to Illinois and you 
are entitled to a refund or credit carryforward, you must file                 For tax years ending on or after December 31, 2003, and before 
Form IL-1065-X within two years plus 120 days of federal finalization.         December 31, 2021, Illinois net losses cannot be carried back, and 
                                                                               can only be carried forward for 12 years. However, the carryover 
Attach a copy of federal finalization or proof of acceptance from the          period of any net loss that had not expired as of November 16, 2021, 
IRS along with a copy of your amended federal form, if applicable, to          shall be extended from 12 years to 20 years. 
your Form IL-1065-X. Examples of federal finalization include a copy 
                                                                               For tax years ending on or after December 31, 1999, and before 
of one or more of the following items:
                                                                               December 31, 2003, all Illinois net losses must be carried back two 
•  your audit report from the IRS and                                          years (unless an election to only carry forward is made) then forward 
•  your federal record of account verifying your ordinary business             20 years. The election to carry a loss forward only was made by 
   income.                                                                     checking the appropriate box on the original or amended loss-year 
                                                                               return, whichever showed the loss first. Once the election was made 
What records must I keep?                                                      to forgo the Illinois carryback provision, the election was irrevocable. 
You must maintain books and records to substantiate any information            Losses incurred in tax years ending before December 31, 1999, 
reported on your Form IL-1065. Your books and records must be                  can be carried back and carried forward for the periods allowed 
available for inspection by our authorized agents and employees.               under Internal Revenue Code (IRC) Section 172, for the tax year in 
                                                                               which the loss was incurred. In general, losses incurred in tax years 
Do IDOR and the IRS exchange income                                            beginning 
tax information?                                                               •  after August 5, 1997, and ending before December 31, 1999, 
The IRS and IDOR exchange income tax information for the purpose               must be carried back two years, then forward 20 years.
of verifying the accuracy of information reported on federal and               •  on or before August 5, 1997, must be carried back three years, 
Illinois tax returns. All amounts you report on Form IL-1065 are               then forward 15 years.
subject to verification and audit.

IL-1065 Instructions (R-12/22)                                                                                                       Page 3 of 25

       For tax years ending on or after December 31, 1996, and              Definitions to help you complete your Form IL-1065
before December 31, 2003, you may have made the election to forgo 
any of the previously mentioned Illinois NLD carryback periods by           All references to “income” include losses.
checking the appropriate box on your loss year return. This election        Base income means federal ordinary income plus separately stated 
must have been made by the extended due date of your return and             items, modified by additions and subtractions as shown in Steps 
once made was irrevocable for that tax year.                                2 through 5 of Form IL-1065. See specific instructions for Steps 2 
In addition, the special carryover periods in IRC Section 172, as in        through 5.
effect for a particular tax year, would apply to losses incurred in that    Business income means all income (other than compensation) that 
year. For example, a “specified liability loss” incurred in 1998 may be     may be apportioned by formula among the states in which you are 
carried back 10 years under IRC Section 172(b)(1)(c).                       doing business without violating the Constitution of the United States. 
Also, no limitations under IRC Section 382 or the separate return           All income of a partnership is business income unless it is clearly 
limitation year provisions of the federal consolidated return               attributable to only one state and is earned or received through 
regulations apply to any NLD carryover.                                     activities totally unrelated to any business you are conducting in more 
                                                                            than one state. Business income is net of all deductions attributable 
What is the standard exemption?                                             to that income.
The standard exemption is $1,000 multiplied by a fraction in which          Commercial domicile means the principal place from which your 
the numerator is your base income allocable to Illinois and the             trade or business is directed or managed.
denominator is your total base income. If you have a change in your         Nonbusiness income means all income other than business income 
tax year end, and the result is a tax period of less than 12 months,        or compensation. For more information about the different types of 
the standard exemption is prorated based on the number of days in           nonbusiness income, see the instructions for Illinois Schedule NB, 
the short tax year. However, if this is your first or final return, you are Nonbusiness Income.
allowed to use the full-year standard exemption even if it is a short       A partnership is an entity that is treated as a partnership for federal 
tax year. If you need further information, see IITA Section 401(b).         income tax purposes. A partnership that elects an IRC Section 761 
       For tax years beginning on or after January 1, 2017, the             exclusion from the federal partnership provisions is also excluded for 
standard exemption may not be claimed if your unmodified base               purposes of the IITA. 
income is $250,000 or more. See Specific Instructions for more              Partner includes a person treated as a partner for federal income tax 
information.                                                                purposes.
                                                                            A resident partner means
What attachments do I need?
                                                                            •  an individual who is present in Illinois for other than a temporary or 
When filing your return there are certain types of income items 
                                                                              transitory purpose;
and subtraction modifications that require the attachment of 
Illinois or federal forms and schedules. Breakdowns, statements,            •  an individual who is absent from Illinois for a temporary or 
and other documentation may also be required. Instructions for                transitory purpose but who is domiciled in Illinois;
these attachments appear throughout the specific instructions for           •  the estate of a decedent who at his or her death was domiciled in 
completing your return.                                                       Illinois; 
If you are operating as a business organized under the Lloyd’s plan of      •  a trust created by a will of a decedent who at his or her death was 
operation, refer to 86 Ill. Adm. Code Section 100.5130, to determine          domiciled in Illinois; or
what you need to attach to your Form IL-1065.                               •  an irrevocable trust if the grantor was domiciled in Illinois at the 
       All Illinois forms and schedules include an “IL Attachment             time the trust became irrevocable. For purposes of this definition, 
No.” in the upper right corner of the form. Required attachments              a trust is irrevocable to the extent that the grantor is not treated 
should be ordered numerically behind the tax return, as indicated by          as the owner of the trust under IRC Sections 671 through 678. 
the IL Attachment No. Failure to attach forms and schedules in the            For a more detailed explanation of “domicile” and “resident,” see 
proper order may result in processing delays.                                 the General Instructions for Form IL-1040, Individual Income Tax 
Required copies of documentation from your federal return or other            Return.
sources should be attached behind the completed Illinois return.            Nonresident partner means a partner who is not a resident of 
You must attach a copy of your U.S. Form 1065, Pages 1 through 5,           Illinois, as defined previously.
to your Illinois return if you are required to file federally.              A pass-through entity is any entity treated as a partnership, 
Schedule B, Partners’ or Shareholders’ Information, must be                 subchapter S corporation, or trust for federal income tax purposes.
completed and attached to all Form IL-1065 filings.                         Pass-through entity income is the income that any partnership, 
You are required to attach any Schedule(s) K-1-P, Partner’s                 subchapter S corporation, or trust passes through to its partners, 
or Shareholder’s Share of Income, Deductions, Credits, and                  shareholders, or beneficiaries.
Recapture, and Schedule(s) K-1-T, Beneficiary’s Share of Income             PTE tax is an amount equal to 4.95% of the taxpayer’s calculated 
and Deductions, you receive. Attach Schedule(s) K-1-P and                   net income for the taxable year paid by a partnership (other than 
K-1-T you received which lists your name and FEIN in Step 2 of              a publicly traded partnership under Section 7704 of the Internal 
Schedule K-1-P or K-1-T. Do not attach copies of Schedule(s) K-1-P          Revenue Code) or subchapter S corporation who elects to pay the 
you issued and which lists your name and FEIN in Step 1 of                  tax for taxable years ending on or after December 31, 2021, and 
Schedule K-1-P.                                                             beginning prior to January 1, 2026.
       When filing your Form IL-1065, include only forms and                PTE tax credit is the distributive share of the credit allowed as a 
schedules required to support your return. Send correspondence              result of a partnership or S corporation having elected to pay the 
separately to:                                                              PTE tax.   
ILLINOIS DEPARTMENT OF REVENUE                                              PTE tax credit is
TAXPAYER CORRESPONDENCE                                                     •  reported to your partners on the Schedule K-1-P and
PO BOX 19044
SPRINGFIELD IL  62794-9044                                                  •  reported to IDOR on your Form IL-1065 and Illinois Schedule B.
Page 4 of 25                                                                                                          IL-1065 Instructions (R-12/22)

A nonresident individual partner of a partnership for a taxable year         What if I am a publicly-traded partnership?
in which the election to pay PTE tax was made shall not be required 
                                                                             A publicly-traded partnership is not required to withhold tax from its 
to file an income tax return under the IITA for such taxable year if 
                                                                             partners.  A publicly-traded partnership cannot elect to file and pay 
the only source of net income of the individual (or the individual 
                                                                             PTE tax. 
and the individual’s spouse in the case of a joint return) is from an 
entity making the PTE election and the credit allowed to the partner 
                                                                             What does taxable in other states mean?
equals or exceeds the individual’s liability for the tax imposed under     
subsections (a) and (b) of Section 201 of the IITA for the taxable year.     Taxable in other states means you are subject to and actually pay 
                                                                             “tax” in another state. “Tax” means net income tax, franchise tax 
Pass-through withholding is the amount required to be reported               measured by net income, or franchise tax for the privilege of doing 
and paid by the pass-through entity, who does not elect to pay               business. You are considered taxable in another state if that state 
PTE tax, on behalf of its nonresident partners, shareholders, and            has jurisdiction to subject you to a net income tax even though that 
beneficiaries                                                                state does not impose such a tax. This definition is for purposes of 
•  who have not submitted Form IL-1000-E, Certificate of Exemption           allocating nonbusiness income and apportioning business income 
for Pass-through Withholding, to the pass-through entity, and                inside or outside Illinois.
•  who receive business and nonbusiness income from the 
pass-through entity.                                                         When must I use Illinois Schedules K-1-P, 
Pass-through withholding is                                                  K-1-P(3), and B?
•  reported to your partners on the Schedule K-1-P you send to               You must use Illinois Schedule K-1-P to supply each partner with 
them,                                                                        that individual’s or entity’s share of the amounts reported on your 
•  reported to IDOR on your Form IL-1065 and Illinois Schedule B,            federal and Illinois tax returns. For Illinois Income Tax purposes, you 
and                                                                          must give a completed Illinois Schedule K-1-P and a copy of the 
                                                                             Illinois Schedule K-1-P(2), Partner’s and Shareholder’s Instructions, 
•  paid with your return or voluntarily prepaid with Form IL-1065-V.         to each partner. Do not file copies of Illinois Schedule K-1-P 
     If any of your partners are pass-through entities themselves,           that you issue to your partners with your Form IL-1065. 
they are required to report and pay pass-through withholding                 However, you must keep a copy of each Illinois Schedule K-1-P with 
on behalf of their own nonresident partners, shareholders, or                your tax records. See Illinois Schedule K-1-P(1), Instructions for 
beneficiaries on the income you passed through. Your partners may            Partnerships and S Corporations Completing Schedule K-1-P and 
claim a credit on their Illinois Income Tax return for pass-through          Schedule K-1-P(3), for more information.
withholding you reported and paid on their behalf.                           You must use IllinoisSchedule K-1-P(3), Pass-through Withholding 
Partnerships can both make and receive pass-through withholding.             Calculation for Nonresident Members, to calculate the required tax 
•  Pass-through withholding you owe on behalf of your                        you must report and pay on behalf of your nonresident partners who 
members is a payment of pass-through withholding you make on                 receive business or nonbusiness income from your partnership. You must 
behalf of your nonresident partners who have not submitted Form              complete the schedule if you have business or nonbusiness income 
IL-1000-E to you. This amount will be reported on Form IL-1065,              distributable to Illinois nonresident partners who have not provided 
Line 59.                                                                     you with Form IL-1000-E, Certificate of Exemption for Pass-through 
                                                                             Withholding. You are required to complete Schedule K-1-P(3) for each 
•  Pass-through withholding reported to you is a credit for 
                                                                             such partner and keep a copy of the completed schedule in your files. 
pass-through withholding you receive on Schedules K-1-P and 
                                                                             Do not submit Schedule K-1-P(3) to IDOR unless we request it 
K-1-T as a partner, shareholder, or beneficiary of a pass-through 
                                                                             from you. The information entered on this schedule will assist you 
entity. This amount will be reported on Form IL-1065, Line 65c.
                                                                             in completing Illinois Schedule B. See Schedule K-1-P(1) for more 
If you are a nonresident and the pass-through withholding reported to        information.
you satisfies your Illinois Income Tax liability, you are not required to 
                                                                             You must use Illinois Schedule B to supply us with a listing of your 
file an Illinois Income Tax return. If you had Illinois income from other 
                                                                             partners, certain items of income and credits they received from you, 
sources and the pass-through withholding made on your behalf does 
                                                                             and pass-through withholding you made on their behalf. You must 
not cover your liability, you must file a return to report the tax on all of 
                                                                             complete all lines of Illinois Schedule B, as applicable, and file it with 
your Illinois income and claim a credit for pass-through withholding 
                                                                             your Form IL-1065.
made on your behalf. 
All residents and pass-through entities must file their own annual           What if I am a member of a unitary group?
Illinois Income Tax return and claim a credit for any pass-through           Partnerships may not join in the filing of a combined return. However, 
withholding reported to them.                                                you may be required to file a separate unitary return, and file a 
                                                                             Schedule UB, Combined Apportionment for Unitary Business Group, 
What if I am an investment partnership?                                      to apportion your business income. 
Effective for tax years ending on or after December 31, 2004, 
                                                                             If the following applies, do not file a Schedule UB: If a partnership 
any partnership that qualifies as an “investment partnership” as 
                                                                             is engaged in a unitary business with one or more of its partners, 
defined in the IITA, Section 1501(a)(11.5), shall not be subject to 
                                                                             but the unitary partners do not own substantially all of the interest 
replacement tax, is not required to withhold tax from its partners, and 
                                                                             in the partnership, the partnership should not be included on a 
is not required to file Form IL-1065. However, you may elect to file 
                                                                             Schedule UB with the partners. Substantial ownership is defined as 
Form IL-1065 even if you are an investment partnership. If you elect 
                                                                             owning more than 90 percent of all the interest in the partnership. 
to file Form IL-1065, you must check the appropriate box on Line F, 
                                                                             If a Schedule UB should not be filed, each unitary partner must 
and complete the return with the appropriate figures. Check the box 
                                                                             determine the portion of its business income taxed by Illinois 
on Line 35 B, enter zero on Step 6, Lines 36 through 46 and Step 7, 
                                                                             by adding its share of that partnership’s business income and 
Line 47.
                                                                             apportionment factors (Illinois and everywhere) to its own business 
                                                                             income and apportionment factors (Illinois and everywhere). This rule 
                                                                             applies to you if you are unitary with one or more of your partners 

IL-1065 Instructions (R-12/22)                                                                                                     Page 5 of 25

or if you are a partner in another partnership and are engaged in a      partnerships included on the Schedule UB, and S corporations 
unitary business with that partnership. See 86 Ill. Adm. Code Section    minus the portion of those amounts allocable to partners subject to 
100.3380(d), for more information.                                       replacement tax.
If the following applies, you must file a Schedule UB: If you            Schedules used to compute any amounts shown must be attached 
are a partnership who is a shareholder in a corporation and are          to Form IL-1065.
engaged in a unitary business with that corporation, or if you are       If you need more information, visit our web site at tax.illinois.gov and 
owned more than 90 percent by members of your unitary business           view the Illinois Income Tax regulations referenced in these instructions 
group (determined without regard to the rule prohibiting taxpayers       and in the Schedule UB instructions.
who use different apportionment formulas from being included in a 
unitary business group and the rule prohibiting taxpayers conducting     What if I participated in a reportable transaction?
80 percent or more of their business activities outside the United 
                                                                         If you participated in a reportable transaction, including a “listed 
States from being included in a unitary business group), and you:
                                                                         transaction,” during this tax year and were required to disclose that 
•  use the same taxable year as a combined group that includes           transaction to the IRS, you are also required to disclose that information 
   your partners or your subsidiary, you should use the Schedule UB      to Illinois.
   prepared by the combined group in completing your Form IL-1065; 
                                                                         You must send us two copies of the form you used to disclose the 
•  use a different taxable year from the combined group that             transaction to the IRS.
   includes your partners or your subsidiary, or there is no 
                                                                         •  Mail the first copy of the federal disclosure statement to:
   combined group, you must complete your own Schedule UB 
   using your own taxable year.                                            ILLINOIS DEPARTMENT OF REVENUE 
                                                                           PO BOX 19029
If you are required to file a Schedule UB: Use the line reference chart     SPRINGFIELD IL  62794-9029
in the Schedule UB instructions to help complete your Form IL-1065. 
                                                                         •  Attach the second copy to your Illinois Income Tax return for the 
Steps 2 and 3 of your Form IL-1065 must be completed showing only 
                                                                           tax year that the IRS disclosure was required. Mail the second 
your separate-company items. The amounts on your Form IL-1065, 
                                                                           copy and your Illinois Income Tax return to the address shown on 
lines 14 through 22 (less Lines 20 and 21) and Lines 24 through 33 
                                                                           your return. Do not mail the second copy and your Illinois Income 
(less Line 25, 26, and 27) shall be the combined totals shown on 
                                                                           Tax return to the address listed above.
Schedule UB, Step 3, Column E. 
Notes concerning specific Form IL-1065 income modifications:             What if I need additional assistance or forms?
•  The addition modification for guaranteed payments on Form              •  Visit our website at tax.illinois.gov for assistance, forms or 
   IL-1065, Line 20, should be zero. This addition modification for all    schedules.
   partnerships included on the Schedule UB is included in the “other    •  Write us at: 
   additions” on Schedule UB, Step 3, Column E, Line 8, and so             ILLINOIS DEPARTMENT OF REVENUE
   included in Line 22 of the Form IL-1065.                                PO BOX 19001
•  The subtraction modifications for August 1, 1969, valuation             SPRINGFIELD IL  62794-9001
   limitation amounts on Form IL-1065, Line 25, and personal             •  Call 1 800 732-8866 or 217 782-3336 (TDD, telecommunications 
   service income or reasonable allowance for compensation                 device for the deaf, at 1 800 544-5304). 
   of partners on Form IL-1065, Line 26, should be zero. These           •  Visit a taxpayer assistance office - 8:00 a.m. to 5:00 p.m. 
   subtraction modifications for all partnerships included on              (Springfield office) and 8:30 a.m. to 5:00 p.m. (all other offices), 
   the Schedule UB are included in the “other subtractions” on             Monday through Friday. 
   Schedule UB, Step 3, Column E, Line 21, and so included in 
   Line 33 of the Form IL-1065.
                                                                         Where should I file?
•  The modifications for Form IL-1065, Lines 21 and 27 are not           File electronically - 
   included as modifications on the Schedule UB. The amount 
   on your Form IL-1065, Lines 21 or 27, must be computed on             • Modernized e-File (MeF)
   the Illinois Schedule B, Column E Worksheet, found in these           • Third-party Tax-Prep Software
   instructions. Carry the combined total amounts from Schedule UB,      File on paper - 
   Step 3, Column E for each line item of the Column E Worksheet. 
                                                                         • If a payment is enclosed, mail your Form IL-1065 to:
Use the Line 21 and Line 27 amounts to compute your base income            ILLINOIS DEPARTMENT OF REVENUE
on Form IL-1065 Line 35. Check the box on Form IL-1065, Line 35 B,         PO BOX 19053
and complete Form IL-1065, Step 6 by subtracting:                          SPRINGFIELD IL  62794-9053
•  on Line 36, the combined nonbusiness income of the entire             • If a payment is not enclosed, mail your Form IL-1065 to: 
   unitary business group, minus the portion allocable to partners 
                                                                           ILLINOIS DEPARTMENT OF REVENUE 
   subject to replacement tax, and                                         PO BOX 19031
•  on Line 37, the amount received by the entire unitary business          SPRINGFIELD IL  62794-9031
   group from non-unitary partnerships, partnerships included on         If you are operating as a business organized under the Lloyd’s plan 
   the Schedule UB, S corporations, trusts, and estates, minus the       of operation, you should mail your Form IL-1065 to:
   portion allocable to partners subject to replacement tax. 
                                                                         ATTN: LLOYD’S OF LONDON
On Form IL-1065, Step 6, Line 40, include the everywhere sales           BUSINESS PROCESSING DIVISION
amount from Schedule UB, Step 4, Column D, Line 2. On Line 41 of         PO BOX 19014
Step 6 of Form IL-1065, include your Illinois sales. On Form IL-1065,    SPRINGFIELD IL  62794-9014
Step 6, Lines 44 and 45, include only your separate-company 
nonbusiness income, and the business income or loss apportionable 
to Illinois you received from trusts, estates, non-unitary partnerships, 

Page 6 of 25                                                                                                        IL-1065 Instructions (R-12/22)

                                                Specific Instructions
Specific instructions for most of the lines are provided on the             O — If you are making the election to treat all of your income other 
following pages. If a specific line is not referenced, follow the           than compensation as business income for this tax year, you must 
instructions on the form.                                                   check the box on this line and enter zero on Step 6, Lines 36 and 
                                                                            44. This election must be made by the extended due date of this 
Step 1 — Identify your partnership                                          return. Once made, the election is irrevocable. 
A — All taxpayers: Type or print your legal business name. If you           P — If you are required to disclose reportable transactions and you 
have a name change from last year, check the corresponding box.             have completed U.S. Form 8886 or U.S. Schedule M-3, Part II, Line 
B — Type or print your mailing address. If your address has changed         10, check the appropriate box and attach a copy of the federal form 
since you filed your last return or if this is your first return, check the or schedule to this return. See “What if I participated in a reportable 
box.                                                                        transaction?” for more information.
         If you checked the box in Line B because you have never            Q — If you are claiming a special depreciation addition or 
filed an Illinois return, you must also check the “first return” box in     subtraction modifications on Form IL-1065, check the box and attach 
Line C.                                                                     Form IL-4562, Special Depreciation, to your tax return.
C — If this is your first or final return, check the appropriate box and    R — If you are claiming other addition or subtraction modifications on 
the box on Line 68 if you have a credit carryforward on your final          Form IL-1065, check the box and attach Schedule M, Other Additions 
return.                                                                     and Subtractions (for businesses), to your tax return.
D — If you checked final return on Line C, answer the questions on          S — If you are claiming related-party expenses modifications on 
Line D, if applicable.                                                      your Form IL-1065, check the box and attach Schedule 80/20, 
                                                                            Related-Party Expenses, to your tax return.
E — Apportionment Formulas - If you earn income both inside and 
outside of Illinois, check the appropriate box(es). If you are a unitary    T — Check the box if you are claiming deductions or credits listed 
business group, check as many boxes as applicable. If more than             on Illinois Schedule 1299-A, Tax Subtractions and Credits. You must 
one box is checked, you must complete a Subgroup Schedule for               check the box and attach Illinois Schedule 1299-A and any other 
each checked box that is not a sales company. If you earn income            required support listed on Schedule 1299-A to your tax return to 
only inside Illinois, leave this line blank. For more information, see      support any deductions or credits you are claiming or passing to your 
the specific instructions for “Apportionment Formulas.”                     partners.
F — Check the appropriate box if:                                           U — Check this box only if you have sales into Illinois and you are 
                                                                            not required to allocate them because you are protected by Public 
•   you are an investment partnership. See “What if I am an                 Law 86-272. Complete Steps 1 through 7 of the IL-1065. 
    investment partnership?” under General Information for more 
    information; or                                                         V — If you are attaching Subgroup Schedule to your Schedule 
                                                                            UB, check the box. See Subgroup Schedule and Schedule UB 
•   you are a publicly-traded partnership. See “What if I am a              instructions for more information.
    publicly-traded partnership?” under General Information for more 
    information.                                                                  You must complete an IDOR-issued or previously 
                                                                            approved Form IL-1065 and corresponding schedules. Do not 
G — Check the box if you are making the election to not be treated          send a computer printout or spreadsheets with line numbers and 
as a partnership under IRC Section 761.                                     dollar amounts attached to a blank copy of the return. 
H — Check this box if you are a 52/53-week filer. A 52/53-week              If you are operating a business organized under a Lloyd’s plan of 
filer is a fiscal filer with a tax year that varies from 52 to 53 weeks     operation, you must refer to 86 Ill. Adm. Code Section 100.5130, for 
because their tax year ends on the same day of the week instead of          specific instructions on how to properly complete Form IL-1065.
the last day of the month.  
I — Check this box if you elect to file and pay PTE tax in an amount        Step 2 — Figure your ordinary income or loss
equal to 4.95% of the taxpayer’s calculated net income for the 
taxable year on Line 61.                                                    Lines 1 through 5 — Enter the amount for each line item 
                                                                            from the corresponding line(s) on your U.S. Form 1065 or 1065-B, 
J — Check this box if you are paying Pass-through Entity (PTE) Tax          Schedule K. Attach a copy of your federal return. See the chart below 
and you annualized your income on Form IL-2220, Computation of              to determine the correct corresponding lines.
Penalties for Businesses. Attach Form IL-2220.
                                                                                               U.S. Form 1065,           U.S. Form 1065-B, 
K — Enter your entire federal employer identification number (FEIN).        Form IL-1065
A partial FEIN will delay processing of your return.                                                 Schedule K             Schedule K
L — If you are a member of a unitary business group and are                      Line 1              Line 1              Lines 1b(1), 1d
included on a Schedule UB, Combined Apportionment for Unitary                    Line 2              Line 2                 Line 1b(2)
Business Group, check the box. Enter the entire FEIN of the member 
                                                                                 Line 3              Line 3c                Line 1b(3)
who prepared the Illinois Schedule UB and attach the Schedule UB 
to this return.                                                                  Line 4        Lines 5, 6a, 7, 8, 9a     Not applicable
M — Enter your North American Industry Classification System                     Line 5              Line 10             Not applicable
(NAICS) Code. If you are unsure of your code, you can research the                 Under federal law, Paycheck Protection Program (PPP) 
information at www.census.gov/naics or www.irs.gov.                         loan forgiveness is not considered taxable income and the business 
N — If you keep your accounting records in a location different from        expenses covered by the PPP loan proceeds are deductible 
the address indicated on Line B, enter the city, the two-letter state       business expenses. Currently, Illinois tax law has no addition 
abbreviation, and the Zip Code for the location the records are kept.       modification to change this; therefore, the same treatment flows 
                                                                            through to the Illinois return and is included as part of federal taxable 
                                                                            income. 
IL-1065 Instructions (R-12/22)                                                                                                         Page 7 of 25

Line 6 — Include any items of income or loss from U.S. Form 1065          Some interest and intangible expenses may be exempt from this 
or 1065-B, Schedule K, that are not included on any other line of         add-back provision. See Illinois Schedule 80/20 Instructions for more 
Step 2 or Step 3 of this Form IL-1065.                                    information including definitions of “affiliated company,” “intangible 
                                                                          expenses,” and “intangible assets.”
Step 3 — Figure your unmodified base income                               Line 19 — If you are a partner in a partnership, a shareholder 
or loss                                                                   in a subchapter S corporation, or a beneficiary of a trust or an 
Lines 8 through 10 — Enter the amount for each line item                  estate, include your distributive share of additions received from the 
from the corresponding line on your U.S. Form 1065 or 1065-B,             partnership, S corporation, trust or estate on Schedules K-1-P or 
Schedule K. See the chart below to determine the correct                  K-1-T. If you receive multiple schedules because you are a recipient 
corresponding lines.                                                      from multiple entities, you should enter the combined total of Step 
                                                                          5, Column A, Lines 32 through 37, from all Illinois Schedules K-1-P 
                     U.S. Form 1065,      U.S. Form 1065-B, 
Form IL-1065                                                              you receive and Step 5, Column A, Lines 30 through 35, from all 
                     Schedule K                     Schedule K            Illinois Schedules K-1-T you receive. Attach a copy of all Illinois 
      Line 8             Line 13a                   Not applicable        Schedules K-1-P and K-1-T you received to your form IL-1065.
      Line 9             Line 12                    Not applicable         The S corporation or the partnership is required to send 
                                                                          you an Illinois Schedule K-1-P and the trust or the estate is required 
Line 10                  Line 13b                   Not applicable        to send you an Illinois Schedule K-1-T, specifically identifying your 
Line 11 — Include any items of expense                                    share of income.
•  that you are required to state separately to your partners, rather                   Include only additions reported to you on the 
than include in ordinary income, and                                      Schedule(s) K-1-P or K-1-T you received from a pass-through entity 
•  that would be taken into account by an individual in computing his     in which you are an investing partner or shareholder or a beneficiary. 
or her taxable income, and                                                Do not attach copies of Schedules K-1-P you issued to your 
                                                                          partners. You should keep copies of these schedules in your records. 
•  that are not included on any other line of Step 2 or Step 3 of this 
Form IL-1065.                                                             Line 20 — Enter the guaranteed payments to partners from 
                                                                          U.S. Form 1065, Schedule K, Line 4, or U.S. Form 1065-B, 
Do not include any of the following items on this line:                   Schedule K, Line 7, excluding the amounts you capitalized. 
•  net operating loss carryovers;                                         Line 21 — Complete Illinois Schedule B. Illinois Schedule B, 
•  any qualified business income deduction allowed under                  Section A, Line 3 represents the share of distributable income or 
IRC Section 199A;                                                         loss that is to be added to or subtracted from base income. If the 
•  any depletion amounts allowed federally on all of your oil and gas     total amount on Illinois Schedule B, Section A, Line 3 is a negative 
properties; and                                                           amount (loss), it should be entered on Line 21 as a positive amount. 
                                                                          See the “Illinois Schedule B Instructions” following these “Specific 
•  any excess business interest expense under IRC Section 163(j).
                                                                          Instructions” for more information. Attach Illinois Schedule B to 
Line 13 — This is your total unmodified base income or loss. If           your Form IL-1065. 
you are a member of a unitary group see “What if I am a member 
of a unitary group?” in the General Instructions for what to enter on     Line 22 — Enter the addition amount calculated on Illinois 
                                                                          Schedule M, Step 2, Line 11. Attach a copy of Illinois Schedule 
Line 13. 
                                                                          M to your Form IL-1065. The following are examples of items 
Step 4 — Figure your income or loss                                       that must be added to taxable income and are included on Illinois 
                                                                          Schedule M.
Line 14 — Follow the instructions on the form. If you are a member 
of a unitary group see “What if I am a member of a unitary group?” in     •  Notes, bonds, debentures, or obligations issued by the 
the General Instructions for what to enter on Line 14.                    Governments of Guam, American Samoa, Puerto Rico, the 
                                                                          Northern Mariana Islands, or the Virgin Islands.
       Do not enter negative amounts on Lines 15 through 22. 
                                                                          •  Lloyd’s plan of operations loss if reported on your behalf on Form 
Line 15 — Enter the total of all amounts excluded from unmodified         IL-1065, Partnership Replacement Tax Return, and included in 
base income that were received or accrued as federally tax-exempt         your taxable income.
interest (e.g. state, municipal and other interest) and all distributions 
of exempt interest received from regulated investment companies           •  Deductions you claimed this year and in your two most 
during the tax year.                                                      recent tax years for expenses connected with income from 
                                                                          an asset or activity which were reported as business income 
Line 16 — You must add back any amount of Illinois Replacement            in prior years and as nonbusiness income on this return. See 
taxes that you deducted on your U.S. Form 1065 or 1065-B to arrive        Illinois Schedule NB, Nonbusiness Income, Line 11, and Illinois 
at your federal ordinary income. You are not required to add back         Schedule NB Instructions for more information.
taxes from other states that you included as a federal deduction.
A partnership that elects to pay PTE tax must add back the amount         Step 5 — Figure your base income or loss
of that tax deducted federally, in addition to the add back for           Do not enter negative amounts on Lines 24 through 34. 
replacement tax deducted.
                                                                           A double deduction is prohibited by IITA, Section 203(g). 
Line 17 — Enter the addition amount calculated on Form IL-4562,           You cannot deduct the same item more than once.
Step 2, Line 4. For more information, see Form IL-4562 Instructions. 
Attach Form IL-4562 to your Form IL-1065.                                 Line 24 — Enter the total interest received or accrued from U.S. 
                                                                          Treasury bonds, notes, bills, federal agency obligations, and savings 
Line 18 — Enter the interest or intangible expenses, or insurance         bonds included in federal ordinary income. You may not subtract 
premiums paid to an affiliated company, to the extent these               anything that is not identified in Illinois Publication 101  . This amount 
expenses exceed any taxable dividends you received from the               is net of any bond premium amortization deducted federally.
affiliated company. To compute the amount of this addition, 
complete Step 2 of Illinois Schedule 80/20 and enter on Line 18 the 
total from Illinois Schedule 80/20, Step 2, Line 9. Attach Illinois 
Schedule 80/20 to your Form IL-1065.
Page 8 of 25                                                                                                      IL-1065 Instructions (R-12/22)

Line 25 — Enter the amount from Illinois Schedule F (Form IL-1065),                    Include only subtractions reported to you on the 
Gains from Sales or Exchanges of Property Acquired Before August          Schedule(s) K-1-P or K-1-T you received from a pass-through entity 
1, 1969, Line 14. Capital gain, or Section 1245 or 1250 gain, on          in which you are an investing partner, shareholder, or beneficiary. Do 
property acquired before August 1, 1969, may be limited by the            not attach copies of Schedules K-1-P you issued to your partners. 
value of the property on August 1, 1969. See Illinois Schedule F          You should keep copies of these schedules in your records.
(Form IL-1065) Instructions for more information. Attach Illinois         Line 33 — Enter the subtraction amount calculated on Illinois 
Schedule F and a copy of U.S. Schedule D (or U.S. Form 8949),             Schedule M, Step 3, Line 36. Attach a copy of Illinois Schedule M 
U.S. Form 4797, and U.S. Form 6252, if filed.                             to your Form IL-1065.
Line 26 — Enter the greater of                                            You may not subtract anything that is not identified below, 
• your personal service income as defined in the now-repealed             on Schedule M (for businesses), or in Illinois Publication 101. 
  IRC Section 1348(b)(1); or                                              Subtractions allowed on Illinois Schedule M include:
• a reasonable allowance for compensation paid or accrued for             •  notes, bonds, debentures, or obligations issued by the 
  services rendered by partners to you.                                      Governments of Guam, American Samoa, Puerto Rico, the 
See 86 Ill. Adm. Code Section 100.2850 for more information.                 Northern Mariana Islands, or the Virgin Islands, to the extent that 
                                                                             you were required to add these amounts to your federal ordinary 
Line 27 — Complete Illinois Schedule B. Illinois Schedule B, 
                                                                             income.
Section A, Line 3 represents the share of distributable income or 
loss that is to be added to or subtracted from base income. If the        •  the refund of Illinois replacement tax for a prior year, to the extent 
total amount on Illinois Schedule B, Section A, Line 3 is a positive         included in your federal ordinary income.
amount, enter that amount on Line 27. If the total amount on Illinois     •  any other income included on Step 4, Line 23, exempt from 
Schedule B, Section A, Line 3 is negative, leave Line 27 blank and           taxation by Illinois by reason of its Constitution or statutes or 
see the instructions for Line 21. For more information, see the “Illinois    by the Constitution, treaties, or statutes of the United States. 
Schedule B Instructions” following these “Specific Instructions”.            This amount is net of any bond premium amortization deducted 
Attach Illinois Schedule B to your Form IL-1065.                             federally. For more information, see Illinois Publication 101.
Line 28 — Enter the River Edge Redevelopment Zone Dividend                •  the amount equal to the deduction used to compute the federal 
subtraction from Illinois Schedule 1299-A, Step 1, Line 3.                   tax credit for restoration of amounts held under claim of right 
Line 29 — Enter the High Impact Business Dividend subtraction                under IRC Section 1341.
from Illinois Schedule 1299-A, Step 1, Line 6.                            •  contributions you made under the Tax Increment Allocation 
        You must attach Illinois Schedule 1299-A, Tax                        Redevelopment Act to a job training project. For more information, 
Subtractions and Credits, and any other required support listed              see FY Bulletin 1990-40.
on Schedule 1299-A to your Form IL-1065 if you have an amount             Line 35 — This is your base income or loss. 
on Line 28 or Line 29.                                                    Follow the instructions on the form and check a box on Line A or B. 
Line 30 — Enter the subtraction allowance from Form IL-4562,              You must check one of these boxes and follow the instructions for 
Step 3, Line 13. Attach Form IL-4562 to your Form IL-1065.                that line.
Line 31 — Enter the amount from Illinois Schedule 80/20, Step 4,          Check the box on Line A if
Line 23. Attach Illinois Schedule 80/20 to your Form IL-1065.             •  all of your base income or loss is derived inside Illinois; and
You should use Illinois Schedule 80/20 if                                 •  you do not have any income or loss to report on Lines 36, 37, 44, 
•   you added back interest paid to an affiliated company on Step 4,         or 45.
  Line 18. You may subtract any interest received from that               If you check the box on Line A, do not complete Step 6. All of 
  company during this tax year, up to the amount of your addition         your base income or loss is allocable to Illinois. Skip Step 6, enter the 
  for interest expense paid to that company. Also, if you added back      amount from Step 5, Line 35 on Step 7, Line 47, and complete the 
  intangible expenses from a transaction with an affiliated company       remainder of the return.
  on Line 18, you may subtract any income you received during 
  the tax year from similar transactions with the affiliated company,     Check the box on Line B if any of the following apply
  up to the amount of your addition for intangible expense for that       •  your base income or loss is derived inside and outside Illinois; 
  company. To compute the amount of this subtraction, complete            •  all of your base income or loss is derived outside Illinois; or
  Illinois Schedule 80/20.                                                •  you have income or loss to report on Lines 36, 37, 44, or 45.
•  you are an affiliated company, and you received interest               If you check the box on Line B, you must complete all lines 
  or intangible income from someone who had to add back the               of Step 6. Submitting Form IL-1065 with an incomplete Step 6, 
  interest and intangible expense, or insurance premiums on               including Lines 40, 41, and 42 may result in a delay in processing 
  their Illinois Schedule 80/20. You may subtract your interest or        your return, further correspondence, and you may be required to 
  intangible income from that person.                                     submit further information to support your filing. See the Specific 
Line 32 — Enter your distributive share of subtractions passed            Instructions for Step 6 for more information.
through to you by a partnership, trust, or estate on Schedules K-1-P 
or K-1-T. Do not include any amounts passed through that are              Step 6 — Figure your income allocable to 
reflected on Illinois Schedule 1299-A. Attach a copy of all Illinois      Illinois
Schedules K-1-P and K-1-T you received to your Form IL-1065.              You must check the box on Line B and complete all lines of Step 
        The partnership or S corporation is required to send you an       6 if any portion of Line 35, base income or loss, is derived outside 
Illinois Schedule K-1-P and the trust or the estate is required to send   Illinois, or you have any income or loss to report on Lines 36, 37, 44, 
you an Illinois Schedule K-1-T, specifically identifying your share of    or 45. 
subtractions.                                                             If you do not complete all of Step 6, Lines 36 through 46, we may 
                                                                          issue a notice and demand proposing 100 percent of income as 
                                                                          being allocated to Illinois, or in the case of a loss return, a notice 

IL-1065 Instructions (R-12/22)                                                                                                        Page 9 of 25

indicating none of your loss as being allocated to Illinois.             Section 100.3380(d).
In order to properly allocate your base income or loss you need to       Line 40 — Enter your total sales everywhere. 
determine what portion of the total base income is business income       Line 41 — Enter your total sales inside Illinois. If you have no sales 
or loss that is to be apportioned among all the states in which you do   in Illinois, enter zero. 
business, and what portion is nonbusiness income or loss that is to 
be allocated to a particular state.                                         Lines 40 and 41 cannot be less than zero. The amount on 
                                                                         Line 41 cannot exceed the amount on Line 40.
 Unitary filers who are required to file a Schedule UB - 
You must complete both Step 4 of the Schedule UB and Step 6 of           Line 42 — Divide Line 41 by Line 40 and enter the result, rounded 
the Form IL-1065.                                                        to six decimal places. The result cannot be greater than one or less 
                                                                         than zero.
 Investment partnerships that elect to complete Form IL-1065 
should check the box on Line 35 B, enter zero on Step 6, Lines 36           If you checked the box on Line 35 B and do not complete 
through 46 and Step 7, Line 47, and check the corresponding box in       Lines 40, 41, and 42 we may issue a notice and demand proposing 
Step 1, Line F.                                                          100 percent of your income as being allocated to Illinois, or in the 
                                                                         case of a loss return, a notice indicating none of your loss as being 
                 Line by Line Instructions                               allocated to Illinois.
 You must complete all lines of Step 6.                                  Line 43 — Follow the instructions on the form.
Line 36 — Enter the amount of all nonbusiness income or loss             Line 44 — Enter the amount of nonbusiness income or loss 
included in base income, net of any related deductions, plus             allocable to Illinois from Illinois Schedule NB, Column B. Include any 
any recaptured business expenses from Illinois Schedule NB,              nonbusiness income you received from Illinois Schedules K-1-P or 
Column A. Include any nonbusiness income you received from Illinois      K-1-T in the amounts reported on Schedule NB. This amount is net 
Schedules K-1-P or K-1-T in the amounts reported on Schedule NB.         of the portion of your Illinois nonbusiness income distributable to 
Attach Illinois Schedule NB and all Illinois Schedules K-1-P or          partners subject to replacement tax. Attach a copy of Schedule NB 
K-1-T you received to your Form IL-1065. If you do not have an           and all Illinois Schedules K-1-P and K-1-T you received to your 
amount to report on this line, enter zero.                               Form IL-1065. If you do not have an amount to report on this line, 
 If you are making the election to treat all income other than           enter zero.
compensation as business income for this tax year, you must check           If you checked the box in Step 1, Line O, making the election 
the box in Step 1, Line O, and enter zero here and on Line 44. This      to treat all of your income other than compensation as business 
election must be made by the extended due date of this return.           income, then enter zero on Line 44. 
Once made, the election is irrevocable.                                  Line 45 — Enter the amount of the income or loss reported on 
Line 37 — Enter the amount of all business income or loss                Step 6, Line 37 that is apportionable to Illinois as reported by the 
included in base income received from any non-unitary partnership,       non-unitary partnership, partnership included on a Schedule UB, 
partnership included on a Schedule UB, S corporation, trust, or          S corporation, trust, or estate, on Illinois Schedules K-1-P or K-1-T, 
estate, of which you are a partner, or a beneficiary, net of any         net of the portion distributable to partners subject to replacement 
amount distributable to partners subject to replacement tax. See         tax. See Illinois Schedules K-1-P(2) or K-1-T(2) for more information. 
Illinois Schedules K-1-P(2) or K-1-T(2) for more information. Attach     Attach a copy of all Illinois Schedules K-1-P and K-1-T you 
a copy of all Illinois Schedules K-1-P and K-1-T you received to         received to your Form IL-1065. If you do not have an amount to 
your Form IL-1065. If you do not have an amount to report on this        report on this line, enter zero.
line, enter zero.
 The partnership or S Corporation is required to send you                Step 7 — Figure your net income
an Illinois Schedule K-1-P and Schedule K-1-P(2) and the trust or        Line 47 — Follow the instructions on the form. If this amount is a 
the estate is required to send you an Illinois Schedule K-1-T and        loss, you may carry it forward to later years as an Illinois net loss 
Schedule K-1-T(2), specifically identifying your share of income.        deduction (NLD). 
               If you are a partner engaged in a unitary business 
with your partnership, you must either file a Schedule UB with that      Line 48 — Enter your Illinois net loss deduction carryforward 
partnership or include your distributable share of the partnership’s     as determined on Illinois Schedule NLD, Step 1, Line 7, total box. 
business income in your business income. Do not subtract this            Attach Illinois Schedule NLD to your Form IL-1065. 
business income on Line 37.                                              If you are a cooperative and you separate your patronage and 
Lines 40 through 42 —                                                    nonpatronage income or loss, complete Schedule INL and follow the 
                                                                         instructions for computation of your Illinois net loss deduction.
You must complete Lines 40 through 42 if any of the following apply
                                                                         If any of the loss being claimed on Line 48, originated from a 
•   your business income or loss is derived inside and outside Illinois; 
                                                                         company other than the one filing this return, check the box on 
•   all of your business income or loss is derived outside Illinois; or  Line 48 and attach a detailed statement to your return with
•   you have income or loss to report on Lines 36, 37, 44, or 45.        • the FEIN of the company from which you acquired the loss, 
Follow specific instructions below for Lines 40 through 42.              • the reason (e.g., merger) you are allowed to use that company’s 
 If you are a financial organization, a transportation                     losses, and 
company, sales company, or a federally regulated exchange,               • the date you acquired the loss.
check the appropriate box in Step 1, Line E (financial organization, 
                                                                            For more information, see the Schedule NLD Instructions.  
transportation company, sales company, or federally regulated 
exchange) and see “Apportionment Formulas” in these instructions.        Line 51 — Divide Line 47 by Line 50 and enter the result, rounded 
               If you are a partner engaged in a unitary business        to six decimal places. This figure cannot be greater than one.
with your partnership, you must either file a Schedule UB with that      Line 52 — The standard exemption is $1,000 multiplied by a 
partnership or include your distributive share of the “everywhere” and   fraction in which the numerator is your base income allocable to 
“Illinois” sales factors from the partnership in your “everywhere” and   Illinois and the denominator is your total base income. This figure 
“Illinois” sales factors. For more information, see 86 Ill. Adm. Code    cannot be greater than “$1,000.” The standard exemption is $0.00 if 
                                                                         your unmodified base income amount on Step 3, Line 13 is $250,000 
Page 10 of 25                                                                                                 IL-1065 Instructions (R-12/22)

or more.                                                                  completed Form IL-2220 to your Form IL-1065.
If you have a change in your tax year end, and the result is a tax           If you do not need to annualize your income and do not
period of less than 12 months, the standard exemption is prorated         wish to complete Form IL-2220, we encourage you to let us figure
based on the number of days in the short tax year. However, if this is    your penalties and interest and send you a bill instead of determining
your first or final return, you are allowed to use the full-year standard these amounts yourself. We will compute any penalty or interest due
exemption even if it is a short tax year.                                 and notify you.  
Line 53 — If Line 49 is a loss, enter the amount from Line 49 on 53.      Step 9 — Figure your refund or balance due
Do not increase your loss by the exemption allowance on Line 52.             Do not include any PTE tax or PTE tax credit on 
                                                                          Lines 65a through 65d. PTE tax is reported on Line 61 and PTE Tax 
Step 8 — Figure the taxes, pass-through                                   credit is reported for each member on Schedule B, Section B, Line L. 
withholding, and penalty you owe
                                                                          Line 65a — Enter the sum of any overpayment to be applied to this 
Line 55 — Enter your recapture of investment credits from Illinois        year’s tax return. Take into account any correspondence we may 
Schedule 4255, Recapture of Investment Tax Credits, Step 5,               have sent you that changed the amount of your credit carryforward 
Column D, Line 20.                                                        from the previous year.
If you claimed an Illinois investment tax credit in a prior year on       Line 65b — Enter the sum of any
Form IL-477, Replacement Tax Investment Credits, and any of 
the property was disqualified within 48 months of being placed in         • estimated payments or tax prepayments made before the date 
service, you must use Illinois Schedule 4255 to compute the amount          this return is filed,
of recapture. Credit must be recaptured in the year the property          • extension payments before the date this return is filed, and
became disqualified.                                                      • any other payments made before the date this return is filed. 
Line 57 — Enter the amount from Form IL-477, Step 1, Line 13.             Line 65c — Enter the amount you wish to claim of Illinois 
Attach Form IL-477 and any other required support listed on               pass-through withholding reported to you by partnerships, 
Form IL-477 to your Form IL-1065.                                         S corporations, or trusts on Schedule(s) K-1-P or K-1-T. If you 
You may claim a replacement tax investment credit of .5 percent           received more than one Schedule K-1-P or K-1-T, add the amounts 
(.005) of the basis of qualified property placed in service in Illinois   you wish to claim from all the schedules and enter the total on 
during the tax year.                                                      Line 65c. Attach copies of the Schedules K-1-P and K-1-T you 
An additional credit of up to .5 percent (.005) of the basis of qualified received from the pass-through entities to your Form IL-1065. 
property is available if your Illinois base employment increased by       Schedules K-1-P and K-1-T, Step 1, Line 3, must be completed 
1 percent (.01) or more over the preceding year or if your business       or the pass-through withholding reported on this line may not be 
is new to Illinois. Excess credit may be carried forward for five         credited to your return. 
years following the excess credit year. For more information, see         See “Definitions to help you complete your Form IL-1065” in these 
Form IL-477 Instructions.                                                 instructions for more information.
Line 59 — Complete all sections of Illinois Schedule B and enter             Do not include on Line 65c any pass-through withholding 
the amount from Illinois Schedule B, Section A, Line 5 on this line.      you owe on behalf of your members. Pass-through withholding you 
This is the amount of pass-through withholding you owe on behalf of       owe on behalf of your members is included on Step 8, Line 59.
your members. Attach Illinois Schedule B to your Form IL-1065.            Line 65d — Enter the amount of Illinois income tax withheld on 
See “Definitions to help you complete your Form IL-1065” in these         Forms W-2G from gambling and sports wagering winnings that were 
instructions for more information. If you complete Line 59, then          received by you.
Line 61 should be blank. 
                                                                          Line 68 — Enter the amount of overpayment you elect to be carried 
 Do not include any amount from Schedule B, Section B,                    forward to your next tax year. Check the box on this line if this is 
Line K, PTE tax credit paid to members, or Line L, PTE tax credit         your final return and any remaining carryforward is being transferred 
received and distributed to members.                                      to another entity. Attach a detailed statement to your return listing 
 Do not include on Line 59 any pass-through withholding                   the FEIN of the entity receiving the credit carryforward, the date the 
reported to you on Schedule(s) K-1-P or K-1-T. Pass-through               credit was transferred, and the reason for the transfer. 
withholding amounts reported to you are included on Step 9,                  Step 1, Line C, must also be completed if you are 
Line 65c.                                                                 transferring an overpayment to another entity. 
Line 60 —  Complete this line if you elect to file and pay PTE tax        Your credit carryforward will not be applied if you do not file a 
on your calculated base income. The total amount of PTE credit            processable return.
allocated to partners cannot exceed the PTE liability reported and 
actually paid by the partnership. Follow the instructions on the PTE         Your credit carryforward may be reduced by us due to 
Income Worksheet on Page 12 to determine the amount to enter on           corrections we make to your return, or to satisfy any unpaid tax, 
this line.                                                                penalty, and interest due for this year or any other year. If we reduce 
                                                                          your credit carryforward, it may result in a late-payment penalty in a 
Line 61 — Follow the instructions on the form. Do not include any         subsequent year.
PTE tax credit you received on Schedule(s) K-1-P or K-1-T on 
this line.                                                                To which tax year will my credit apply?
 If you complete Line 61, then Line 59 should be blank.                   If your 2022 return was filed
Line 63 — If you elected to pay PTE tax and your total tax liability is   ‰  on or before the original filing and payment due date of your 
$500 or more, enter the amount of any self-assessed underpayment            return, your credit will be applied to the next full tax year, unless 
of estimated tax penalty you figured on Form IL-2220, Penalty               you elect to apply the credit to a different tax year.
Worksheet 1, Line 22.                                                       Example 1: You file your 2022 calendar-year return on 
If you annualized your income in Step 6 of Form IL-2220, be sure            March 1, 2023, requesting to receive your overpayment as 
to check the box in Step 1, Line J of this Form IL-1065. Attach a           a credit. March 1, 2023, falls before the original filing and 
                                                                            payment due date of the 2022 tax year (April 18, 2023, for 
IL-1065 Instructions (R-12/22)                                                                                                     Page 11 of 25

      calendar-year filers). Your credit will be applied against your     liability?
      2023 tax year liability.
                                                                          If your 2022 return was filed
‰  after the original filing and payment due date of your return,         ‰                                                   
                                                                             on or before the extended due date of your return
    your credit will be applied to the next full tax year in which timely 
                                                                             (October 16, 2023, for calendar-year filers), your credit is 
    payments can be made as of the date you are filing this return, 
                                                                             considered to be paid on the original due date of this return 
    unless you elect to apply the credit to a different tax year. 
                                                                             (April 18, 2023, for calendar-year filers). 
      Example 2: You file your 2022 calendar-year return on 
                                                                             However, if all or a portion of your overpayment results from 
      August 4, 2023, requesting to receive your overpayment 
                                                                             payments made after the original due date of this return, that 
      as a credit. August 4, 2023, is after the original filing and 
                                                                             portion of your credit is considered to be paid on the date you 
      payment due date of the 2022 tax year (April 18, 2023, for 
                                                                             made the payment.
      calendar-year filers), but is before the original filing and 
      payment due date of the 2023 tax year (April 15, 2024, for                Example 1: You file your 2022 calendar-year return on 
      calendar-year filers). Your credit will be applied against your           or before the extended due date of your return requesting 
      2023 tax year liability.                                                  $500 be applied as a credit. All of your payments are made 
                                                                                before the original due date of your return. Your credit of 
      Example 3: You file your 2022 calendar-year return on 
                                                                                $500 will be considered to be paid on April 18, 2023. 
      April 28, 2024, requesting to receive your overpayment 
      as a credit. April 28, 2024, is after the original filing and             Example 2: You file your 2022 calendar-year return on 
      payment due date of the 2023 tax year (April 15, 2024, for                or before the extended due date of your return requesting 
      calendar-year filers), but is before the original filing and              $500 be applied as a credit. Your overpayment includes 
      payment due date of the 2024 tax year (April 15, 2025, for                payments of $400 you made before the original due 
      calendar-year filers). Your credit will be applied against your           date of your return, and a $100 payment you made on 
      2024 tax year liability.                                                  June 1, 2023. Your credit of $400 will be considered to be 
                                                                                paid on April 18, 2023. The remaining $100 credit will be 
        If you are filing your return after the extended due date, you 
                                                                                considered to be paid on June 1, 2023. 
may only elect to claim an overpayment credit for payments received 
on or before the date you filed your return. Any payments made after      ‰  after the extended due date of your return, your credit is 
the date you filed that return can only be claimed as an overpayment         considered to be paid on the date you filed the return on which 
credit on a subsequent amended return.                                       you made the election.
With what date will my credit apply against my tax                              Example 3: You file your 2022 calendar-year return on 
                                                                                December 1, 2023, requesting $500 be applied as a 

  PTE Income Worksheet
  1   Base Income from Line 35.                                                                          1                                00 
  2a  Amount from Line 26.                                                 2a                 00      
  2b  Amount from Line 27.                                                 2b                 00
  3   Add Lines 2a and 2b.                                                                               3                                00
  4   PTE base income. Add Lines 1 and 3.                                                                4                                00
  5   Nonbusiness income or loss.                                                                        5                                00                              
  6   Business income or loss included in Line 4 from non-unitary partnerships, partnerships 
      included on a Schedule UB, S corporations, trusts, or estates.                                     6                                00                              
  7   Add Lines 5 and 6.                                                                                 7                                00                              
  8   Business income or loss. Subtract Line 7 from Line 4.                                              8                                00                              
  9   Total sales everywhere. This amount cannot be negative.              9                  00                             
 10   Total sales inside Illinois. This amount cannot be negative.        10                  00                             
 11   Divide Line 10 by Line 9. Round to six decimal places.              11                             
 12   Business income or loss apportionable to Illinois. Multiply Line 8 by Line 11.                     12                               00                              
 13   Nonbusiness income or loss allocable to Illinois.                                                  13                               00                              
 14   Business income or loss apportionable to Illinois from non-unitary partnerships, partnerships 
      included on a Schedule UB, S corporations, trusts, or estates.                                     14                               00           
 15   PTE Income. Add Lines 12 through 14. Enter this amount on Line 60.                                 15                               00 

 PTE Worksheet Instructions
 Lines 1 through 4 — Follow the instructions on the worksheet. 
 Lines 5 and 13 — Complete a pro forma Illinois Schedule NB allocating nonbusiness income amounts to Illinois including the portion of 
 nonbusiness income or loss distributable to partners subject to replacement tax reported from Form IL-1065, Lines 21 and 27.
 Line 6 through 12 — Follow the instructions for Form IL-1065, Lines 37 through 43.  
 Line 14 — Follow the instructions for Form IL-1065, Line 45, but do not include any income from a partnership or S corporation that made 
 the PTE election.

Page 12 of 25                                                                                                            IL-1065 Instructions (R-12/22)

       credit. Your credit of $500 will be considered to be paid on               financial institution for your account number. 
       December 1, 2023, because you filed your return after the 
       extended due date of your 2022 calendar-year return.
May I apply my credit to a different tax year? 
Yes. If you wish to apply your credit to a tax year other than the one 
during which you file this return, you must submit a separate request 
in writing to: 
ILLINOIS DEPARTMENT OF REVENUE
PO BOX 19004
SPRINGFIELD IL 62794-9004
    Submit your request at the time you file your return. Do not 
submit your return to this address.
Your request must include 
•  your name,                                                          Do not use your account and routing numbers from your checking 
•  your FEIN,                                                          or savings accountdeposit slip.Do not      include your check number. 
•  the tax year of the return creating the overpayment, and            Include hyphens, but omit spaces and special symbols. You may 
                                                                       have unused boxes. 
•  the tax year you wish to have the credit apply.
                                                                                If your financial institution does not honor your request for 
If you do not follow these instructions, your election will be         direct deposit, we will send you a check instead.
considered invalid and we will not apply your credit as you requested.
                                                                                We do not support international ACH transactions. We will 
If you submit a valid request, we will apply your credit as you        only deposit refunds into accounts located within the United States. 
requested and notify you. Once made, your election to change the       If your financial institution is located outside the United States, we 
tax year to which your credit will apply is irrevocable. Requests will will send you a check instead of depositing your refund into your 
be worked in the order we receive them.                                account.
    You may only apply your credit to tax years occurring after        Line 71 — Follow the instructions on the form. This is your amount 
the year of the return creating the overpayment. If you request to     of tax due that must be paid in full if $1 or more. If you are not paying 
apply more credit than our records show you have available, we         electronically, complete a payment voucher, Form IL-1065-V, make 
will apply the maximum amount available and notify you of the          your check or money order payable to “Illinois Department of 
difference.                                                            Revenue” and attach them to the front of the return.
Line 69 — Follow the instructions on the form. Your refund will not             If you are paying electronically do not complete and attach 
be issued if you do not file a processable return.                     a payment voucher.
    Your refund may be reduced by us to satisfy any unpaid tax,        You should also enter the amount you are paying in the box 
penalty, and interest due for this year or any other year.             located on the top of Page 1 of the Form IL-1065.
Line 70 — Direct deposit information.                                  We encourage you to let us figure your penalties and interest and 
If you choose to deposit your refund directly into your checking or    send you a bill instead of determining these amounts yourself. 
savings account, you must                                              We will compute any penalty and interest due and notify you. See 
•  Enter your routing number.                                          General Information, “What are the penalties and interest?”
       •       For a checking account, your routing number must be     Step 10 — Signature, date, and paid preparer’s 
           nine digits and the first two digits must be 01 through     information
           12 or 21 through 32. 
                                                                       You must sign and date your return. If you do not sign your return, 
           The sample check following these instructions has an        it will not be considered filed and you may be subject to a non-filer 
           example of a routing number.                                penalty.
       •       For a savings account, you must contact your            If you pay someone to prepare your return, the income tax return 
               financial institution for your routing number.          preparer must also sign and date the return, enter the preparer tax 
•  Check the appropriate box to indicate whether you want your         identification number (PTIN) issued to them by the Internal Revenue 
  refund deposited into your checking or savings account.              Service, and provide their firm’s name, FEIN, address, and phone 
•  Enter your account number.                                          number.
       •       For a checking account, your account number may         If you want to allow the paid preparer listed in this step to discuss 
               be up to 17 digits.                                     this return with IDOR check the box. This authorization will allow 
                                                                       your paid preparer to answer any questions that arise during the 
           The sample check following these instructions has an        processing of your return, call us with questions about your return, 
           example of an account number.                               and receive or respond to notices we send. The authorization will 
       •       For a savings account, you must contact your            automatically end no later than the due date for filing your 2023 tax 
                                                                       return (excluding extensions). You may revoke the authorization at 
                                                                       any time by calling or writing us.

IL-1065 Instructions (R-12/22)                                                                                                     Page 13 of 25

                                   Apportionment Formulas

Certain businesses that derive their income from inside and outside  •  the property is shipped from Illinois to another state and you are 
Illinois require an apportionment formula. The following definitions not taxable in the state of the purchaser. 
will help in completing Step 6.                                      For radio and television broadcasting (including cable and satellite 
 Business income — See General Information, “Business                broadcasting), the following sales are in Illinois:
 income” under “Definitions to help you complete your                •  advertising revenue received from an advertiser whose 
 Form IL-1065.”                                                      headquarters is in Illinois;
 Financial organization — any bank, bank holding company,            •  fees received by a broadcaster from its viewers or listeners in 
 trust company, savings bank, industrial bank, land bank, safe       Illinois;
 deposit company, private banker, savings and loan association, 
 building and loan association, credit union, currency exchange,     •  in the case of fees received by a broadcaster from the producer 
 cooperative bank, small loan company, sales finance company,        or other owner of the contents of a program, the percentage of 
 investment company, or any person owned by a bank or bank           the fees equal to the percentage of the broadcast’s viewing or 
 holding company.                                                    listening audience located in Illinois; or 
 Revenue miles — A revenue mile is the transportation of one         •  in the case of a person who owns the contents of a program and 
 passenger, or one net ton of freight, the distance of one mile.     who provides the contents to a broadcaster for a fee or other 
                                                                     charge, the fees received for that program from a broadcaster 
 Federally regulated exchange — A federally regulated                located in Illinois. 
 exchange is:
                                                                     If the “sales everywhere” amount includes gross receipts from 
 •  a regulated entity as defined in 7 U.S.C. Sections 1a(40)(A),    the licensing, sale, or other disposition of patents, copyrights, 
 1a(40)(B), or 1a(40)(C);                                            trademarks, and other similar items of intangible personal property, 
 •  an exchange or clearing agency as defined in 15 U.S.C.           and the receipts are not covered by the broadcasting rules, then 
 Sections 78c(a)(1) or 78c(a)(23);                                   these receipts should be allocated in Illinois to the extent the item 
 •  any entity regulated under any successor regulatory structure    is used in Illinois during the year the gross receipts are included in 
 to a registered entity, exchange, or clearing agency; or            gross income. An item is used in Illinois if 
 •  any member of the same unitary group if 50 percent               •  a patent is employed in production, fabrication, manufacturing, or 
 or more of the business receipts of the unitary business group      other processing in Illinois or if the patented product is produced 
  for the taxable year are attributable to the matching, execution,  in Illinois;
  or clearing of transactions conducted by members of the group      •  copyrighted material is printed or other publications originated in 
  described in the first three bullet points above.                  Illinois; or
                                                                     •  the commercial domicile of the licensee or purchaser of a 
What if I am a sales company?                                        trademark or other item of intangible personal property is in 
If you checked the box in Step 1, Line E, indicating that you are a  Illinois.
sales company and your income is derived from inside and outside
Illinois, you must apportion your business income as follows:                  If you cannot determine from your (or your related party’s) 
Include gross receipts from the license, sale, or other disposition  books and records in which state an item is used, do not include the 
of patents, copyrights, trademarks, and similar items of intangible  gross receipts from that item in the numerator or the denominator of 
personal property in the numerator and denominator of your sales     the sales factor.
factor only if these gross receipts are more than 50 percent of the  For sales of telecommunications services, the following sales are in 
total gross receipts included in gross income for this tax year and  Illinois:
each of the two immediately preceding tax years.
                                                                     •  sales of telecommunications service sold on a call-by-call basis, 
Do not include the following items of income in the numerator or     where the call both originates and terminates in Illinois, or the 
denominator of your sales factor:                                    call either originates or terminates in Illinois and the customer’s 
•  dividends;                                                        service address is in Illinois;
•  amounts included under IRC Section 78;                            •  retail sales of postpaid telecommunications service if the point of 
                                                                     origination of the signal is in Illinois;
•  IRC Section 965 inclusion;
                                                                     •  retail sales of prepaid telecommunications service where 
•  Global Intangible Low-Taxed Income (GILTI) income under IRC       the purchaser receives the prepaid card or other means of 
 Section 951A;                                                       conveyance at a location in Illinois;
•  subpart F income as defined in IRC Section 952; and               •  charges imposed at a channel termination point in Illinois;
•  any item of income excluded or deducted from base income.         •  charges for channel mileage between two channel termination 
For more information on what should be included in the numerator     points in Illinois;
or denominator of your sales factor, see 86 Ill. Adm. Code Sections  •  charges for channel mileage between one or more channel 
100.3370 and 100.3380.                                               termination points in Illinois and one or more channel termination 
Sales of tangible personal property are in Illinois if               points outside Illinois, times the number of channel termination 
                                                                     points in Illinois divided by total termination channels;
•  the property is delivered or shipped from anywhere to a purchaser 
                                                                     •  charges for services ancillary to sales of services in Illinois. If you 
 in Illinois, other than the United States government, regardless of 
 the Free on Board (f.o.b.) point or other conditions of the sale;   provide ancillary services, but cannot determine where the sales 
                                                                     of the related services are located, your sales are in Illinois if your 
•  the property is shipped from Illinois to any place and the        customer is in Illinois;
 purchaser is the United States government; or

Page 14 of 25                                                                                                     IL-1065 Instructions (R-12/22)

•  access fees charged to a reseller of telecommunication for a call      –   unsecured commercial or installment loans where the        
that both originates and terminates in Illinois;                              proceeds of the loan are applied in Illinois. If the place of   
•  50 percent of access fees charged to a reseller of                         application cannot be determined, the gross receipts are in 
telecommunications services for an interstate call that originates            Illinois if the office of the borrower from which the loan was 
or terminates in Illinois; and                                                negotiated is in Illinois. If neither the place of application 
                                                                              nor the office of the borrower can be determined, do not 
•  end user access line charges, if the customer’s service address is 
                                                                              include the gross receipts in Lines 40 or 41; and
in Illinois.
                                                                          –  credit card receivables billed to a customer in Illinois.
For more information, see 86 Ill. Adm. Code Section 100.3371.
                                                                         •  sales of travelers checks and money orders at a location in Illinois;
Illinois lottery winnings and proceeds from sales or other transfers of 
rights to lottery winnings are in Illinois.                              •  interest, dividends, net gains, and other income from investment 
                                                                          and trading assets and activities, where the majority of your 
For taxable years ending on or after December 31, 2019, gross 
                                                                          contacts with the asset or activity is in Illinois. The state to which 
receipts from winnings from pari-mutuel wagering conducted at a 
                                                                          an asset or activity is assigned in your books and records for 
wagering facility licensed under the Illinois Horse Racing Act of 1975 
                                                                          federal or state regulatory requirements is presumed to be proper 
or from winnings from gambling games conducted on a riverboat 
                                                                          unless a majority of the evidence shows otherwise or you do not 
or in a casino or organization gaming facility licensed under the 
                                                                          have a fixed place of business in that state. If the place with the 
Illinois Gambling Act are Illinois sales and must be included in the 
                                                                          majority of contacts cannot be determined under these rules, 
numerator of the sales factor. 
                                                                          the gross receipts are in Illinois if your commercial domicile is in 
For taxable years ending on or after December 31, 2021, payments          Illinois. 
from Illinois sources of wagering and winnings conducted in 
                                                                         •  any other transaction, if the gross receipts would be included on 
accordance with the Sports Wagering Act are allocable to Illinois. 
                                                                          Line 41 under the general instructions for Line 41. 
Sales, other than sales of tangible personal property or                 For more information, see 86 Ill. Adm. Code Section 100.3405.
telecommunications service, and gross receipts from broadcasting, 
or the licensing, sale, or other disposition of patents, copyrights,     Divide Line 41 by Line 40 and enter the result, rounded to six decimal 
trademarks, and similar items of intangible personal property, or        places, on Line 42. Complete Lines 43 through 46 as indicated in 
Illinois lottery winnings or sales proceeds, are in Illinois as follows: Specific Instructions for Step 6, Figure your income allocable to 
                                                                         Illinois. 
•  sales or leases of real property in Illinois;
•  leases or rentals of tangible personal property, to the extent it is  What if I am a transportation company?
located in Illinois during the rental period;                            If you checked the box in Step 1, Line E, indicating that you are 
•  interest, net gains, and other items of income from intangible        a company that furnishes transportation service both inside and 
personal property received by a taxpayer who is a dealer in              outside Illinois, cross out the word “sales” on Lines 40 and 41 and 
that property from a customer who is a resident of Illinois (for         write “Transportation.” You must apportion business income as 
individuals) or who is commercially domiciled in Illinois (for all       follows:
other customers). A taxpayer without actual knowledge of the              Transportation by airline — On Line 40, enter the amount of 
residence or commercial domicile of a customer may use the                revenue miles everywhere. On Line 41, enter the amount of 
customer’s billing address.                                               revenue miles in Illinois. Divide Line 41 by Line 40 and enter the 
•  interest, net gains, and other items of income from intangible         result, rounded to six decimal places, on Line 42.
personal property received by a taxpayer who is not a dealer              Other modes of transportation — On Line 40, enter the amount 
in that property, if the income-producing activity is performed in        of your gross receipts from providing transportation services. On 
Illinois or if the income-producing activity is performed inside and      Line 41 enter the amount of gross receipts from Illinois, as follows:
outside Illinois, and a greater proportion of the income-producing 
                                                                          •        all gross receipts from transportation that both originates  
activity is performed inside Illinois rather than outside Illinois, 
                                                                                   and terminates in Illinois; and
based on performance costs; or
                                                                          •        gross receipts from interstate transportation, multiplied  
•  in all other cases, if the services are received in Illinois.
                                                                                   by a fraction equal to the miles traveled in Illinois on all  
For more information, see 86 Ill. Adm. Code Section 100.3370.                      interstate trips divided by miles traveled everywhere on  
                                                                                   all interstate trips.
What if I am a financial organization?
                                                                         Divide Line 41 by Line 40 and enter the result, rounded to six decimal 
If you checked the box in Step 1, Line E, indicating that you are a 
                                                                         places, on Line 42.
financial organization and your income is derived from inside and 
outside Illinois, cross out the word “sales” on Lines 40 and 41 and       Transportation of both freight and passengers or 
write “Financial organization.”                                           transportation by airline and other modes — Compute 
                                                                          separate fractions for freight transportation and passenger 
On Line 40, enter the amount of gross receipts from all sources. 
                                                                          transportation by airline and for freight transportation and 
On Line 41 enter the amount of gross receipts from:                       passenger transportation by all other modes of transportation 
•  sales or leases of real property located in Illinois;                  under A and B, in the list above and enter on Line 42 the average 
                                                                          of those fractions, weighted by the gross receipts from freight or 
•  leases or rentals of tangible personal property, to the extent it is   passenger transportation by airline or other modes, rounded to six 
located in Illinois during the rental period;                             decimal places
•  interest income, commissions, fees, gains on disposition, and         For more information, see 86 Ill. Adm. Code Section 100.3450. 
other receipts from:
                                                                         Complete Lines 43 through 46 as indicated in Specific Instructions for 
–   loans secured by real or tangible personal property located          Step 6 ,  Figure your income allocable to Illinois. 
in Illinois;
–   unsecured consumer loans to a resident of Illinois; 
IL-1065 Instructions (R-12/22)                                                                                                 Page 15 of 25

What if I am a federally regulated exchange?                           to its own business income and apportionment factors (Illinois and 
If you checked the box in Step 1, Line E, indicating that you are a    everywhere). This rule applies to you if you are unitary with one or 
federally regulated exchange and your income is derived from inside    more of your partners or if you are a partner in another partnership 
and outside Illinois, cross out the word “sales” on Lines 40 and 41    and are engaged in a unitary business with that partnership. 
and write “Exchange.” You may apportion your business income as        If the following applies, you must file a Schedule UB: If you are 
follows:                                                               a partnership who is a shareholder in a corporation and are engaged 
On Line 40, enter the amount of business income from all sources.      in a unitary business with that corporation, or if you are owned more 
On Line 41, enter the amount of business income from:                  than 90 percent by members of a unitary business group (determined 
                                                                       without regard to the rule prohibiting taxpayers conducting 80 percent 
• receipts attributable to transactions executed on a physical         or more of their business activities outside the United States from 
  trading floor located in Illinois;                                   being included in a unitary business group), you are required to use a 
• receipts attributable to all other matching, execution, or clearing  Schedule UB to apportion your business income. See the instructions 
  transactions. This includes, without limitation, receipts from the   for the Schedule UB for more information. Once the Schedule UB 
  provision of matching, execution, or clearing services to another    has been completed, you must apportion your business income as 
  entity.                                                              follows: 
  –       Multiply this amount by 27.54 percent (.2754) for tax years  
          ending on or after December 31, 2013; and                    On Line 40, enter the “everywhere” sales factor of the entire unitary 
                                                                       business group from Illinois Schedule UB, Step 4, Line 2, Column D. 
• all other receipts for sales in Illinois.
                                                                       On Line 41, enter only your Illinois sales (including your share of 
Divide Line 41 by Line 40 and enter the result, rounded to six decimal sales of any unitary partnerships in which you are a partner). 
places, on Line 42. Complete Lines 43 through 46 as indicated in       On Lines 44 and 45, enter your own nonbusiness income and the 
Specific Instructions for Step 6, Figure your income allocable to      Illinois portion of business income from non-unitary partnerships in 
Illinois.                                                              which you are a partner, from partnerships included on a Schedule 
           For any tax year, the Illinois apportionment percentage     UB and in which you are a partner, from S corporations in which 
computed using this formula may never be less than the Illinois        you are a shareholder, or from trusts or estates of which you are a 
apportionment percentage computed for the first full tax year ending   beneficiary.
on or after December 31, 2013, for which the taxpayer used this 
                                                                       What if I want to use an alternative 
formula. 
                                                                       apportionment formula?
What if I am a member of a unitary group?                              If the apportionment methods prescribed by IITA, Sections 304(a) 
The term “unitary business group” means a group of persons related     through (d), and (h) do not fairly and accurately represent the market 
through common ownership, whose business activities are integrated     for your goods, services, or other sources of business income, 
with, dependent on, and contribute to each other. In the case of a     or lead to a grossly distorted result, you may want to use a more 
corporation, common ownership is defined as the direct or indirect     accurate alternative method. If you want to use an alternative 
ownership or control of more than 50 percent of the outstanding        apportionment method, you must receive permission from IDOR 
voting stock of a corporation.                                         prior to filing your return. 
If the following applies, do not file a Schedule UB: If a partnership           Your request for an alternative apportionment formula must 
is engaged in a unitary business with one or more of its partners,     follow the requirement of 86 Ill. Adm. Code Section 100.3390. See 
but the unitary partners do not own substantially all of the interest  the regulations or contact IDOR for more information.
in the partnership, the partnership should not be included on a        If you receive permission to use an alternative formula, you must 
Schedule UB with the partners. Substantial ownership is defined as     attach to your Form IL-1065 a copy of the letter granting permission.
owning more than 90 percent of all the interest in the partnership.    Send your request to: 
If a Schedule UB should not be filed, the partnership completes its 
Form IL-1065 in the same manner as a non-unitary partnership,           ILLINOIS DEPARTMENT OF REVENUE
and each unitary partner must determine the portion of its business     LEGAL SERVICES OFFICE
income taxed by Illinois by adding its share of that partnership’s      SENIOR COUNSEL - INCOME TAX, 5-500
business income and apportionment factors (Illinois and everywhere)     101 WEST JEFFERSON STREET
                                                                        SPRINGFIELD IL  62702

                                     Illinois Schedule B Instructions 
                                                                       ‰  Complete Section B of Illinois Schedule B 
                   General Information                                                                            before completing 
                                                                        Section A of Illinois Schedule B. Section B reports specific 
Read this information before completing Illinois                        amounts from each Schedule K-1-P and Schedule K-1-P(3) you 
Schedule B.                                                             completed. Section B is required to be completed in full in order 
Amounts listed on the Schedule(s) K-1-P and Schedule(s) K-1-P(3)        to avoid processing delays, further correspondence, or delays in 
you complete are carried to your Illinois Schedule B and then           the processing of any overpayments. 
reported on your Form IL-1120-ST or Form IL-1065. Therefore, you 
                                                                       ‰  Complete Section A of the Illinois Schedule B. Section A reports 
must complete Schedule(s) K-1-P and Schedule(s) K-1-P(3) before 
                                                                        total amounts from Section B, and is required to be completed in 
completing Schedule B. 
                                                                        full in order to avoid processing delays, further correspondence, 
In order to ensure you complete Schedule B correctly, do the            or delays in the processing of any overpayments. 
following in order:
                                                                       ‰  Carry the amount from Illinois Schedule B, Section A, Line 3 and 
‰  Complete all Schedule(s) K-1-P and Schedule(s) K-1-P(3), as          Line 5 to your Form IL-1120-ST or Form IL-1065, as applicable. 
  applicable, for your members before completing any section of 
                                                                       See the Schedule K-1-P(1) instructions and Illinois Schedule B 
  Illinois Schedule B. The information reported on Schedule(s) 
                                                                       specific instructions for more information.
  K-1-P and Schedule(s) K-1-P(3) will be used to complete Illinois 
  Schedule B. See Schedule K-1-P(1) for more information.
Page 16 of 25                                                                                                     IL-1065 Instructions (R-12/22)

What is the purpose of Illinois Schedule B?                               What do Section B, Lines G through J report?
The purpose of Illinois Schedule B, Partners’ or Shareholders’            Lines G through J report certain items of income, credits, and 
Information, is for you to identify any person who was a partner or       pass-through withholding you reported to your nonresident members 
shareholder at any time during your tax year.                             on the Schedule K-1-P you issued to them.
The Illinois Schedule B also allows you to identify your partners or      How do I determine the amounts to report in 
shareholders that are subject to the Illinois Personal Property Tax       Section B, Lines G through J?
Replacement Income Tax and to figure the share of distributable 
                                                                          Before completing Illinois Schedule B you must complete 
income or loss that is to be added to or subtracted from your base 
                                                                          Schedule(s) K-1-P and Schedule(s) K-1-P(3) for each of your 
income. 
                                                                          nonresident members, as applicable. The amounts reported on those 
Is Schedule B required?                                                   schedules will be used to complete Illinois Schedule B, Section B, 
Yes. You are required to have a copy of this form on file. You            Lines G through J. 
must attach a copy of Schedule B to your Form IL-1065, Illinois           See Schedule K-1-P(1) for instructions and more information about 
Partnership Replacement Tax Return to support                             Schedule K-1-P(3).
• the addition modification claimed on Form IL-1065, Step 4,              What do I report in Section B, Line K?
  Line 21, 
                                                                          Line K is used to report the PTE tax credit you distribute to your 
• the subtraction modification claimed on Form IL-1065, Step 5,           partners if you elected to file and pay pass-through entity tax. 
  Line 27, 
• the pass-through withholding you owe on behalf of your                  How do I determine the amounts to report in 
  nonresident members on Form IL-1065, Step 8, Line 59, or                Section B, Line K?
• the pass-through entity tax you pay on behalf of your members           Before completing Illinois Schedule B, Line K, you must determine 
  on Form IL-1065, Step 8, Line 61, and                                   each member’s portion of the PTE tax credit using the formula in the 
• the PTE tax credit you received and distributed to your members         Schedule B, Section B, Line K instructions.
  on Schedule(s) K-1-P.                                                   What do I report in Section B, Line L?
Therefore, you must follow the instructions for Illinois Schedule B,      Line L is used to report the PTE tax credit you receive and distribute 
complete it in full, and attach it to your return.                        to your partners. Do not include any PTE tax you are paying on 
         You must use forms prescribed by IDOR. Separate                  this line. 
statements not on forms provided or approved by IDOR will not             How do I determine the amounts to report in 
be accepted and you will be asked for appropriate documentation.          Section B, Line L?
Failure to comply with this requirement may delay the                     Use the Schedule(s) K-1-P or K-1-T you received to determine the 
processing of your return or the generation of any overpayment.           amount of PTE tax credit you received. Distribute the PTE tax credit 
Additionally, failure to submit appropriate documentation when 
                                                                          based on each member’s share.
requested may result in a referral to our Audit Bureau for compliance 
action.                                                                   Specific Instructions
Partnerships must complete Illinois Schedule B. Do not send a             Section A:  Total members’ information
computer printout with line numbers and dollar amounts attached            Complete Schedule(s) K-1-P and Schedule(s) K-1-P(3), 
to a blank copy of the schedule. Computer generated printouts             as applicable, and all of Illinois Schedule B, Section B, before 
are not acceptable, even if they are in the same format as IDOR’s         completing Section A.
forms. Computer generated forms from an IDOR-approved software 
developer are acceptable.                                                 Illinois Schedule B, Section A should be completed using the totals 
                                                                          from Illinois Schedule B, Section B. When you submit your return you 
What is a resident?                                                       should only attach a single page of Section A. If you require multiple 
A resident is                                                             pages of Section B, you may attach as many pages of Section B as 
•  an individual who is present in Illinois for other than a temporary or required behind Section A.
  transitory purpose;                                                     Lines 1 through 3 — Report amounts for both resident and 
•  an individual who is absent from Illinois for a temporary or           nonresident members.
  transitory purpose but who is domiciled in Illinois;                    Line 1 — Add the amounts you reported on Step 3, Column A, 
•  the estate of a decedent who at his or her death was domiciled in      Line 10 through Line 19, of all the Schedule(s) K-1-P you issued to 
  Illinois;                                                               your partners and enter the total here. Include amounts you reported 
•  a trust created by a will of a decedent who at his or her death was    to both your resident and nonresident members.
  domiciled in Illinois; or                                               Line 2 — Add the amounts you reported on Step 7, Line 52a 
•  an irrevocable trust, whose grantor was domiciled in Illinois at the   through Line 52x,  and Step 7, Lines 53a through 53b, of all the 
  time the trust became irrevocable. For purposes of this definition,     Schedule(s) K-1-P you issued to your partners and enter the total 
  a trust is irrevocable to the extent that the grantor is not treated as here. Include amounts you reported to both your resident and 
  the owner of the trust under Internal Revenue Code (IRC) Sections       nonresident members.
  671 through 678.                                                        Line 3 — Add the amounts shown in Section B, Line E for all the 
                                                                          partners or shareholders for which you have checked the box in 
What is a nonresident?
                                                                          Section B, Line D. 
A nonresident is a person who is not a resident, as previously 
                                                                           Do not include 
defined. Corporations, S corporations, partnerships, and exempt 
organizations are considered nonresidents for purposes of                 •          partners that are identified as individuals or estates in 
Illinois Schedule B.                                                                 Section B, Line B, or
                                                                          •          grantor trusts or other disregarded entities whose 
                                                                                     grantor or owner is an individual or estate. 

IL-1065 Instructions (R-12/22)                                                                                                    Page 17 of 25

Enter the total amount on this line. If this is a                       If the partner or shareholder is a trust or an estate, use the 
•  positive amount, enter this amount on your Form IL-1065, Line 27     following formats:
 or Form IL-1120-ST, Line 24.                                           John Doe Bankruptcy Trust                           Estate of John Doe
•  negative amount (loss), enter this amount as a positive amount on    % Mary Doe, Trustee                                 111 W Main St., Ste 4A
 your Form IL-1065, Line 21 or Form IL-1120-ST, Line 20.                111 W Main Street, Suite 4A                         Anytown
Lines 4 through 5 — Report amounts for nonresident                      Anytown                                             IL  62666
members only.                                                           IL  62666
Line 4a — Enter the total amount of pass-through withholding you        If the partner or shareholder is a corporation (including 
reported on the Schedule(s) K-1-P you issued to your nonresident        S corporations), or a partnership, use the following formats:
individual members only. Total the amounts reported in Section B,       Illinois Big Business Group         Illinois Small Business Group
Line J, for members that are identified with an “I” in Section B,       % John Doe, VP Finance              % Mary Doe
Line B, and enter it here.                                              111 West Main Street, Suite 4       111 West Main Street
Line 4b — Enter the total amount of pass-through withholding you        Anytown                             Anytown
reported on the Schedule(s) K-1-P you issued to your nonresident        IL  62666                                  IL  62666
estate members only. Total the amounts reported in Section B, 
Line J, for members that are identified with an “M” in Section B, Line  Line B — Indicate the type of each partner’s or shareholder’s 
B, and enter it here.                                                   organization. Enter
Line 4c — Enter the total amount of pass-through withholding you        •  “I” for individual  
reported on the Schedule(s) K-1-P you issued to your partnership        •  “P” for partnership 
and S corporation members only. Total the amounts reported in           •  “M” for estate            
Section B, Line J, for members that are identified with a “P” or “S” in •  “T” for trust             
Section B, Line B, and enter it here.
                                                                        •  “C” for C corporation
Line 4d — Enter the total amount of pass-through withholding you 
                                                                        •  “S” for S corporation
reported on the Schedule(s) K-1-P you issued to your nonresident 
trust members only. Include members identified as an exempt             •  “A” for exempt organization (trust)
organization (trust). Total the amounts reported in Section B, Line J,  •  “N” for exempt organization (corporation)
for members that are identified with a “T” or “A” in Section B,                If this partner is a grantor trust or other disregarded entity, 
Line B, and enter it here.                                              enter the letter that corresponds to the tax type of the grantor or 
Line 4e — Enter the total amount of pass-through withholding you        owner.
reported on the Schedule(s) K-1-P you issued to your C corporation      Line C — Enter the entire Social Security number (SSN) or federal 
members only. Include members identified as an exempt                   employer identification number (FEIN) of each partner.
organization (corporation). Total the amounts reported in Section B,           If the partner is a foreign entity and does not have an SSN 
Line J, for members that are identified with a “C” or “N” in Section B, or FEIN, leave this line blank for that partner. If you leave this line 
Line B, and enter it here.                                              blank, you may be contacted for further information.
Line 5 — Add Section A, Lines 4a through 4e of this Illinois            Line D — Check the box if the partner is subject to the Illinois 
Schedule B and enter this amount here and on Form IL-1065,              Personal Property Tax Replacement Income Tax or is an exempt 
Line 59 or Form IL-1120-ST, Line 59. The amount on Line 5 should        organization (including an Employee Stock Ownership Plan (ESOP)). 
match the total amount from Schedule B, Section B, Line J for all       Individuals, estates, or grantor trusts and other disregarded entities 
members on all pages.                                                   whose grantors or owners are individuals or estates are not subject 
Lines 6 and 7 —                                                         to this tax. 
Line 6 — Add Section B, Line K for all members of this Illinois         Line E — Enter the total amount of base income or loss distributable 
Schedule B and enter the total here. Enter zero if you paid             to this partner, using the Line E Worksheet on Page 19. Enter the 
pass-through withholding.                                               amount from Line E Worksheet, Line 5, here. The total of all the 
Line 7 — Add Section B, Line L for all members of this Illinois         amounts in Line E must equal your total base income, computed 
Schedule B and enter the total here. This amount should equal the       without regard to the addition claimed on your Form IL-1065, Step 4, 
total of all Schedule(s) K-1-P, Step 7, Line 53a and Schedule(s)        Line 21, or the subtraction claimed on your Form IL-1065, Step 5, 
K-1-T, Step 7, Line 50 you received. Attach copies of all               Lines 27.
Schedule(s) K-1-P and K-1-T you received to your Form IL-1065.          Line F — If the partner was excluded from pass-through withholding 
If you completed multiple pages of Section B, complete Section A        indicate the reason by entering
one time reporting the totals from all pages of Section B. Place all    •  “T” if you elect to pay PTE tax, 
pages of Section B behind the single page of Section A, and attach      •  “R” if the partner is an Illinois resident,
them to your return.                                                    •  “E” if the partner provided you a Form IL-1000-E, Certificate of 
Section B:     Members’ information                                     Exemption for Pass-through Withholding, indicating that they would 
Columns 1 through 4 — Enter each member’s information                   pay their own tax liability,
using the instructions below.                                                      Partners who provide you Form IL-1000-E must not be 
Line A — Enter the name and address of each partner or                  individual taxpayers. 
shareholder. Use the following examples as a guide.                     •  “P” if you are a publicly-traded partnership or an investment 
If the partner or shareholder is an individual, use the following       partnership and therefore not required to make pass-through 
formats:                                                                withholding payments on behalf of your partners, or
John Doe              John and Mary Doe           John Doe              •  “N” if the partner or shareholder was an exempt organization and 
                                                                        you did not make pass-through withholding payments on their 
111 W. Main Street    111 W Main Street           % Mary Doe
                                                                        behalf.  
Anytown               Anytown                     111 W Main St. #5A
IL  62666             IL  62666                   Anytown
 Page 18 of 25                                    IL  62666                                                                 IL-1065 Instructions (R-12/22)

            Taxpayers are not required to make pass-through            •    If the pass-through entity does make the election to pay PTE 
  withholding payments on behalf of their exempt organization               tax, then it passes through to its members both 
  members, but may do so for tax year ending on or after                    •       the credit for the PTE tax it pays (Line K) and 
  December 31, 2014.                                                        •       each member’s distributive share of the PTE tax credit it 
  If you elected to make pass-through withholding payments on behalf                received from electing pass-through entities in which it is a 
  of an exempt organization member, leave this line blank for that                  member (Line L).  
  member and complete Lines G through J.                                    Add each member’s Line K and Line L. Enter the total on each 
Lines G through J — Provide the following information from the              member’s Schedule K-1-P, Step 7, Line 53a. 
Schedule(s) K-1-P and Schedule(s) K-1-P(3) you completed for each 
                                                                       Line K — Enter the member’s share of the PTE tax credit. To 
member listed.                                                         determine the share of PTE tax credit due for each member, multiply 
Line G — Enter the amount you reported on Step 3, Line 12, of the      the member’s distributive share of pass-through entity income 
Schedule K-1-P(3) you completed for this member. This amount is this   reported on Form IL-1065, Line 60, by 4.95% (0.0495). 
member’s share of Illinois income subject to pass-through withholding. 
                                                                                       The total credits allocated to all members may not 
          This amount is a dollar amount. Do not list a percentage on  exceed the PTE liability reported on Form IL-1065, Line 61. The total 
this line.                                                             credits may also not exceed the PTE amount actually paid to IDOR. If 
Line H — Total the amount you reported on Step 3, Line 13, and         you overpaid your PTE liability, the overpayment may be refunded to 
Step 3, Line 16, of the Schedule K-1-P(3) you completed for this       the electing partnership or S corporation.
member. Enter that amount on Line H for this member. This amount is    Include this amount on each member’s Schedule K-1-P, Step 7, 
this member’s pass-through withholding before credits.                 Line 53a.  
Line I — Total the amount you reported on Step 3, Line 14, and                      This line should be blank if you made pass-through 
Step 3, Line 17, of the Schedule K-1-P(3) you completed for this       withholding payments.
member. Enter that amount on Line I for this member. This amount is 
this member’s distributable share of credits. 
                                                                            Member’s Schedule B, Line E amount    Total             Member’s 
Line J — Enter the amount of pass-through withholding that                                                        PTE       =       share of PTE 
you made on behalf of each member and reported to them on                   Total amount of Schedule B, Line E × tax paid           tax credit
Schedule K-1-P, Step 7, Line 55. This should match the amount 
reported on Step 3, Line 19, of the Schedule K-1-P(3) you completed    Line L — Enter each member’s distributive share of PTE tax credit 
for this member.                                                       you are passing through from Schedule(s) K-1-P or K-1-T you 
          This line should be blank if you elected to pay PTE tax.     received. The PTE tax credit is passed through to your members 
Lines K and L - If the pass-through entity is itself a member in       in the same proportion that the pass-through income is distributed 
an electing pass-through entity, the credit for PTE tax paid by the    to your members. Also include this amount on each member’s 
electing pass-through entity passes through to its members as          Schedule K-1-P, Step 7, Line 53a.
follows:                                                               If you have more than four members to report, and additional 
• If the pass-through entitydoes not make the election to              space is needed, complete and attach additional pages of Illinois 
  pay PTE tax, it will only be passing through each member’s           Schedule B, Section B. After you have completed Section B, listing 
  distributive share of the PTE tax credit that it received on         all required amounts for your members, complete the single page of 
  Schedule(s) K-1-P from electing pass-through entities in which it    Illinois Schedule B, Section A.
  is a member (Line L). 

                                                         Line E Worksheet
Complete this worksheet for each partner or shareholder.

 1  Enter the share of income from Form IL-1065, or Form IL-1120-ST, Line 14 for this partner or shareholder.    1  _________________
 2  Enter the share of additions distributable to this partner or shareholder from 
    Form IL-1065, Lines 15 through 20 and Line 22 or 
    Form IL-1120-ST, Lines 15 through 19 and Line 21.                                                            2 _________________
 3  Add Lines 1 and 2.                                                                                           3 _________________
 4  Enter the share of subtractions distributable to this partner or shareholder from
    Form IL-1065, Lines 24 through 25 and 28 through 33 or 
    Form IL-1120-ST, Lines 23 and 25 through 33.                                                                 4 _________________
 5  Subtract Line 4 from Line 3. If Line 3 is greater than Line 4 (income), 
    enter the result as a positive amount in Line E for this partner or shareholder.
    If Line 4 is greater than Line 3 (loss), enter the result as a negative amount in 
    Line E for this partner or shareholder.                                                                      5 _________________
 
IL-1065 Instructions (R-12/22)                                                                                                      Page 19 of 25

                             Appendix A - Extension Tax Payment Worksheet
Use this worksheet if all of the following apply to you:
•     you are required to file Form IL-1065,
•     you cannot file your annual tax return by the due date, and
•     you complete this worksheet and determine you owe a tentative tax. 
If Line 7 of the worksheet shows you owe tentative tax, pay the full amount due either by filing and paying with Form IL-1065-V or by making 
your payment electronically. An extension of time to file does not extend the amount of time you have to make your payment. 
Reminder: Entities electing to pay PTE tax must make estimated payments if their total tax due is expected to be greater than $500. See 
Appendix C.
Extension Tax Payment Worksheet (for your records)
    1Enter the total tax you expect to owe for this tax year.                                          1 
     2Enter the total amount of estimated tax payments or prepayments you made and  
     any overpayment you elected to be credited for this tax year.                                     2 
  3  Enter any withholding reported to you and pass-through withholding made on your  
     behalf for this tax year.                                                                         3 
  4   Enter the amount of any previous tax payment you have made for this tax year.                    4 
  5   Enter the estimated replacement tax investment credits.                                          5 
  6   Add lines 2 through 5 and enter the result here.                                                 6 
  7   Subtract Line 6 from Line 1. This is your tentative tax due. Enter the result here and on 
     Form IL-1065-V.                                                                                   7 

Extension Tax Payment Worksheet Instructions
Line 1 —  Enter the total amount of replacement tax you expect to owe for this tax year (including recapture of investment credits using  
             Schedule 4255 and pass-through withholding payments you will owe on behalf of your members or PTE tax you elect to pay on  
             Schedule B).
Line 2 —  Enter the total amount of estimated tax payments or prepayments you made and any overpayment you elected to be credited for  
             this tax year.
Line 3 —  Enter the total amount of Illinois income tax withheld on Form(s) W-2G and the amount of pass-through withholding paid on    
             your behalf and reported to you on Illinois Schedule(s) K-1-P or K-1-T. 
Line 4 —  Enter the amount of any previous tax payment you have made for this tax year. 
Line 5 —   Enter the amount of any estimated replacement tax investment credits from Form IL-477, Replacement Tax Investment Credit.
Line 6 —  Add Lines 2 through 5. This is your total tax payments and credits.
Line 7 —  Subtract Line 6 from Line 1. This is your tentative tax due. If Line 7 is $1 or more, you must pay the amount due. If Line 7 is less  
             than $1, you do not have to pay. Do not attach your U.S. Form 7004 to your Form IL-1065-V.

       Pay electronically at tax.illinois.gov or use the current tax year’s Form IL-1065-V, Payment Voucher for 
Partnership Replacement Tax. 
Failure to use the correct voucher for your payments may result in your payment being misapplied, penalties and interest, a delay in the 
processing of your return, or a delay in the generation of any overpayment. 

Page 20 of 25                                                                                            IL-1065 Instructions (R-12/22)

     Appendix B - Pass-through Withholding Prepayment Worksheets
Use this worksheet to determine the amount to voluntarily prepay pass-through withholding on behalf of your partners.
 
Pass-through withholding prepayments are entirely voluntary; however, we suggest that you make your prepayments in four equal installments 
during the course of a year. 
     Use Appendix C to prepay your own estimated tax liability, including PTE tax.
      If you elect to file and pay PTE tax, do not use this worksheet. Taxpayers electing to file and pay PTE tax cannot report 
and pay pass-through withholding for their members. 

Check the following boxes to determine which worksheets you should complete. (You may check multiple boxes.)
  1 If you have nonresident individual and estate members that you wish to voluntarily prepay pass-through
    withholding on behalf of, check this box and complete Worksheet 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
  2 If you have partnership or S corporation members that you wish to voluntarily prepay pass-through withholding
    on behalf of, check this box and complete Worksheet 2 .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .
  3 If you have nonresident trust members that you wish to voluntarily prepay pass-through withholding on behalf of,
    check this box and complete Worksheet 3  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
  4 If you have corporation members that you wish to voluntarily prepay pass-through withholding on behalf of, check
    this box and complete Worksheet 4 .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .
Once the worksheets are complete, add the total from each worksheet:  
Worksheet 1, Line 7            ____________
Worksheet 2, Line 7            ____________ 
Worksheet 3, Line 11           ____________
Worksheet 4, Line 11           ____________
                               TOTAL _____________
This is the amount of each of your voluntary quarterly prepayments for pass-through withholding. Add this total to the amount from 
Appendix C, Step 3, Line 27 to determine your voluntary quarterly prepayments to be made with  Form IL-1065-V. These payments may be 
made at any time, up to and including the original due date of your return. 

     Pay electronically at tax.illinois.gov or use next tax year’s Form IL-1065-V to mail your payment. 
Failure to use the correct voucher for your pre-payments may result in your payment being misapplied, penalties and interest, a delay in the 
processing of your return, or a delay in the generation of any overpayment. 

Worksheet 1:  Figure your pass-through withholding prepayments for nonresident individual and estate members. If you have nonresident 
individual and estate members that you wish to voluntarily prepay pass-through withholding on behalf of, complete this worksheet to 
determine the amount of your prepayment. Keep this record for your files.
  1 Enter your nonresident individual and estate members’ share of business income apportioned 
    to Illinois expected in the tax year (cannot be less than zero).                                      1   
  2 Enter your nonresident individual and estate members’ share of nonbusiness income allocable
    to Illinois expected in the tax year (cannot be less than zero).                                         2 
  3 Add Lines 1 and 2 and enter the result.                                                               3 
  4 Multiply Line 3 by 4.95% (.0495) and enter the result.                                                4 
  5 Enter the amount of Illinois income tax credits expected in the tax year to be passed to the 
    members whose income is included on Lines 1 or 2.                                                     5 
  6 Subtract Line 5 from Line 4 and enter the result.                                                     6 
  7 Divide Line 6 by 4. This is the amount of each of your voluntary prepayments for nonresident
    individual and estate members.                                                                        7 

IL-1065 Instructions (R-12/22)                                                                                       Page 21 of 25

Appendix B - continued

Worksheet 2:  Figure your pass-through withholding prepayments for partnership or S corporation members. If you have partnership or 
S corporation members that you wish to voluntarily prepay pass-through withholding for, complete this worksheet to determine the amount of 
your prepayment. Keep this record for your files.
  1 Enter your partnership or S corporation members’ share of business income apportioned 
    to Illinois expected in the tax year (cannot be less than zero).                                      1   
  2 Enter your partnership or S corporation members’ share of nonbusiness income allocable
    to Illinois expected in the tax year (cannot be less than zero).                                            2 
  3 Add Lines 1 and 2 and enter the result.                                                               3 
  4 Multiply Line 3 by 1.5% (.015) and enter the result.                                                  4 
  5 Enter the amount of Illinois replacement tax investment credits expected in the tax year to be passed 
    to the members whose income is included on Lines 1 or 2.                                              5 
  6 Subtract Line 5 from Line 4 and enter the result.                                                     6 
  7 Divide Line 6 by 4. This is the amount of each of your voluntary prepayments for partnership or 
    S corporation members.                                                                                7 

Worksheet 3:  Figure your pass-through withholding prepayments for nonresident trust members. If you have nonresident trust members 
that you wish to voluntarily prepay pass-through withholding for, complete this worksheet to determine the amount of your prepayment. Keep 
this record for your files.
  1 Enter your nonresident trust members’ share of business income apportioned to Illinois
    expected in the tax year (cannot be less than zero).                                                  1   
  2 Enter your nonresident trust members’ share of nonbusiness income allocable to Illinois
    expected in the tax year (cannot be less than zero).                                                        2 
  3 Add Lines 1 and 2 and enter the result.                                                               3 
  4 Multiply Line 3 by 1.5% (.015) and enter the result.                                                  4 
  5 Enter the amount of Illinois replacement tax investment credits expected in the tax year to be 
    passed to the members whose income is included on Lines 1 or 2.                                       5 
  6 Subtract Line 5 from Line 4 and enter the result.                                                     6 
  7 Multiply Line 3 by 4.95% (.0495) and enter the result.                                                7 
  8 Enter the amount of Illinois income tax credits expected in the tax year to be passed to the 
    members whose income is included on Lines 1 or 2.                                                     8 
  9 Subtract Line 8 from Line 7 and enter the result.                                                     9 
 10 Add Line 6 and Line 9 and enter the result.                                                           10 
 11 Divide Line 10 by 4. This is the amount of each of your voluntary prepayments for nonresident
    trust members.                                                                                        11 

Page 22 of 25                                                                                                     IL-1065 Instructions (R-12/22)

Appendix B - continued

Worksheet 4:  Figure your pass-through withholding prepayments for corporation members. If you have corporation members that you 
wish to voluntarily prepay pass-through withholding for, complete this worksheet to determine the amount of your prepayment. Keep this 
record for your files.
  1 Enter your corporation members’ share of business income apportioned to Illinois expected in
    the tax year (cannot be less than zero).                                                              1   
  2 Enter your corporation members’ share of nonbusiness income allocable to Illinois expected in
    the tax year (cannot be less than zero).                                                                      2 
  3 Add Lines 1 and 2 and enter the result.                                                               3 
  4 Multiply Line 3 by 2.5% (.025) and enter the result.                                                  4 
  5 Enter the amount of Illinois replacement tax investment credits expected in the tax year to be 
    passed to the members whose income is included on Lines 1 or 2.                                       5 
  6 Subtract Line 5 from Line 4 and enter the result.                                                     6 
  7 Multiply Line 3 by 7% (.07) and enter the result.                                                     7 
  8 Enter the amount of Illinois income tax credits expected in the tax year to be passed to the 
    members whose income is included on Lines 1 or 2.                                                     8 
  9 Subtract Line 8 from Line 7 and enter the result.                                                     9 
 10 Add Line 6 and Line 9 and enter the result.                                                           10 
 11 Divide Line 10 by 4. This is the amount of each of your voluntary prepayments for corporation 
    members.                                                                                              11

            Appendix C - Estimated Payment and Prepayment Worksheet 
 Instructions
 If you elect to file and pay PTE tax and reasonably expect your total tax liability, including replacement tax and PTE tax, to 
 exceed $500 after Illinois tax credits and withholding payments made on your behalf, you are required to make estimated payments. 
 Complete Steps 1, 2, and 3 of this worksheet to compute your next tax year’s estimated tax payments.
 If you elect to file and pay PTE tax but you do not expect your tax liability, including replacement tax and PTE tax, to exceed $500, 
 you may voluntarily prepay next year’s taxes including PTE tax. Complete Steps 1, 2, and 3 of this worksheet to determine the amount of 
 your quarterly prepayment.
 If you do not elect to file and pay PTE tax, you may voluntarily prepay next year’s tax liability. Complete Steps 2 and 3 of this worksheet to 
 determine the amount of your quarterly tax liability prepayment. If you completed Appendix B, add the total from Step 3 to the total amount 
 from Appendix B to determine your quarterly prepayments to be made with Form IL-1065-V.
 If your income or your original estimated tax changes during the year, complete Step 4 of this worksheet to determine your adjusted 
 payment. 
          Keep this record for your files.
          Pay electronically at tax.illinois.gov or use next tax year’s Form IL-1065-V to mail your payment. 
 Failure to use the correct voucher for your estimated payments or prepayments may result in your payment being misapplied, penalties and 
 interest, a delay in the processing of your return, or a delay in the generation of any overpayment. 

IL-1065 Instructions (R-12/22)                                                                                              Page 23 of 25

Appendix C - continued

Step 1 - Figure your PTE Tax - Complete Step 1 only if you are filing and paying PTE tax.
 1    Enter the amount of base income (Line 35) expected in the next tax year.                                 1                       00 
 2a  Enter the amount of Personal service income or reasonable 
     allowance for compensation of partners expected in the 
     next tax year (Line 26).                                               2a                   00      
 2b  Enter the amount of income distributable to a partner subject to
     replacement tax expected in the next tax year (Line 27).               2b                   00
 3   Add Lines 2a and 2b.                                                                                      3                       00
 4   PTE base income. Add Lines 1 and 3.                                                                       4                       00
 5   Enter the amount of nonbusiness income or loss expected in the next tax year.                             5                       00                              
 6   Enter the amount of business income or loss included in Line 4 from non-unitary partnerships, 
     partnerships  included on a Schedule UB, S corporations, trusts, or estates expected in the 
     next tax year.                                                                                            6                       00                              
 7   Add Lines 5 and 6.                                                                                        7                       00                              
 8   Expected base income or loss. Subtract Line 7 from Line 4.                                                8                       00                              
 9   Enter the amount of total sales everywhere expected in 
     the next tax year.                                                     9                    00                             
  10 Enter the amount of total sales inside Illinois expected in 
     the next tax year.                                              10                          00                             
  11 Divide Line 10 by Line 9. Round to six decimal places.          11                               
  12 Business income or loss apportionable to Illinois expected in the next tax year. 
     Multiply Line 8 by Line 11.                                                                               12                      00                              
  13 Enter the amount of nonbusiness income or loss allocable to Illinois expected in the next tax year.       13                      00                              
  14 Enter the amount of business income or loss apportionable to Illinois from non-unitary partnerships, 
     partnerships  included on a Schedule UB, S corporations, trusts, or estates expected in the next tax year.
     Do not include any income from a partnership or S corporation that will make the PTE election.            14                      00           
  15 PTE Income. Add Lines 12 through 14.                                                                      15                      00 
  16 PTE Tax. Multiply Line 15 by 4.95 percent (.0495).                                                        16                      00 
Step 2 - Figure your Replacement Tax 
  17 Enter the amount of Illinois net income expected in the next tax year.                                    17                      00
  18 Multiply Line 17 by 1.5 percent (.015) and enter the result.                                              18                      00
  19 Enter the amount of recapture of investment credits expected in the next tax year.                        19                      00
  20 Add Lines 18 and 19. Enter the result.                                                                    20                      00
  21 Enter the amount of Illinois tax credits expected in the next tax year as calculated on the 
     corresponding Form IL-477 or Schedule 1299-A.                                                             20                      00
  22 Enter the amount of pass-through withholding expected to be made  on your behalf in the next tax 
     year on any Schedule K-1-P or Schedule K-1-T you receive.                                                 22                      00
  23 Enter the amount of any Illinois gambling and sports wagering winnings withholding shown on 
     the next tax year Form W-2G you expect to receive.                                                        23                      00
  24 Add Lines 21 through 23. Enter the result.                                                                24                      00
  25 Subtract Line 24 from Line 20 and enter the result.                                                       25                      00
Step 3 - Figure your Estimated Payments or Prepayments
  26 If you completed Step 1, add Lines 16 and 25. Otherwise, enter the amount from Line 25.                   26                      00
  27 Divide Line 26 by 4. This is the amount of your quarterly estimated payments or prepayments.              27                      00
   You may use pass-through withholding made on your behalf on any Schedule K-1-P or K-1-T you received to reduce the estimated tax 
  payment for the quarter in which the tax year shown on the Schedule K-1-P or K-1-T falls and any subsequent tax payment until the entire 
  credit is used.
   You may use Illinois gambling and sports wagering withholding shown on any Form W-2G you receive to reduce the estimated tax 
  payment for the quarter in which the gambling winnings were received and any subsequent tax payment until the entire credit is used.
   If you made the election to credit a prior year overpayment to the next tax year and
  •  the election was made on or before the extended due date of that prior year return, use the credit to reduce the first estimated tax  
     payment and any subsequent tax payments until the entire credit is used. 
  •  the election was made after the extended due date of that prior year return, the credit will be treated as paid on the date you   
     submitted the election. If that payment date is on or before an estimated payment due date, you may use the credit to reduce that  
     estimated tax payment and any subsequent tax payments until the entire credit is used.

Page 24 of 25                                                                                                     IL-1065 Instructions (R-12/22)

Appendix C - continued

Step 4 - Amended worksheet - Complete Step 4 if a change occurs in your original estimated tax.

  1  Enter the amount of PTE income expected in the next tax year.  
    If you are not electing to file and pay PTE tax, enter zero.                                              1 
  2 PTE Tax. Multiply Line 1 by 4.95 percent ( .0495).                                                        2 
  3  Enter the amount of Illinois net income expected in the next tax year.                                   3 
  4  Multiply Line 3 by 1.5 percent (.015) and enter the result.                                              4 
  5  Enter the amount of recapture of investment credits expected in the next tax year.                       5 
  6 Replacement Tax. Add Lines 4 through 5 and enter the result.                                              6 
  7  Enter the amount of Illinois tax credits expected in the next tax year as calculated on the corresponding
    Form IL-477 or Schedule 1299-A.                                                                           7 
  8  Enter the amount of pass-through withholding expected to be made on your behalf in the next tax year 
    on any Schedule K-1-P or Schedule K-1-T you receive.                                                      8 
  9  Enter the amount of any Illinois gambling and sports wagering winning withholding expected 
    on the next tax year Form W-2G.                                                                           9 
  10  Add Lines 7 through 9 and enter the result.                                                             10 
  11  Subtract Line 10 from Line 6 and enter the result. This amount may be negative.                         11 
12   Add Line 2 and 11.                                                                                       12 
13   Divide Line 12 by 4.                                                                                     13 
14   Multiply Line 13 by the number of previously due estimated payments.                                     14 
  15  Enter the amount of any estimated tax payments actually paid, timely prior year overpayments, timely 
    pass-through withholding and pass-through entity tax credit paid on your behalf, or timely Illinois 
    gambling and sports wagering winnings withholding shown on Form W-2G you received.                        15 
16  Subtract Line 15 from Line 14 and enter the result. This amount may be negative.                          16 
  17  Add Lines 13 and 16 and enter the result. 
    If positive, this is the amount due on your next payment due date. 
    If zero or negative, the amount due on your next payment due date is zero.
    If Line 17 is negative, continue to Line 18. Otherwise, stop here.                                        17 
18  If Line 17 is negative, enter that amount as a positive number.                                           18 
19  Subtract Line 18 from Line 13 and enter the result. 
    This is the amount due on the following due date, if applicable.                                          19 

     Pay electronically at tax.illinois.gov or use next tax year’s Form IL-1065-V to mail your payment. 
Failure to use the correct voucher for your estimated payments or prepayments may result in your payment being misapplied, penalties and 
interest, a delay in the processing of your return, or a delay in the generation of any overpayment. 

IL-1065 Instructions (R-12/22)                                                                                   Page 25 of 25