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CITY OF WALKER INCOME TAX
2021 PARTNERSHIP RETURN
Instructions for Form W-1065 for PARTNERSHIPS with business activity in Walker.
WHO MUST FILE A PARTNERSHIP RETURN Non-business income that may be taxable is reported in Schedule B, by type
Every partnership that conducted business activity in the City of Walker, of income. The taxable portion for resident and nonresident partners is
whether or not an office or place of business was maintained in the city, is determined in this schedule in columns 2 through 5. The taxable non-
required to file an annual return. Syndicates, joint ventures, pools and like business income is then transferred to Schedule C by showing the amounts
organizations will also use Form W-1065. applicable to the individual partners.
ROUNDING TO NEAREST DOLLAR Column 1 on page 1 is the final summary transferred from Schedule C,
Rounding tax amounts to the nearest dollar is allowed under a 1996 Income column 7.
Tax Ordinance amendment. ROUND ALL AMOUNTS TO THE NEAREST RESIDENT INDIVIDUAL PARTNERS are taxed on their entire distributive
DOLLAR. (i.e. $.00 to $.49 = $.00, $.50 to $.99 = next dollar.) share of the net profits of the partnership, including that arising from business
activities outside of Walker, interest, dividends, rents, royalties, other income,
FILING DATE: and gains from the sale or exchange of property, either tangible or intangible,
Calendar year taxpayers must file by May 2, 2022. Fiscal year taxpayers regardless of where such property was located.
must file within four (4) months after the end of their fiscal year.
NONRESIDENT INDIVIDUAL PARTNERS are taxed on their distributive
OPTION TO PAY TAX AND TAX RATE share of the partnership’s ordinary business income which is attributable to
At its election, the partnership may file either an information return or it may business activity in Walker, plus net rentals of tangible property in the City
compute and pay the tax which is due with respect to each partner's share of and gains from the sale or exchange of tangible property in the City.
the net profits of the business. The partnership may pay the tax for partners Nonresidents are not taxed on their share of net rentals on property located
only if it pays for ALL partners subject to the tax. Effective 1/1/88, the income outside the City, gains from the sale or exchange of tangible property located
tax rate is 1.0% for resident individual partners and all incorporated partners outside the City, gains from the sale or exchange of securities or other
and .5% for nonresident individual partners. intangible property, or on interest and dividends.
When the receipt of interest and other intangible income is directly related to
PARTNERSHIP AS TAXPAYER the nature of the business, such interest, etc. shall be considered business
If the partnership elects to pay the tax for the partners, the individual partners income taxable to nonresidents, and is to be included in the ordinary business
are not required to file a return if such partners have no other income subject income reported in Schedule A, line 1.
to the tax. However, an individual return is required from any partner having CORPORATE PARTNERS are taxed on their distributive share of the
taxable income other than his distributive share of the net profits of the partnership’s ordinary business income attributable to business activity in
partnership. (In such instances, a partner who is required to file an individual Walker, plus net rentals of tangible property in the City and gains from the
return should refer to the instructions for such return.) sale or exchange of tangible property in the City. Corporations are not taxed
Partnerships electing to pay the tax on behalf of the partners, assume the on: their share of net rentals of property located outside the City; or gains
status of a taxpayer to the extent that: (1) Timely payment must be made; from the sale or exchange of tangible property located outside the City.
(2) A 2022 Declaration of Estimated Income Tax, Form W-1120-ES, will be
required if the total 2022 estimated tax for the partnership is expected to PAGE 1 INSTRUCTIONS
exceed $100. The calendar or fiscal year of the partnership will govern in
COLUMN 1. The amounts to be inserted in column 1, page 1 are transferred
establishing the dates for filing the declaration and paying the estimated tax. from Schedule C on page 2 of the return. If this return is an information
Partnerships electing to become the taxpayer should start preparation of the return, the remaining columns, 2 through 6, on page 1 need not be
return on page 2 with Schedules A and B. If the partnership is subject to completed. However, if the partnership elects to pay the tax, columns 2
allocation of business income, Schedule D should be completed next. through 6 must be completed.
Schedule C is then completed to determine each partner’s share of business
and non-business income. Partnerships with rental real estate must complete COLUMN 2. Allowable individual partner deductions which relate to the
partnership are deducted in column 2. These deductions include net
Schedule E. Page 1 is to be totally completed. operating loss carryovers. This column is also used to adjust for a net capital
REMITTANCE: Partnerships electing to pay the tax for all partners must loss realized by any of the partners, in excess of the partner's maximum
remit the tax when filing the return. allowable ($3,000) capital loss deduction. Therefore, a net capital loss
realized by any of the partners, in excess of the partner's allowable capital
MAKE REMITTANCE PAYABLE TO: WALKER CITY TREASURER. loss deduction must be added back in column 2, page 1. The allowable
capital loss deduction for each partner is the lesser of (1) the net capital loss,
MAILING ADDRESS: (2) the amount in column 1, page 1, computed without regard to capital gains
WALKER INCOME TAX DEPARTMENT and losses, or (3) $3,000. Capital gains and losses, and net operating loss
P.O. BOX 153 carryovers are to be handled in the same manner as provided in the Federal
GRAND RAPIDS, MICHIGAN 49501-0153 Internal Revenue Code. Nonresident partners must allocate net operating
losses to Walker at the percentage of business conducted in Walker in the
year in which the loss was sustained. ATTACH A SCHEDULE DETAILING
COMPUTATION OF AMOUNTS REPORTED IN COLUMN 2.
PARTNERSHIP FILING AN INFORMATION RETURN
Partnerships filing information returns are required to complete: Page 2: COLUMN 3. A $600 exemption is allowed for each partner, the partner’s
spouse and dependents. Additional exemptions are allowed if the taxpayer or
Schedules A, B, C and if appropriate Schedules D and E; and Page 1: spouse is 65 or over or is blind. In general, the same rules apply in
Identification and Information Section and Column 1. determining dependents as under the Federal Internal Revenue Code. A
INCOME TAXABLE TO RESIDENT vs spouse may be taken as an exemption on the partnership return only if such
NONRESIDENT PARTNERS spouse has no income subject to Walker Income Tax. Exemptions for a
The Partnership Return, Form W-1065, is designed to distinguish between partner whose residence status has changed from a resident to a nonresident
that income taxed to residents and nonresidents. The purpose of the return is or from a nonresident to a resident of Walker during the taxable year are first
to set forth the entire net profit for the period covered and to show the applied against income while a resident with the balance, if any, applied to
distributive share of each partner, indicating those who are residents of Walker income while a nonresident. A partner’s personal and dependency
Walker and those who are nonresidents. (If residency changes during the exemptions may not be claimed on more than one partnership return.
taxable period for any partner, use two lines to indicate allocation of income Exemptions are not allowed to other persons who are partners (i.e.
by status in all schedules where applicable.) corporations who are partners, partnerships who are partners, etc.)
Ordinary business income of the partnership is reported in Schedule A. This Column 6. In column 6 enter payments made by the partnership: Tax paid
ordinary business income is transferred to Schedule C, column 1, by showing with a tentative return; Payments on a 2021 Declaration of Estimated Income
the amount of ordinary income distributable to each partner. Tax; or any credits for income taxes paid to any other municipality by the
partnership on behalf of Walker resident partners, if the income on which
INSTRUCTIONS PAGE 1
