UTAH
TC-20 Forms & Instructions
Corporation FranchiseCorporation Franchise
&& IncomeIncome TTaxax
Utah State Tax Commission • 210 North •1950 West Salt Lake•City,tax.utah.govUtah 84134
|
UTAH
TC-20 Forms & Instructions
Corporation FranchiseCorporation Franchise
&& IncomeIncome TTaxax
Utah State Tax Commission • 210 North •1950 West Salt Lake•City,tax.utah.govUtah 84134
|
|
Contents
General Instructions and Information .........................................................................................................................................................1
TC-20 – Utah Corporation Franchise and Income Tax Return ...................................................................................................................6
Schedule A – Utah Net Taxable Income and Tax Calculation .....................................................................................................................8
Schedule B – Additions to Unadjusted Income ........................................................................................................................................13
Schedule C – Subtractions from Unadjusted Income ......................................................................................................................................15
Schedule D – Utah Contributions Deduction ............................................................................................................................................17
Schedule E – Prepayments of Any Type...................................................................................................................................................17
Schedule H – Nonbusiness Income Net of Expenses ..............................................................................................................................18
Schedule J – Apportionment Schedule ....................................................................................................................................................20
Schedule M – Corporations Included in Combined Filings .......................................................................................................................24
TC-559, Corporation/Partnership Payment Coupon .................................................................................................................................25
Common Return Errors ............................................................................................................................................................................26
Cover art by Randolph Prawitt
File the Right Corporate Forms Utah Taxpayer Advocate Service
• TC-20 if Corporation fi led federal form 1120, 1120-IC-DISC The Taxpayer Advocate Service helps taxpayers who have made
• TC-20S if S Corporation fi led federal form 1120S multiple, unsuccessful attempts to resolve concerns with the Tax
Commission. This service helps resolve problems when normal
• TC-20MC if Corporation fi led federal forms 1120-H, 1120-RIC, agency processes break down, identifi es why problems occurred, and
1120-REIT, 990-T or 8023 suggests solutions. See tax.utah.gov/contact, or contact us to fi nd
out if you qualify for this service at 801-297-7562 or 1-800-662-4335,
E-Filing is Easier! ext. 7562, or by email at taxpayeradvocate@utah.gov.
E-fi ling is the easiest and most accurate way to fi le. Ask your tax Do not use the Taxpayer Advocate Service to bypass normal methods
preparer about e-fi ling your individual, fi duciary, partnership, C cor- for resolving issues or disputes.
poration and S corporation returns, or use commercial tax software.
Utah is Online Need more information?
Utah offers many online services for individual and business fi lers,
including: Questions 801-297-2200 or
1-800-662-4335 (outside the Salt Lake area)
tap.utah.gov
Research Utah rules, bulletins and Commission decisions:
• Pay by e-check or credit card. tax.utah.gov
• Manage your Utah tax account. Utah Code (UC): le.utah.gov
• Request payment plans. Internal Revenue Code (IRC):
tax.utah.gov law.cornell.edu/uscode/26
• Download forms and instructions for all Utah tax types.
• Link to free business resources and other services.
E-Verify for Employers If you need an accommodation under the Americans with Disabili-
Employers can help prevent identity theft by verifying the Social ties Act, email taxada@utah.gov, or call 801-297-3811 or TDD
Security numbers of job applicants. E-Verify is a free service of 801-297-2020. Please allow three working days for a response.
the U.S. Department of Homeland Security that verifi es employ-
ment eligibility through the Internet. Employers can use E-Verify at
uscis.gov/e-verify.
|
|
2021 Utah TC-20 Instructions 1
General Instructions and Information
What’s New Corporation Changes
• Solar Energy Systems Phase-out: The maximum Re- Report corporation changes (e.g., name change, physical and/
newable Residential Energy Systems Credit (credit 21) for or mailing address changes, merger, or ceasing to do business
solar power systems installed in 2021 is $1,200. in Utah) in writing to:
• Net Operating Loss Carryforwards: For tax years starting UT Division of Corporations and Commercial Code
on or after Jan. 1, 2021, Utah net losses carried forward Department of Commerce
from certain prior years may not exceed 80 percent of Utah 160 E 300 S, 2nd Floor
taxable income. See page 8. PO Box 146705
• Special Needs Opportunity Scholarship Program: The Salt Lake City, UT 84114-6705
2020 legislature passed HB 4003, creating a nonrefund- and submit form TC-69C to:
able tax credit for donations made to the Special Needs Exceptions Processing
Opportunity Scholarship Program. See page 10. Utah State Tax Commission
210 N 1950 W
• Payroll Protection Program Loan Addback: In certain
situations you must add to your income the amount of PPP Salt Lake City, UT 84134-3215
grants or loans forgiven in 2021. See page 14.
Dissolution or Withdrawal
Reminders Corporations that cease to do business in Utah must either
• Market Sourcing of Revenues from Performance of dissolve or withdraw the corporation.
Services by Multi-state Taxpayers: Corporations perform- Corporations incorporated in Utah must fi le Articles of Dissolution
ing a service both in and outside of Utah must calculate with the Department of Commerce.
the sales factor numerator on Schedule J by considering
Corporations incorporated outside of Utah (foreign corpora-
the service income to be in Utah if the buyer receives a
tions) must obtain a Certifi cate of Tax Clearance from the
greater benefi t of the service in Utah than in any other state.
Tax Commission before withdrawing from Utah. Foreign
See Schedule J – Apportionment Schedule on page 20.
corporations must fi le an Application for Withdrawal with the
• Foreign Operating Company Changes: A foreign operat- Department of Commerce.
ing company must have a minimum of at least $1,000,000
To request a Certifi cate of Tax Clearance, email the Tax
in payroll located outside the United States and at least
Commission at taxmaster@utah.gov, or call 801-297-2200
$2,000,000 in property located outside the United States.
or 1-800-662-4335. We will send you an Application for Tax
In addition, income generated from transactions between
Clearance to Withdraw a Foreign Corporation to complete
members of the unitary group, or from intangible property
and return.
or an asset held for investment does not qualify for the 50
percent foreign operating company income exclusion on Dissolving and withdrawing corporations must also close their
Schedule C. See pages 4 and 15. other Utah tax accounts (sales, withholding, etc.). To close
related tax accounts, send a completed TC-69C, Notice of
Change for a Business and/or Tax Account, to the attention of
Electronic Filing Exceptions Processing at the Tax Commission address above.
Utah corporation returns may be fi led electronically under a
joint program between the Internal Revenue Service and the
Utah State Tax Commission. Rounding Off to Whole Dollars
Round off cents to the nearest whole dollar. Round down if cents
The federal and state information is submitted at the same time
are under 50 cents; round up if cents are 50 cents and above. Do
and the IRS extracts its federal data and forwards the state
not enter cents on the return.
data to the Tax Commission. No papers need to be mailed to
the agencies when fi ling electronically.
Check with your software provider to see if they offer electronic Liability for Filing and Paying
corporation fi ling.
Tax Forms
Learn more about fi ling your corporation return electronically
at tax.utah.gov/developers/mef. The Tax Commission does not mail forms for fi ling corporate
taxes. Get forms at tax.utah.gov/forms or by calling the
Forms Hotline at 801-297-6700 or 1-800-662-4335, ext. 6700.
Identifi cation Numbers Note: See What to Attach and What to Keep later in these
The corporation's federal Employer Identifi cation Number General Instructions for what federal information is required
(EIN) is the Utah identifi cation number. The Utah Department with the Utah return.
of Commerce also issues a registration number upon incor-
poration or qualifi cation in Utah. Enter both the EIN and Utah Franchise Tax
Incorporation/Qualifi cation number in the proper fi elds. These Every C corporation incorporated in Utah (domestic), qualifi ed
numbers are used for identifi cation of the corporate tax return. in Utah (foreign), or doing business in Utah, whether qualifi ed
or not, must fi le a corporate franchise tax return. C corporation
|
|
2021 Utah TC-20 Instructions 2
returns are fi led on form TC-20. Every corporation that fi les Where to File
form TC-20 must pay a minimum tax (privilege tax) of $100,
regardless of whether or not the corporation exercises its right Mail your return to:
to do business. Utah State Tax Commission
210 N 1950 W
S Corporation Salt Lake City, UT 84134-0300
Every S corporation (as defi ned in IRC §1361(a)) that has
fi led a proper and timely election under IRC §1362(a) must Due Date
fi le form TC-20S, so long as the federal election remains in A return must be fi led on or before the 15th day of the fourth
effect. The minimum tax does not apply to S corporations. month following the close of the taxable year or the due date
of the federal return, whichever is later. If the due date falls on
Income Tax a Saturday, Sunday or legal holiday, the due date becomes
Corporate income tax fi lers use form TC-20. the next business day.
Corporations required to fi le under the income tax provisions Filing Extension
are those that derive income from Utah sources, but are not
qualifi ed to do business in Utah and have no regular and es- Corporations are automatically allowed an extension of up to
tablished place of business in Utah, either owned or rented, six months to fi le a return without fi ling an extension form. This
and do not maintain an inventory or have employees located is NOT an extension of time to pay your taxes – it is only
at a place of business in Utah. an extension of time to fi le your return. To avoid penalty,
the prepayment requirements must be met on or before the
original return due date, and the return must be fi led within the
Example 1: six-month extension period.
A trucking company, operated in or through Utah by
a foreign corporation not qualifi ed to do business in
Utah, is subject to income tax rather than franchise tax. Prepayment Requirements
Extension Prepayments
Extension prepayments must equal 90 percent of the cur-
Example 2: rent year’s tax liability (or the $100 minimum tax, whichever
is greater) or 100 percent of the previous year’s tax liability.
A lender issuing credit cards to Utah customers from The tax used to compute the 90 percent amount includes the
outside Utah that is not qualifi ed to do business in interest on installment sales and the recapture of low-income
Utah and has no place of business in Utah is subject housing credit on the return.
to income tax rather than franchise tax.
Use form TC-559, Corporation/Partnership Payment Coupon
to make the estimated prepayments.
A $100 minimum tax applies to the corporate income tax.
Quarterly Payments
Federal Form 1120-IC-DISC Every corporation having a Utah tax liability of $3,000 or more
If the corporation is fi ling a federal form 1120-IC-DISC and in the current taxable year, or a tax liability of $3,000 or more
is not owned 50 percent or more by another corporation, in the previous taxable year, must make quarterly estimated
none of its income is taxable to the corporation but must be tax payments. In addition, a parent company fi ling a combined
passed-through to the DISC corporation shareholders who report with affi liated companies must make the quarterly pay-
would report and pay tax on the distribution on their personal ment when the aggregate tax amount is $3,000 or more for all
or business tax returns. companies listed on Schedule M, including those paying only
the minimum tax.
Taxable Year A corporation does not need to make quarterly estimated tax
The taxable year for Utah tax purposes must match the tax- payments the fi rst year it fi les in Utah if it pays the minimum
able year used for federal tax purposes. When the taxable tax on or before the due date, without the extension.
year changes for federal purposes, the taxable year must be Quarterly estimated payments are due on the 15th day of the
changed for Utah purposes. See Filing Return When Period 4th, 6th, 9th and 12th months of the corporation’s taxable year,
Changed below. unless federal action changes the federal quarterly due dates.
Corporations may elect to make the quarterly estimated tax
Filing Return When Period Changed payments equal to 100 percent of the prior year’s tax in four
When changes are made to the taxable year, as indicated equal payments, or 90 percent of the current year’s tax based
under Taxable Year above, a short-period return is required. on the percentages below. As defi ned in UC §59-7-504(2), the
The short-period return must cover the period of less than applicable percentage of the required payment for annualized
12 months between the prior taxable year-end and the new income installments, for adjusted seasonal installments, and for
taxable year. The tax rates as provided in UC §§59-7-104 estimated tax payments based on the current year tax liability is:
and 59-7-201 apply to short-period returns, which includes a
minimum tax of $100.
|
|
2021 Utah TC-20 Instructions 3
Installment Percentage (in addition to penalties due)
Interest
1st 22.5 Interest is assessed on underpayments from the due date
2nd 45.0 until the liability is paid in full. The interest rate for the 2022
3rd 67.5 calendar year is 2 percent.
4th 90.0 For more information, get Pub 58, Utah Interest and Penalties,
at tax.utah.gov/forms.
If you use a different annualization period than the period
used for federal purposes, you must make an election with the
Tax Commission at the same time as provided in IRC §6655. Suspension for Failure to Pay
Make estimated tax payments with form TC-559, Corporation/ Tax Due
Partnership Payment Coupon.
Utah law provides for suspension of a corporation’s right to do
Corporations that do not make the required tax prepayments business in Utah if it fails to pay taxes due before 5:00 p.m.
are subject to a penalty. See Penalties, below. on the last day of the 11th month after the due date.
If you cannot pay the full amount you owe, you can request a
Penalties payment plan. Log into your corporate account at tap.utah.gov
Utah law (UC §59-1-401) provides penalties for not fi ling tax and click "Request waiver, payment plan or payment plan
returns by the due date, not paying tax due on time, not mak- email."
ing suffi cient prepayment on extension returns, and not fi ling You may also:
information returns or supporting schedules. See tax.utah. 1. complete form TC-804B, Business Tax Payment Agreement
gov/billing/penalties-interest and Pub 58, Utah Interest and Request (tax.utah.gov/forms), or
Penalties, at tax.utah.gov/forms.
2. call the Tax Commission at 801-297-7703 or 1-800-662-4335
The Tax Commission will calculate the penalty for underpay- ext. 7703.
ment of required prepayments.
Exceptions to Penalty on What to Attach and What to Keep
Estimated Tax Include the following with your Utah TC-20. Also, keep copies
of these with your tax records.
Annualized Exception
• Utah Corporation Return Schedules: Attach applicable
A corporation may annualize its income before determining Utah schedules A, B, C, D, E, H, J, and/or M.
the amount of each estimated tax installment. Follow federal
guidelines to determine annualized income. If the corporation • Federal Return: Attach only pages 1 through 6 of your
meets the annualized exception at the federal level for any federal corporation return, plus Schedule M-3 and IRS
installment, check the appropriate box(es) on form TC-20, form 1125-A, if applicable.
line 15. Do not send a copy of your entire federal return, credit
schedules, worksheets, or other documentation with your
Recurring Seasonal Exception Utah return unless otherwise stated in these instructions.
A corporation with recurring seasonal income may annualize Keep these in your fi les. We may ask you to provide them later
its income before determining the amount of each estimated to verify entries on your Utah return.
tax installment. Follow federal guidelines to determine seasonal
income. If the corporation meets the seasonal exception at the
federal level for any installment, check the appropriate box(es) Combined Reports
on form TC-20, line 15. Any corporation owned by another corporation, or owning more
than 50 percent of another corporation, or a group of corpora-
Prepayment of Minimum Tax tions related through common ownership (i.e., certain brother/
Corporations that meet the prepayment requirement in the sister corporations) and engaged in unitary business activity,
current year and had a tax liability of $100 (the minimum must fi le a combined report showing the combined income of
tax) for the previous year may choose to prepay the $100 all such corporations.
minimum tax on the 15th day of the 12th month instead of A captive real estate investment trust must be included as
four payments of $25. a member of a unitary group. A real estate investment trust
Corporations that met the prepayment requirement in the (REIT) is a captive real estate investment trust if the shares
previous year and have a tax liability of $100 (the minimum or benefi cial interests of the REIT are not regularly traded on
tax) in the current year may choose to prepay the minimum an established securities market and more than 50 percent of
tax amount of $100 on the 15th day of the 12th month instead the voting power or value of the shares or benefi cial interests
of four payments of $25. In this case, the corporation must of the REIT are directly, indirectly, or constructively owned or
pay $100, not 90 percent. controlled by a controlling entity of the REIT.
Unitary Business
A unitary business exists if the activities of the corporations
(subsidiary or affi liated corporations related through common
|
|
2021 Utah TC-20 Instructions 4
ownership) are economically interdependent as demonstrated Corporations electing to fi le a worldwide combined report may
by the following factors: not later elect to fi le a return on a basis other than a worldwide
• Strong centralized management combined report without the consent of the Tax Commission.
• Functional integration Threshold Level of Business Activity
• Attainment of operational economies of scale Foreign corporations that conduct 20 percent or more of their
business activity in the United States, as measured by the
Instructions for Combining Captive Real average of the property and payroll factors, must be included
Estate Investment Trusts 100 percent in a water’s edge combined report. Any business
The income and factors for a captive real estate investment activity in Utah will subject a foreign corporation to Utah fran-
trust are included in a manner similar to other unitary corpo- chise tax. The combined reporting threshold test determines
rations in the combined group. Utah statutes include taxable whether the foreign corporation is a member of a unitary group.
income from federal form 1120-REIT before the net operating
loss deduction and the deduction for dividends paid. A Utah Foreign Dividends
deduction is allowed for the IRC §857(b)(2)(E) deduction. A Fifty percent of unitary foreign dividends are included in
subtraction is also allowed for dividends received from a cap- adjusted income. The remaining 50 percent, less certain
tive real estate investment trust by a member of the unitary expenses, are excluded. (See UC §59-7-106(1)(k) and (3).)
group. This subtraction is essentially an intercompany elimina- A portion of the property, payroll and sales of each dividend
tion since the 1120-REIT taxable income is included before paying subsidiary is allowed to be included in the combined
the federal dividends paid deduction. apportionment denominators at the ratio the amount of the
The property, payroll and sales of a REIT are included in the dividend included in Utah combined income bears to the total
factors of the combined group to the extent otherwise provided earnings and profi ts for each dividend paying company.
in Utah laws and rules. Intercompany transactions between a
captive REIT and any member of the unitary group must be Preparation of Combined Report(s)
removed from the sales factor. Similarly, intercompany rents A group fi ling a combined report will calculate adjusted income
must be removed from the combined property factor. of the combined group by:
1. determining which corporations are unitary;
Water’s Edge Combined Report
2. computing unadjusted income on a separate return basis;
A unitary group must fi le on a water’s edge basis unless the
worldwide combination method has been elected. A water’s edge 3. combining income or loss of the members included in the
combined report includes the income and activities of all members combined report;
of a unitary group that are: 4. making appropriate eliminations and adjustments between
• corporations organized or incorporated in the United States, members included in the combined report to arrive at
including those corporations qualifying for the Puerto Rico unadjusted income on a combined basis; and
and Possession Tax Credit as provided in IRC §936; and 5. making additions and subtractions to unadjusted income
• corporations organized or incorporated outside of the United as outlined in Schedules B, C and D to arrive at adjusted
States meeting the threshold level of business activity. income.
Corporations that fi le either a water’s edge or worldwide com-
Water’s Edge Election bined report must eliminate all intercompany sales or other
A group of corporations that are not otherwise a unitary intercompany transactions between corporations included in
group may elect to fi le a water’s edge combined report under the combined report in determining the sales factor on TC-20,
UC §59-7-402(2) if each member of the group is: Schedule J. Similarly, corporations fi ling a Utah combined re-
port may not include intercompany rents or other intercompany
• doing business in Utah,
transactions between those corporations in determining the
• part of the same affi liated group, and property factor. See UC §59-7-404.5.
• qualifi ed under IRC §1501 to fi le a federal consolidated A unitary group of corporations is considered a single taxpayer
return. for purposes of the assignment of sales in the sales factor of
Each corporation within the affi liated group doing business in the apportionment calculation. Therefore, sales of tangible
Utah must consent to fi ling the combined report. If an affi liated personal property by any member of the unitary group de-
group elects to fi le a combined report, each corporation within livered or shipped into Utah are includable in the Utah sales
the affi liated group doing business in Utah must be included numerator. Conversely, such sales originating in Utah, which
in the combined report. are delivered or shipped to another state, will not be included
in the Utah sales numerator if any member of the unitary
Corporations that elect to fi le a water’s edge combined report group has a taxable presence (nexus) in that state. See Tax
under this section may not thereafter elect to fi le a separate return Commission Rule R865-6F-24.
without the consent of the Tax Commission.
Worldwide IRC Sections 338, 338(h)(10)
A unitary group may elect to fi le a worldwide combined report. and 336(e)
When the worldwide combined reporting method is elected,
the income or loss of each corporation within the unitary You must complete your Utah return in a manner consistent
group must be included regardless of the country in which the with the election you make under IRC §§338, 338(h)(10) and
corporations are incorporated or conduct business. 336(e).
|
|
2021 Utah TC-20 Instructions 5
IRC Section 338 IRC Section 336(e)
If a federal election is made under IRC §338, the target If an election is made under IRC §336(e), the transaction must
corporation must fi le a separate entity one-day tax return for be treated as follows:
Utah purposes, as required for federal purposes. The target 1. If the corporation is treated for federal purposes as having
corporation must include the gain or loss on the deemed disposed of all of its assets and is a member of a unitary
sale of assets in its adjusted income. See UC §59-7-114 for group immediately preceding the date of sale, the corpora-
further details. tion must be included in a combined return to the extent
Get form TC-20MC, Utah Tax Return for Miscellaneous Cor- of its income through the date of sale. The gain or loss on
porations, at tax.utah.gov/forms. the deemed disposal of assets is included in the combined
income of the unitary group.
IRC Section 338(h)(10) 2. If the corporation is treated for federal purposes as hav-
If an election is made for federal purposes under ing disposed of all of its assets and is not a member of a
IRC §338(h)(10), the following apply: unitary group immediately preceding the date of sale, the
1. If the target corporation is a member of a unitary group corporation must fi le a short-period return for the period
immediately preceding the acquisition date, the target ending on the date of sale and must include the gain or loss
corporation must be included in a combined report to the on the deemed disposal of assets in its adjusted income.
extent of its income through the acquisition date. The gain 3. Any gain or loss not recognized for federal purposes on
or loss on the deemed sale of assets is included in the stock sold, exchanged or distributed by a corporation
combined income of the unitary group. pursuant to IRC §336(e) may not be included in adjusted
2. If the target corporation is not a member of a unitary group income.
immediately preceding the acquisition date, the target 4. The new basis of assets of the corporation treated as
corporation must fi le a short-period return for the period having disposed of its assets is the same as determined
ending on the acquisition date and must include the gain or for federal purposes.
loss on the deemed sale of assets in its adjusted income. 5. The corporation treated as having disposed of its assets is
3. Any gain or loss on stock sold or exchanged by a member treated as a new corporation as of the day after the date
of a selling consolidated group (as defi ned in IRC §338) of sale.
which is not recognized for federal purposes may not be
included in the adjusted income of the selling corporation.
Installment Sales
4. The target corporation is treated as a new corporation as
of the day after the acquisition date. If a corporation is no longer required to fi le a Utah corporate
return, any taxes owed by that corporation on installment sales
entered into by that corporation shall accelerate and be due
on the corporation’s last return fi led in Utah.
|
|
2021 Utah TC-20 Instructions 6
TC-20 – Utah Corporation Franchise and Income
Tax Return
Filing Period Reason-for-Amending Codes
File the 2021 return for calendar year 2021 and fi scal years 1 You fi led an amended federal return with the IRS. Attach
beginning in 2021 and ending in 2022. If the return is for a a copy of your amended federal return.
fi scal year or a short tax year (less than 12 months), fi ll in the 2 You made an error on your Utah return. Attach an explana-
tax year beginning and end dates at the top of the form using tion of the error.
the format mm/dd/yyyy. 3 Your federal return was changed by an IRS audit or adjust-
ment that affects your Utah return. Attach a copy of the
Corporation Name & Address IRS adjustment.
Enter the corporation name, address and telephone number, 4 Other. Attach an explanation to your return.
including area code. If the address has changed, see Corpora- Enter the corrected fi gures on the return and/or schedule.
tion Changes in the General Instructions. Enter all other amounts as shown on your original return. If
you received a refund on your original return, subtract the
Zip Code previous refund (exclude refund interest) from the amount of
Enter your ZIP Code, including the “plus four” at the end, any tax paid with the original return and/or subsequent pay-
without a hyphen. ments of the tax prior to fi ling the amended return. Enter the
net amount on Schedule A, page 2, line 30. Enter a net refund
as a negative amount (preceded by a minus sign).
Foreign Country
If your address is in a foreign country, enter the mailing ad-
dress where indicated. Enter the foreign city, state/province Federal Form 8886
and postal code in the City fi eld. Abbreviate if necessary. Leave If you fi led federal form 8886, Reportable Transactions Disclo-
the State and ZIP Code fi elds blank. Enter only the foreign sure Statement, with the Internal Revenue Service, enter an
country name in the “Foreign country” fi eld. “X” at the top of TC-20, where indicated.
EIN and Utah Incorporation/ Line-by-Line Instructions
Qualifi cation Number
Line 1
Enter your Federal Employer Identifi cation Number (EIN)
and Utah Incorporation/Qualifi cation Number issued by the Enter an “X” on line 1 if this corporation conducted business
Department of Commerce in the appropriate fi elds. in Utah during the taxable year.
Line 2
Amended Returns Enter an “X” on line 2 if the federal form 1120 fi led for the
Do not submit a copy of your original return with your same tax period was a consolidated return.
amended return.
Line 3
To amend a previously fi led return, use the tax forms and in-
structions for the year you are amending. Get prior year forms Enter an “X” to indicate whether the return is:
and instructions at tax.utah.gov/forms-pubs/previousyears. a. A water’s edge combined report, or
Amend your return if: b. A water’s edge election made under UC §59-7-402(2), or
• you discover an error on your Utah or federal return after c. A worldwide combined report.
it has been fi led, or See Combined Reports in the General Instructions for infor-
• your federal return is audited or adjusted by the IRS and mation on the proper fi ling method.
the audit or adjustment affects your Utah return. You must
amend your Utah return within 90 days of the IRS’s fi nal Line 4
determination. Enter an “X” if an election has been made under IRC §§338,
To qualify for a refund or credit, an amended return must be 338(h)(10) or 336(e). See IRC §§338, 338(h)(10) and 336(e)
fi led by the later of three years after the original return was in the General Instructions for information regarding these
due or two years from the date the tax was paid. A return elections.
fi led before the due date is considered fi led on the due date.
Line 5
To amend a previously fi led return, at the top of page 1, on
the “Amended Return” line, enter the code number from the Enter an “X” on line 5 if this corporation is, or includes, a fi nan-
following list that best describes your Reason for Amending: cial institution as defi ned in Tax Commission Rule R865-6F-32.
|
|
2021 Utah TC-20 Instructions 7
Line 6 This authorization applies only to the individual whose signa-
ture appears in the Paid Preparer's Section of the return. It
Enter the ultimate U.S. parent corporation’s name and federal does not apply to the fi rm, if any, shown in that section. If you
employer identifi cation number. enter an “X” in the box, the corporation is authorizing the Tax
Commission to call the paid preparer to answer any questions
Line 7 – Total Tax
that may arise during the processing of the return. The paid
Enter the total tax from Schedule A, page 2, line 27. preparer is also authorized to:
Line 8 – Total Refundable Credits and • give the Tax Commission any information that is missing
from the return;
Prepayments
• call the Tax Commission for information about the process-
Enter the total refundable credits and prepayments from ing of the return or the status of any refund or payment(s);
Schedule A, page 2, line 31. and
Line 9 – Tax Due • respond to certain Tax Commission notices about math
errors, offsets and return preparation.
If line 7 is larger than line 8, subtract line 8 from line 7.
The corporation is not authorizing the preparer to receive any
Line 10 – Penalties and Interest refund, bind the entity to anything (including any additional
Enter any penalties and interest that apply to this return. See tax liability), or otherwise represent the entity before the Tax
Pub 58, Utah Interest and Penalties. Commission. The authorization will automatically end no later
than the due date (without regard to extensions) for fi ling next
Line 11 – Total Due - Pay This Amount year's tax return.
Add lines 9 and 10. Pay at tap.utah.gov, or send a check If you want to expand the preparer’s authorization, complete
or money order with your return (make payable to the Utah and submit form TC-737, Power of Attorney and Declaration
State Tax Commission). Do not mail cash. The Tax Commis- of Representative (tax.utah.gov/forms). If you want to revoke
sion assumes no liability for loss of cash placed in the mail. the authorization before it ends, submit your request in writ-
ing to the Utah State Tax Commission, attention Taxpayer
Line 12 – Overpayment Services, 210 N 1950 W, SLC, UT 84134.
If line 8 is larger than the sum of line 7 and line 10, subtract the
sum of line 7 and line 10 from line 8. Paid Preparer
The paid preparer must enter his or her name, address and
Line 13 – Amount of Overpayment to be Applied PTIN in the section below the corporate offi cer’s signature
to Next Taxable Year on the return.
All or part of any overpayment shown on line 12 may be applied
as an advance payment for the next tax year. Enter the amount Preparer Penalties
(UC §59-1-401(11)-(12))
to be applied (may not exceed the overpayment on line 12).
The person who prepares, presents, procures, advises, aids,
Line 14 – Refund assists or counsels another on a return, affi davit, claim or
Subtract line 13 from line 12. This is the amount to be re- similar document administered by the Tax Commission, and
funded to you. who knows or has reason to believe it may understate a tax,
fee or charge is subject to both a civil penalty ($500 per docu-
Line 15 – Quarterly Estimated Prepayments ment) and criminal penalties (second degree felony with a fi ne
Meeting Exception from $1,500 to $25,000).
Check any boxes corresponding to the four quarters to which
a federal penalty exception applies. See Prepayment Require- Supplemental Information to be
ments in the General Instructions for exceptions to the penalty
Supplied by All Corporations
on underpayments. Attach supporting documentation.
All corporations must complete the information on page 2 of
the TC-20.
Signature and Date Lines
Sign and date the return. We will not issue a refund without
a signature.
Paid Preparer Authorization
If the corporation wants to allow the Tax Commission to discuss
this return with the paid preparer who signed it, enter an “X”
in the box on the right-hand side of the signature area of the
return where indicated.
|
|
2021 Utah TC-20 Instructions 8
Schedule A – Utah Net Taxable Income and Tax
Calculation
Line 1 – Unadjusted Income (Loss) Line 13 – Apportioned Income (Loss)
Enter the federal taxable income from line 28 of your federal Multiply the apportionable income on line 11 by the apportion-
form 1120. ment fraction on line 12.
If any member of the unitary group is a “controlling entity of a
Line 14 – Utah Net Nonbusiness Income
captive real estate investment trust,” include taxable income
from line 20 of each federal form 1120-REIT on this line. A Enter the amount from line 6, above.
“controlling entity of a captive real estate investment trust” is
an entity that: Line 15 – Utah Income (Loss) Before Utah Net
1. is treated as an association taxable as a corporation under Loss Deduction
the Internal Revenue Code; Add line 13 and line 14.
2. is not exempt from federal income tax under IRC §501(a);
Line 16 – Utah Net Loss Carried Forward from
and
Prior Years
3. directly, indirectly or constructively holds more than 50
percent of the voting power or value of shares or benefi cial Enter Utah net losses carried forward from prior years.
interests of a captive real estate investment trust. Losses carried forward from tax years that began after Jan.
1, 2018 (2018 and later) may not exceed 80 percent of your
Line 2 – Additions to Unadjusted Income Utah taxable income on line 15. There is no income limitation
Enter the total additions from Schedule B, line 19. for losses carried forward from tax years that began BEFORE
Jan. 1, 2018 (2017 and earlier).
Line 3 – Add line 1 and line 2 If you are carrying forward losses from tax years that began
Line 4 – Subtractions from Unadjusted Income both before AND after Jan. 1, 2018, use the Line 16 Work-
sheet, below, to calculate the amount you may claim this year.
Enter the total subtractions from Schedule C, line 21.
Attach documentation to the return to support the losses.
Line 5 – Adjusted Income (Loss)
Subtract line 4 from line 3. Line 16 Worksheet
Use this worksheet if you have losses from tax years both before
Line 6 – Utah Net Nonbusiness Income and after Dec. 31, 2017.
Enter the nonbusiness income allocated to Utah from Sched- 1. Current-year Utah income 1_______
ule H, line 14. (enter the amount from Schedule A, line 15)
2. 80% of taxable income 2_______
Line 7 – Non-Utah Net Nonbusiness Income (multiply line 1 by 0.8)
Enter the nonbusiness income allocated outside Utah from 3. Losses from 2017 and earlier 3_______
Schedule H, line 28.
4. Available losses from 2017 and earlier 4 _______
Line 8 – Total Nonbusiness Income (enter the lesser of line 1 and line 3)
Add line 6 and line 7. 5. Taxable income after 2017 and earlier losses 5 _______
(line 1 minus line 4)
Line 9 – Apportionable Income (Loss) 6. Losses from 2018 and later 6_______
Before Contributions Deduction 7. Available losses from 2018 and later 7_______
Subtract line 8 from line 5. (enter the lesser of line 2, line 5 and line 6)
8. Total available losses 8 _______
Line 10 – Utah Contributions Deduction (add line 4 and line 7)
Enter the amount of Utah contributions allowable for the tax- Enter line 8 on Schedule A, line 16.
able year from Schedule D, line 6. Attach a copy of this worksheet to your return.
Line 11 – Apportionable Income (Loss)
Subtract line 10 from line 9. Line 17 – Net Utah Taxable Income (Loss)
Line 12 – Apportionment Fraction (Decimal) Subtract line 16 from line 15.
Enter 1.000000, or the fraction (decimal) from Schedule J, Line 18 – Tax Amount
line 9 or 10, if applicable.
Enter the greater of line 18a or line 18b.
|
|
2021 Utah TC-20 Instructions 9
Line 18a Line 24 – Nonrefundable Credits
Multiply line 17 by 4.95% (.0495). Do not enter an amount Nonrefundable credits cannot be used to pay the minimum
less than zero. tax and cannot result in a refund.
If you claim any of the following nonrefundable credits, write
Line 18b
the code and amount of each credit you claim on lines 24a
Enter the total minimum tax from Schedule M, line b. If Sched- through 24f. Enter the sum of all nonrefundable credits on line
ule M does not apply, enter $100. 24. An explanation of each nonrefundable credit is listed below.
Line 19 – Interest on Installment Sales Use these codes for lines 24a through 24f
Generally, interest must be paid on the deferred tax related to 05 Carryforward of Clean Fuel Vehicle Credit
installment sales if the contract was entered into on or after 06 Historic Preservation Credit
Jan. 1, 1994. 08 Low-income Housing Credit
12 Credit for Increasing Research Activities in Utah
The interest rate must be determined according to IRC §453A. 13 Carryforward Credit for Machinery and Equipment
Enter the interest as an additional tax on Schedule A, line 19. Used to Conduct Research
The deferred tax liability for Utah purposes must be calculated 15 Utah Municipal, U.S. and Agency Bond Interest
in a manner similar to that outlined in IRC §453A(c), except: Credit
21 Renewable Residential Energy Systems Credit
1. The tax rate applied must be 4.95 percent; and AF Guarantee Association Assessment Credit
2. In the case of multi-state corporations, the amount of Utah AG Special Needs Opportunity Scholarship
gain that has not been recognized must be determined by Program Credit
multiplying the deferred gain that has not been recognized
for federal purposes by the current year apportionment
fraction. (05) Carryforward of Clean Fuel Vehicle Credit
(UC §59-7-605)
Line 20 – Current Year IRC §965(a) Installment The clean fuel vehicle credit is no longer available. The fi ve-
Amount year carryforward remains for credit earned before 2017. If you
If you were liable for Utah tax on deferred foreign income de- have unused credit from a year prior to 2017, you may carry
scribed in IRC §965(a) and you chose to pay the tax in eight it forward through tax year 2021 or until the credit is used up
yearly installments, enter the current-year installment amount (whichever comes fi rst). The carryforward must not be more
on line 20. The installment is a percentage of the total Utah than your tax liability in the year you claim it.
tax due, as reported on line 17 of form TC-20R. (06) Historic Preservation Credit (UC §59-7-609)
Installment Table Complete form TC-40H, Historic Preservation Tax Credit with
First installment: 8% (paid with TC-20R) the State Historic Preservation Offi ce certifi cation verifying the
credit is approved. Do not send form TC-40H with your return.
Second Installment: 8% Keep this form and all related documents with your records
Third installment: 8% to provide the Tax Commission upon request.
Fourth installment: 8%
The credit is for restoration costs of any residential certifi ed
Fifth installment: 8% historic building. Unused credits may be carried forward fi ve
Sixth installment: 15% years as a credit against Utah tax due.
Seventh installment: 20% For more information, contact:
Eighth installment: 25% Utah Division of State History
3760 S Highland Drive
Line 21 – Recapture of Low-Income Salt Lake City, UT 84106
Housing Credit 801-245-7277
Owners of a low-income housing project and other taxpayers history.utah.gov/shpo/fi nancial-incentives/
who have taken the low-income housing credit and disposed
of the building or an ownership interest may be required to (08) Low-Income Housing Credit
recapture any credits that reduced their tax liability in a pre- (UC §59-7-607)
vious year. See Utah form TC-40LIC (tax.utah.gov/forms) This credit is determined by the Utah Housing Corporation for
for instructions on calculating the low-income housing credit owners of a low-income housing project who also received part
recapture tax. Attach a supporting schedule showing the of the federal low-income housing credit. When this credit ap-
calculation of the credit recaptured. plies, the project owner will provide you with form TC-40TCAC
(issued by the Utah Housing Corporation).
Line 22 – Total Tax
If you share in this credit, get form TC-40TCAC, Utah Low-
Add the amounts on lines 18, 19, 20 and 21. Carry this total Income Housing Tax Credit Allocation Certifi cation, and com-
to Schedule A, page 2, line 23. plete form TC-40LI, Summary of Utah Low-Income Housing
Tax Credit. Do not send these forms with your return. Keep
Line 23 the forms and all related documents with your records.
Enter the total tax from Schedule A, page 1, line 22. The building project owner must also complete and attach to
his/her return form TC-40LIS, Utah Credit Share Summary
of Low-Income Housing Project.
|
|
2021 Utah TC-20 Instructions 10
Note: Any credit that is more than the tax liability may be car- (21) Renewable Residential Energy Systems Credit
ried back for the previous three years, or carried forward for (UC §59-7-614)
fi ve years. If you are carrying this credit forward or backward,
This credit is for reasonable costs, including installation, of a
you must also complete form TC-40LIC, Utah Low-Income
residential energy system that supplies energy to a residential
Housing Tax Credit Carryback and/or Carryforward.
unit in Utah. If the residence is sold to a non-business entity
If the low-income housing credit was claimed and the building before claiming the credit, you may irrevocably transfer the right
or ownership interest was subsequently disposed of, recapture to the credit to the new owner. Additional residential energy
of the credit may be required. See Recapture of Low-Income systems or parts may be claimed in following years as long as
Housing Credit on page 9. the total amount claimed does not exceed certain limits. Contact
For more information, contact: the Governor’s Offi ce of Energy Development for more informa-
Utah Housing Corporation tion. The principal portion of the lease payments may qualify for
2479 S Lake Park Blvd. the credit if the lessor irrevocably elects not to claim the credit.
West Valley City, UT 84120 Note: Any credit that is more than the tax liability may be
801-902-8200 carried forward for the next four years.
utahhousingcorp.org Get form TC-40E, Renewable Residential and Commercial En-
(12) Credit for Increasing Research Activities in Utah ergy Systems Tax Credits, from the Governor's Offi ce of Energy
(UC §59-7-612) Development with their certifi cation stamp showing the amount
of the credit. Do not send form TC-40E with your return. Keep
The credit is: the form and all related documents with your records to provide
1. 5 percent of your qualifi ed expenses for increasing research the Tax Commission upon request.
activities in Utah above a base amount, For more information, contact:
2. 5 percent of certain payments made to a qualifi ed orga- Governor's Offi ce of Energy Development (OED)
nization increasing basic research in Utah above a base PO Box 144845
amount, and Salt Lake City, UT 84114
3. 7.5 percent of your qualifi ed research expenses in Utah 801-538-8732 or 801-538-8702
for the current taxable year. energy.utah.gov/renewable-energy-
systems-tax-credit
Note: Any credit for 1 or 2 above that is more than the tax
liability may be carried forward for the next 14 taxable years. (AF) Guarantee Association Assessment Credit
Any credit for 3 above may not be carried forward. (UC §59-7-623)
There is no form for this credit. Keep all related documents An insurer that is not subject to the premium tax on health
with your records. care insurance may claim a nonrefundable tax credit equal to
20 percent of a guaranty association assessment payment for
(13) Carryforward of Prior Year Credit for Machinery
each of the fi ve years following the assessment.
and Equipment Used to Conduct Research
(UC §59-7-613) Note: Any credit that is more than the tax liability may be
carried forward.
This credit expired for taxable years beginning after 2010.
If you claimed a credit on your return for machinery and/or (AG) Special Needs Opportunity Scholarship
equipment used to conduct research for a year after 1998 and Program Credit
prior to 2011 and the credit was more than the tax liability for (UC §59-7-625)
the year, you may carry forward the excess credit to the next You may claim a credit for a donation made to the Special
14 years and use it to offset tax until used up. If you are using Needs Opportunity Scholarship Program. You will receive a
any remaining credit this year, enter that carryforward amount tax credit certifi cate from the program, listing the amount of
on Schedule A, page 2, line 24 (24a through 24f). Use code 13. the credit. You may not claim this credit if you claimed the
donation as an itemized deduction on your federal return.
(15) Utah Municipal, U.S. and Agency Bond Interest
Credit (UC §59-7-601) Do not send the certifi cate with your return. Keep the certifi cate
and all related documents with your records.
You may claim a credit of 1 percent of Utah municipal inter-
est and federal interest included in Utah taxable income. For Warning: If you take this credit, do not also subtract it as a
multi-state corporations, the amount of Utah municipal and charitable contribution on TC-20 Schedule D.
federal interest included in Utah taxable income is calculated Note: You may carry forward for the next three years any credit
by multiplying the total amount of that interest by the current that is more than your tax liability.
year apportionment fraction.
Attach a schedule showing the calculation of the credit. Keep Line 25 – Net Tax
a copy of the schedule and all related documents with your Subtract line 24 from line 23. Enter the result, but not less
records. than the minimum tax shown on line 18b or less than zero.
Note: Any credit that is more than the tax liability may be
carried back to the previous three years, or carried forward
for fi ve years.
|
|
2021 Utah TC-20 Instructions 11
Line 26 – Utah Use Tax
Use tax is a tax on goods and taxable services purchased for use,
Use Tax Rate Chart (Effective Dec. 31, 2021)
storage or other consumption in Utah. Use tax applies only if sales
tax was not paid at the time of purchase. If you purchased an item .0635 Beaver County .0635 Rich County
from an out-of-state seller (including Internet, catalog, radio and .0735 Beaver City .0795 Garden City
.0610 Box Elder County .0725 Salt Lake County
TV purchases) and the seller did not collect sales tax on that pur- .0665 Brigham City, Perry, .0875 Alta
chase, you must pay the use tax directly to the Tax Commission. Willard .0835 Brighton
.0640 Mantua .0745 Murray, South Salt
If you have a Utah sales tax license/account, report the use tax on .0710 Snowville Lake
your sales tax return. If you do not have a Utah sales tax license/ .0670 Cache County .0775 Salt Lake City
account, report the use tax on line 26 of TC-20, Schedule A. .0695 Cache Valley Transit, .0635 San Juan County
Hyde Park, Lewiston, .0675 Blanding, Monticello
You may take a credit for sales or use tax paid to another state Millville .0745 Bluff
(but not a foreign country). If the other state’s tax rate is lower than .0700 Hyrum, Logan, .0635 Sanpete County
Nibley, N. Logan,
Utah’s, you must pay the difference. If the other state’s tax rate Providence, Rich- .0645 Centerfi eld, Mayfi eld
is more than Utah’s, no credit or refund is given. If sales tax was mond, River Heights, .0675 Ephraim, Fairview,
paid to more than one state, complete the Use Tax Worksheet Smithfi eld Gunnison
.0635 Carbon County .0665 Mt. Pleasant
below for each state. Add lines 8 on all worksheets and enter the .0645 Helper .0635 Sevier County
total on line 26. .0675 Price .0645 Aurora, Redmond
.0665 Wellington .0675 Richfi eld, Salina
Sales and use tax rates vary throughout Utah. Use the Use .0735 Daggett County .0715 Summit County
Tax Rate Chart below to get the rate for the location where .0845 Dutch John .0905 Mil. Rec. Park City, Park
the merchandise was delivered, stored, used or consumed. .0715 Davis County City
Use the county tax rate if the city is not listed. .0725 Bountiful, Centerville, .0745 Snyderville Basin
Clearfi eld, Farming- Transit
Grocery food bought through the Internet or catalog is taxed ton, Layton, N. Salt .0660 Tooele County
at 3 percent. The grocery food must be sold for ingestion or Lake, Syracuse, W. .0690 Erda, Grantsville,
Bountiful, Woods Lakepoint, Lincoln,
chewing by humans and consumed for the substance’s taste Cross Stansbury Park
or nutritional value. The reduced rate does not apply to alco- .0635 Duchesne County .0700 Tooele City
holic beverages or tobacco. See Pub 25, Sales and Use Tax, .0645 Duchesne City .0645 Uintah County
.0675 Roosevelt .0695 Naples, Vernal
at tax.utah.gov/forms. .0635 Emery County .0715 Utah County
.0825 Green River .0725 American Fork, Cedar
.0710 Garfi eld County Hills, Lindon, Orem,
Use Tax Worksheet .0810 Boulder, Panguitch, Payson, Pleasant
1. Amount of purchases (except grocery food) Tropic Grove, Provo, Santa-
quin, Spanish Fork,
subject to use tax 1 _________ .0830 Bryce Canyon Vineyard
.0820 Escalante .0610 Wasatch County
2. Use tax rate .0685 Grand County .0640 Heber
(decimal from Use Tax Rate Chart) 2 .__ __ __ __ .0885 Moab .0720 Independence
.0610 Iron County .0750 Midway
3. Multiply line 1 by line 2 3 _________ .0810 Brian Head .0800 Park City East
4. Amount of grocery food purchases .0620 Cedar City .0645 Washington County
subject to use tax 4 _________ .0610 Juab County .0675 Hurricane, Ivins, La
.0650 Nephi Verkin, St. George,
5. Multiply line 4 by 3% (.03) 5 _________ .0635 Santaquin South Santa Clara, Washing-
.0710 Kane County ton City
6. Add line 3 and line 5 6 _________ .0820 Kanab .0805 Springdale
7. Credit for sales tax paid to another state .0810 Orderville .0745 Virgin
on use tax purchases 7 _________ .0635 Millard County .0610 Wayne County
.0645 Fillmore .0725 Weber County
8. Use tax due (subtract line 7 from line 6) 8 _________ .0620 Morgan County .0745 Falcon Hill Riverdale,
(If less than zero, enter "0.") .0645 Morgan City Riverdale
.0610 Piute County
Line 27 – Total Tax
Add line 25 and line 26. Carry this amount to TC-20, page
1, line 7.
Line 28 – Refundable Credits
Add lines 28a through 28d.
Claim any of the following refundable credits that apply. Write
the code and amount of each credit you are claiming on lines
28a through 28d. Enter the sum of these credits on line 28.
Each refundable credit is explained below.
|
|
2021 Utah TC-20 Instructions 12
(47) Agricultural Off-Highway Gas/Undyed Diesel Fuel
Codes for lines 28a through 28d Credit (UC §59-13-202)
39 Renewable Commercial Energy Systems Credit
43 Pass-through Entity Withholding Tax Credit You may claim a credit of 31.4 cents per gallon for motor fuel
46 Mineral Production Withholding Tax Credit and undyed diesel fuel bought in Utah during 2021 and used
47 Agricultural Off-highway Gas/Undyed Diesel Fuel to operate stationary farm engines and self-propelled farm
Credit machinery used solely for commercial non-highway agricul-
48 Farm Operation Hand Tools Credit tural use if the fuel was taxed at the time it was bought.
This does not include golf courses, horse racing, boat opera-
(39) Renewable Commercial Energy Systems Credit tions, highway seeding, vehicles registered for highway use,
(UC §59-7-614) hobbies, personal farming and other non-agricultural use.
Get form TC-40E, Renewable Residential and Commercial
Energy Systems Tax Credits, from the Governor's Offi ce of Credit calculation:
Energy Development with their certifi cation stamp. Do not Gallons _______ x .314 = Credit _______
send this form with your return. Keep the form and all related
documents with your records to provide the Tax Commission
upon request. There is no form for this credit. Keep all related documents
with your records to provide the Tax Commission upon request.
For more information, contact:
Governor's Offi ce of Energy Development (OED) (48) Farm Operation Hand Tools Credit
PO Box 144845 (UC §59-7-614.1)
Salt Lake City, UT 84114 This credit is for sales and use tax paid on hand tools pur-
801-538-8732 or 801-538-8702 chased and used or consumed primarily and directly in a farm-
energy.utah.gov/renewable-energy- ing operation in Utah. The credit only applies if the purchase
systems-tax-credit price of a tool is more than $250.
(43) Pass-through Entity Withholding Tax Credit There is no form for this credit. Keep all related documents
(UC §59-7-614.4) with your records to provide the Tax Commission upon request.
If a pass-through entity is required to withhold Utah income Line 29 – Prepayments from Schedule E
tax on any income attributable to this corporation under
§59-10-1403.2, the pass-through entity must provide a Utah Credit is allowed for advance payments made as quarterly es-
Schedule K-1 showing the amount of Utah withholding paid timated tax payments, prepayments and extension payments
on behalf of this corporation. Enter this amount as a refund- (form TC-559). Include any overpayment from a prior year that
able credit using code 43. was applied to this year. Use Schedule E to compute the total
prepayment.
Attach copies of Utah Schedule K-1(s) to the return to receive
proper credit. Line 30 – Amended Return Only
(46) Mineral Production Withholding Tax Credit This line is only for amended returns. Enter the amount of tax
(UC §59-6-102) paid with the original return and/or subsequent payments made
prior to fi ling this amended return less any previous refunds
Enter the total of the mineral production tax withheld as shown
(exclude refund interest). Enter a net refund as a negative
on forms TC-675R or Utah Schedule K-1(s) for the tax year.
amount (preceded by a minus sign).
For a fi scal year corporation, the credit is claimed on the
corporate return that is required to be fi led during the year Line 31 – Total Refundable Credits and
following the December closing period of the form TC-675R.
Prepayments
Attach copies of form TC-675R or Utah Schedule K-1(s) to
Add lines 28 through 30. Carry this amount to TC-20, page
the return to receive proper credit.
1, line 8.
|
|
2021 Utah TC-20 Instructions 13
Schedule B – Additions to Unadjusted Income
Line 1 – Interest from State Obligations Line 5 – Federal Deductions Taken Previously
Enter interest from bonds, notes and other evidences of in- on a Utah Return
debtedness issued by any state of the United States, including Enter any deduction on this year’s federal return that was
any agency and instrumentality of a state of the United States. deducted on a prior year Utah return.
Lines 2a - 2e – Add Taxes Deducted to Line 6 – Federal Charitable Contributions
Determine Income Enter any federal charitable contributions from federal form
Amounts included in federal taxable income from refunds of 1120, line 19.
the following taxes should be netted against similar taxes on
the appropriate lines. Line 7 – Gain (Loss) on Sections
338(h)(10) or 336(e)
Line 2a – Income Taxes Paid to Any State
Enter the amount of any gain or loss determined under
Enter taxes imposed by and paid to any state that are mea- UC §59-7-114(3) regarding a target corporation under IRC
sured by income. §338, if that gain or loss has not been included in income, and
the amount of any gain or loss determined under UC §59-7-115
Line 2b – Franchise or Privilege Taxes Paid to regarding corporations treated for federal purposes as having
Any State disposed of its assets under IRC §336(e), if that gain or loss
Enter franchise taxes paid by a corporation to any state for the has not been included in income.
privilege of doing business or exercising its corporate franchise. The purpose of this addition is to make sure the gain or loss on
IRC §§338(h)(10) and 336(e) transactions are treated similarly
Line 2c – Corporate Stock Taxes Paid to Any for Utah and federal purposes as a deemed sale of assets. The
State gain or loss is only added if it has not already been included
Enter corporate stock taxes paid to any state. in income.
Line 2d – Taxes Paid to a Foreign Country Line 8 – Adjustments Due to Basis Difference
Enter any income, franchise, or capital stock taxes imposed Utah laws generally follow the Internal Revenue Code for
by a foreign country, a United States possession or the Com- depreciation, amortization and basis. However, basis differ-
monwealth of Puerto Rico and paid during the taxable year. ences occasionally arise due to differences between Utah and
federal laws in limited instances. Some examples include the
Line 2e – Business and Occupation Taxes Paid sale of an asset for which an IRC §338 election was made
to Any State in a tax year beginning prior to Jan. 1, 1994 (Utah did not
follow IRC §§338 or 338(h)(10) for tax years prior to 1994);
Enter business and occupation taxes deducted for federal and adjustments attributed to the federal consolidated rules
purposes. under IRC §1502. A company may not deduct basis differences
generated by errors in prior returns in years when Utah and
Line 3 – Safe Harbor Lease (SHL) Adjustments federal depreciation or amortization amounts are required to
SHLs originated from adjustments primarily available to busi- be the same.
nesses during the years 1981 and 1982 under ERTA. These
provisions allowed transfers of certain tax benefi ts for federal Line 9 – Expenses Attributable to 50 percent
tax purposes. However, Utah did not adopt these provisions, Unitary Foreign Dividend Exclusion
and the effects of any remaining SHL adjustments must be
Enter any expenses directly and indirectly attributable to the
reversed for Utah purposes.
dividends from subsidiaries excluded on Schedule C, line 7
Add to income: (i.e., 50 percent exclusion of dividends from unitary foreign
subsidiaries). To calculate indirect interest expense attribut-
SHL Purchaser/Lessor able to excluded dividends:
1. Interest expense 1. Divide the taxpayer’s average investment in dividend pay-
2. Depreciation claimed on SHL property ing subsidiaries by the taxpayer’s average investment in
total assets.
SHL Seller/Lessee
2. Multiply the result by the total interest expense.
1. Amount of gain on the sale of federal tax benefi ts
2. Rental expense on SHL property Line 10 – Installment Sales Income Previously
Reported for Federal but Not Utah
Line 4 – Capital Loss Carryover
Purposes
Enter any capital losses deducted on a Utah corporate return
in previous years but used to offset capital gains on this year’s Add any installment sales income from installment sales
federal return. made in tax years beginning before Jan. 1, 1994, if the Utah
installment provisions of former UC §59-7-119 were used. If
the Utah installment provisions were used on the Utah return,
then a timing difference was created between federal and Utah.
|
|
2021 Utah TC-20 Instructions 14
Line 11 – Nonqualifi ed Withdrawal from Utah Line 15 – Deductions for a Royalty or Other
my529 Account (UC §59-7-105(10)) Expense Paid to an Entity Related by
If you withdrew an amount from a Utah my529 account but Common Ownership
did not use it for qualifi ed higher education expenses, and Enter the amount of any deduction taken on a Utah return for
the withdrawal did not meet an exception under IRC §529(c) a royalty or other expense that a corporation pays to an entity
or §530(d), enter that amount to the extent the amount was related by common ownership for the use of an intangible as-
deducted on the current or a previously fi led Utah tax return. set where the intangible asset is owned by the entity, unless
If you are a my529 account owner, you will receive form TC- the entity is subject to income taxes on the royalty or other
675H, my529 Tax Statement for Contributions, Withdrawals, expense in Utah, another state or a foreign government that
and Transfers, from my529. Keep this form with your records. has an income tax treaty with the United States in the same
If you have any questions about my529 accounts, call my529 tax year.
at 800-418-2551, or visit my529.org.
Line 16 – Payroll Protection Program Grant or
Line 12 – Income (Loss) From IRC Section 936 Loan Addback
Corporations If you received a COVID-19 Payroll Protection Program (PPP)
IRC §936 corporations are fully includable in the combined grant or loan, enter any amount that:
report. Add any income or loss from IRC §936 corporations. 1. was forgiven during the 2021 tax year,
2. is exempt from federal income tax, and
Line 13 – Foreign Income (Loss) For Worldwide
Combined Filers 3. you used for expenses that you deducted on your federal
tax return.
Corporations electing to fi le a worldwide combined report must
include income and losses of each corporation in the unitary If you own an interest in an LLC, partnership, S-corporation
group regardless of the country in which the corporation is or trust that received a PPP grant or loan meeting these re-
incorporated or conducts business. Add any income or loss quirements, include your distributed share on this line. (See
before extraordinary items and prior period adjustments and the "Other Income" line of Utah Schedule K-1 received from
before the provision for income, war profi ts and excess profi ts the LLC, partnership, S-corporation or trust.)
taxes as reported on federal form 5471 for foreign corporations.
Line 17 – RESERVED
Line 14 – Income (Loss) of Unitary
Line 18 – RESERVED
Corporations Not Included in Federal
Consolidated Return Line 19 – Total Additions
Add any income and loss of unitary corporations owned greater Add lines 1 through 18. Enter the result on line 19 and on
than 50 percent whose income or loss is not included on the Schedule A, line 2.
federal consolidated return. Refer to Combined Reports in
the General Instructions for additional information on unitary
combined fi lings.
|
|
2021 Utah TC-20 Instructions 15
Schedule C – Subtractions from Unadjusted Income
Line 1 – Intercompany Dividend Elimination SHL Seller/Lessee
Enter dividends received from U.S. corporations owned greater 1. Interest income
than 50 percent whose income is included on this return and 2. Depreciation on SHL property
whose dividend has not been previously eliminated.
Line 6 – Federal Income Previously
Line 2 – Foreign Dividend Gross-up Taxed by Utah
Enter the foreign dividend gross-up included in gross income Enter any income on the federal corporate return, form 1120,
for federal income tax purposes under IRC §78. that was previously taxed by Utah. Attach supporting sched-
ules and documentation.
Line 3 – Net Capital Loss
You must enter your capital losses if you elected to take a Line 7 – Fifty percent Exclusion for Dividends
deduction for capital losses incurred in the taxable year. If a from Unitary Foreign Subsidiaries
current year deduction is not taken, you must carry the loss Enter 50 percent of the dividends received or deemed received
forward as provided in IRC §1212(a)(1)(B) and (C). from subsidiaries that are members of the unitary group and
are organized or incorporated outside of the United States,
Line 4a – Federal Jobs Credit Salary Reduction
unless those subsidiaries are included in a combined report.
Enter the amount of any salary expense reduction due to claim- In that case, the dividends are eliminated as an intercompany
ing the federal jobs credit under IRC §51. transaction on line 1.
Line 4b – Federal Research and Development For corporations fi ling a water’s edge combined report, the
50-percent exclusion includes dividends from unitary foreign
Credit Expense Reduction
corporations, IRC Section 965(a) income, IRC 951A (GILTI)
Enter any qualifi ed research and basic research expense income, and subpart F income.
reduction due to claiming the research and development
credit under IRC §41. Line 8 – Fifty percent Exclusion of Foreign
Operating Company Income (Loss)
Line 4c – Federal Orphan Drug Credit Clinical
If you are fi ling a water’s edge combined report, enter 50
Testing Expense Reduction
percent of the adjusted income or loss of a foreign operating
Enter any qualifi ed clinical testing expense reduction due to company. The exclusion is determined after:
claiming the federal orphan drug credit under IRC §45C.
1. the removal of all intercompany transactions between the
Line 4d – Expense Reduction for Other Federal foreign operating company and any other entity within the
water’s edge group,
Credits
2. the exclusion of all income generated from intangible
Enter any expense reduction attributable to claiming any other property, and
federal credit. Attach applicable federal form.
3. the exclusion of all income from assets held for investment
Line 4e – Federal Qualifi ed Tax Credit Bond and not from a regular business trading activity.
Credit, Income Increase A foreign operating company is a corporation (other than an
Enter any increase in interest income for federal tax purposes due IRC §936 corporation) incorporated in the United States with
to claiming the qualifi ed tax credit bond credit under IRC §54A. 80 percent or more of its business activity, based on the aver-
age of the property and payroll factors, conducted outside the
Line 4f – Federal Qualifi ed Zone Academy United States, and which has at least:
Bond Credit, Income Increase 1. $1,000,000 of payroll (as included in the payroll factor)
Enter any gross income increase for federal tax purposes located outside of the United States, and
due to claiming the qualifi ed zone academy bond credit under 2. $2,000,000 of property (as included in the property factor)
IRC §1397E. located outside of the United States.
Line 5 – Safe Harbor Lease (SHL) Adjustments Line 9 – Gain (Loss) on Certain Stock Sales
You must reverse the effects of any remaining SHL adjust- Enter the gain or loss on the sales of stock included in tax-
ments for Utah purposes. For general SHL information, see able income, yet not taxable for federal purposes because
the instructions for Schedule B, line 3. the transaction is considered to be a deemed sale of assets
under IRC §§338(h)(10) or 336(e).
Subtract from income:
The purpose of this subtraction is to avoid the double taxation
SHL Purchaser/Lessor that would occur if both the gain on the stock sale and the
1. Rental income gain on the deemed sale of assets were included in income.
Utah law follows the federal statute that taxes the gain on the
2. Amortization of the purchase price of tax benefi ts (purchase deemed sale of assets.
price of tax benefi ts must be capitalized)
|
|
2021 Utah TC-20 Instructions 16
Line 10 – Adjustments Due to Basis Difference Line 14 – RESERVED
Enter adjustments to gains, losses, depreciation expense,
Line 15 – Dividends Received from a Captive
amortization expense and similar items due to a difference
between basis for federal and Utah purposes as explained in Real Estate Investment Trust by a
instructions for Schedule B, line 8. Member of the Unitary Group
If any member of the unitary group is a “controlling entity of
Line 11 – Interest Expense a captive real estate investment trust,” include the dividends
Enter interest expense not deducted on the federal corporate received or deemed received from each captive real estate
return under IRC §§265(b) or 291(e). investment trust.
Line 12 – Dividends from Admitted Insurance Line 16 – IRC Section 857(b)(2)(E) Deduction
Company Subsidiaries from a Captive REIT
Enter dividends received from admitted insurance company Enter the amount of any federal deduction taken under IRC
subsidiaries exempt under UC §59-7-102(1)(c). §857(b)(2)(E) on federal form 1120-REIT for each captive real
estate investment trust included in the Utah combined group.
Line 13 – Contributions to Utah my529
Account(s) (UC §59-7-106(1)(r)) Line 17 – FDIC Payments
If a qualifi ed contribution was made to your my529 account, Enter any FDIC premiums that were not allowed as a deduc-
you may claim a deduction on line 13. To qualify, the contribu- tion on the federal return under IRC §162(r).
tion must be made during the taxable year and not deducted
on your federal return. Line 18 – COVID-19 Utah Grant Funds Included
in Unadjusted Income (UC §59-7-
If you are a my529 account owner, you will receive form
TC-675H, my529 Tax Statement for Contributions, Withdraw- 106(1)(x))
als, and Transfers, from my529. Enter on line 13 the amount Enter the amount of any federally-funded COVID-19 grant
from form TC-675H, box 1C. funds or forgiven loans received from Utah or a local Utah
Keep form TC-675H with your records. If you have any ques- government that are included in unadjusted income on this
tions about my529 accounts, call my529 at 1-800-418-2551, return.
or visit my529.org.
Lines 19-20 – RESERVED
Line 21 – Total Subtractions
Add lines 1 through 20. Enter the result on line 21 and on
Schedule A, line 4.
|
|
2021 Utah TC-20 Instructions 17
Schedule D – Utah Contributions Deduction
Utah allows a deduction for charitable contributions Line 4 – Utah Contribution Carryforward
(UC §59-7-109).
Charitable contributions which exceed the allowable deduction
Line 1 – Apportionable Income Before for Utah may be carried forward to the fi ve succeeding taxable
years in the same manner as allowed under federal law. Enter
Contributions Deduction
the excess Utah contributions carried forward to this tax year.
Enter amount from Schedule A, line 9. If this is a loss, no Attach a schedule showing contributions made that exceed
contribution deduction is allowed. the Utah contribution limitation and that have not been previ-
ously deducted and are available to be carried forward to the
Line 2 – Utah Contribution Limitation current year.
Charitable contributions for the current year, including excess
contributions carried forward from a prior year, cannot exceed Line 5 – Total Contributions Available
10 percent of the apportionable income before contributions. Add line 3 and line 4.
(See UC §59-7-109(2).)
Multiply line 1 by 10% (.10) and enter the limitation amount. Line 6 – Utah Contributions Deduction
Enter the lesser of line 2 or line 5 here and on Schedule A,
Line 3 – Current Year Contributions line 10.
Enter charitable contributions made for the current year.
Line 7 – Contribution Carryover to Next Year
Subtract line 6 from line 5. This is the amount of your Utah
contribution carryover to the next taxable year.
Schedule E – Prepayments of Any Type
Line 1 – Overpayment Applied from Prior Year Line 3 – Other Prepayments
Enter the amount of any refund applied from the prior year to List the date and amount of each prepayment made for the
the current year’s tax liability. fi ling period. Enter the check number if a payment was not
made electronically. Enter the total amount on line 3. Attach
Line 2 – Extension Prepayment additional pages, if necessary.
List the date and amount of any extension prepayment. Enter
the check number if a payment was not made electronically. Line 4 – Total Prepayments
Add lines 1, 2 and 3. Enter the total on this line and on Sched-
ule A, line 29.
|
|
2021 Utah TC-20 Instructions 18
Schedule H – Nonbusiness Income Net of
Expenses
Complete TC-20, Schedule H to determine nonbusiness
Utah Nonbusiness Income
income allocated to Utah and outside Utah.
Nonbusiness income is all income that does not arise from Lines 1a-1e – Utah Nonbusiness Income
the conduct of a taxpayer's trade or business operations. In- Complete the information in each column and enter the gross
tangible income must be properly classifi ed and based upon Utah nonbusiness income from each class of income being
factual evidence. The burden of proof is on the taxpayer to allocated. Use additional pages or supporting schedules in
justify the manner in which the income is claimed on the return. the same format, if necessary, to provide complete information
Interest income is business income where the intangible about additional sources of nonbusiness income.
with respect to which the interest was received arises out of
or was created in the regular course of the taxpayer’s trade or Line 2 – Total of Columns C and D
business operations, or where the purpose for acquiring and Enter the total of the amounts on lines 1a through 1e in column
holding the intangible is an integral, functional, or operative C and column D.
component of the taxpayer’s trade or business operations, or
otherwise materially contributes to the production of business Line 3 – Total Utah Nonbusiness Income
income of the trade or business operations. See Tax Commis- Enter the total of column E, lines 1a through 1e.
sion Rule R865-6F-8(2)(e)(iii).
Dividends are business income where the stock with re- Lines 4a-4e – Direct Related Expenses
spect to which the dividends were received arose out of or Describe and enter amounts of direct expenses on the same
was acquired in the regular course of the taxpayer’s trade or letter line as the corresponding Utah nonbusiness income is
business operations or where the acquiring and holding of listed on lines 1a through 1e. Direct related expenses include
the stock is an integral, functional, or operative component wages, interest, depreciation, etc. (UC §59-7-101).
of the taxpayer’s trade or business operations, or otherwise
materially contributes to the production of business income of Line 5 – Total Direct Related Expenses
the trade or business operations. See Tax Commission Rule Enter the sum of direct related expenses by adding lines 4a
R865-6F-8(2)(e)(iv). through 4e.
Gain or loss from the sale, exchange, or other disposition
of real property or of tangible or intangible personal property Line 6 – Utah Nonbusiness Income Net of
constitutes business income if the property while owned by Direct Related Expenses
the taxpayer was used in, or was otherwise included in the Subtract line 5 from line 3.
property factor of the taxpayer’s trade or business. See Tax
Commission Rule R865-6F-8(2)(e)(ii). Line 7 – Beginning-of-Year Assets
Rental income from real and tangible property is business Enter in column A the total beginning-of-year value of assets
income if the property with respect to which the rental income used to produce Utah nonbusiness income from line 2, column
was received is or was used in the taxpayer’s trade or busi- C. Enter in column B the beginning-of-year value of your total
ness and therefore is includable in the property factor. See assets. Include all assets in column B, including Utah assets.
Tax Commission Rule R865-6F-8(2)(e)(i).
Complete Schedule H as follows: Line 8 – End-of-Year Assets
• Complete lines 1a through 14 if you are claiming only Utah Enter in column A the total end-of-year value of assets used
nonbusiness income. to produce Utah nonbusiness income from line 2, column D.
Enter in column B the end-of-year value of your total assets.
• Complete lines 15a through 28 if you are claiming only
Include all assets in column B, including Utah assets.
non-Utah nonbusiness income.
• Complete lines 1a through 28 if you are claiming both Utah Line 9 – Sum of Beginning and
and non-Utah nonbusiness income. Ending Asset Values
Use additional pages or supporting schedules in the same Add lines 7 and 8 for each respective column.
format, if necessary, to provide complete information, including
a description of the business purpose for making the invest- Line 10 – Average Asset Value
ment, the transactions creating the nonbusiness income, and Divide line 9 by 2 for each column.
the use of revenues generated by the nonbusiness investment.
Line 11 – Utah Nonbusiness Asset Ratio
Divide line 10, column A by line 10, column B. Round the
result to four decimal places. Do not enter a decimal greater
than 1.0000, and do not enter a negative number.
|
|
2021 Utah TC-20 Instructions 19
Line 12 – Interest Expense Line 20 – Non-Utah Nonbusiness Income Net of
Enter the total amount of interest deducted on federal form Direct Related Expenses
1120, line 18 and elsewhere on the federal return. Subtract line 19 from line 17.
Line 13 – Indirect Related Expenses for Utah Line 21 – Beginning-of-Year Assets
Nonbusiness Income Enter in column A the total beginning-of-year value of assets
Multiply line 12 by the ratio on line 11. used to produce non-Utah nonbusiness income from line 16,
column C. Enter in column B the beginning-of-year value of
Line 14 – Total Utah Nonbusiness Income Net your total assets. Include all assets in column B, including
of Expenses Utah assets.
Subtract line 13 from line 6. Enter amount here and on Sched-
Line 22 – End-of-Year Assets
ule A, page 1, line 6.
Enter in column A the total end-of-year value of assets used
to produce non-Utah nonbusiness income from line 16, col-
Non-Utah Nonbusiness Income umn D. Enter in column B the end-of-year value of your total
assets. Include all assets in column B, including Utah assets.
Lines 15a-15e – Non-Utah Nonbusiness Income
Complete the information in each column and enter the gross Line 23 – Sum of Beginning and Ending Asset
non-Utah nonbusiness income from each class of income Values
being specifi cally allocated. Use additional pages or support- Add lines 21 and 22 for each respective column.
ing schedules in the same format, if necessary, to provide
complete information about additional sources of non-Utah Line 24 – Average Asset Values
nonbusiness income.
Divide line 23 by 2 for each column.
Line 16 – Total of Columns C and D
Line 25 – Non-Utah Nonbusiness Asset Ratio
Enter the total of the amounts on lines 15a through 15e in
column C and column D. Divide line 24, column A by line 24, column B. Round the
result to four decimal places. Do not enter a decimal greater
Line 17 – Total Non-Utah Nonbusiness Income than 1.0000, and do not enter a negative number.
Enter the total of the amounts on lines 15a through 15e in Line 26 – Interest Expense
column E.
Enter the total amount of interest deducted on federal form
Lines 18a-18e – Direct Related Expenses 1120, line 18 and elsewhere on the federal return.
Describe and enter amounts of direct expenses on the same Line 27 – Indirect Related Expenses for Non-
letter line as the corresponding non-Utah nonbusiness income Utah Nonbusiness Income
on lines 15a through 15e. Direct related expenses include
wages, interest, depreciation, etc. (UC §59-7-101). Multiply line 26 by the ratio on line 25.
Line 19 – Total Direct Related Expenses Line 28 – Total Non-Utah Nonbusiness Income
Enter the sum of direct related expenses by adding lines 18a Net of Expenses
through 18e. Subtract line 27 from line 20. Enter amount here and on
Schedule A, page 1, line 7.
|
|
2021 Utah TC-20 Instructions 20
Schedule J – Apportionment Schedule
Use TC-20, Schedule J to calculate the portion of the taxpayer’s
income attributable to Utah, if the taxpayer does business both Optional Apportionment or Sales Factor Weighted?
within and outside of Utah.
Complete TC-20, Schedule J to determine the apportionment Did the taxpayer apportion income using the phased-in
fraction (decimal). The factors express a ratio for property in sales factor weighted fraction during the prior taxable year?
Utah to total property everywhere, for wages and salaries in
Utah to total wages and salaries everywhere, and for sales YES NO
in Utah to total sales everywhere. Use these factors or ratios
to arrive at the Utah apportionment fraction calculated to six Did the taxpayer apportion income using single
decimals. Then apply this fraction (decimal) to the apportion- sales factor during the prior taxable year?
able income (or loss) on Schedule A to arrive at the amount
of income (or loss) apportioned to Utah. In cases where one YES NO
or more of the factors is omitted due to peculiar aspects of
the business operations, use the number of factors present
to determine the Utah apportionment fraction. Does the taxpayer generate greater than
50 percent of total sales everywhere from
Your economic activities, and your method of apportioning economic activities in NAICS codes
income in the previous year, dictate the apportionment method OTHER THAN the identified NAICS codes?
you may use.
YES NO
Pass-through Entity Taxpayers
Partners, shareholders and benefi ciaries of pass-through Does average value of the taxpayer’s
entities (an entity taxed as a partnership, s-corporation or property and payroll in Utah attributable
trust) must include their pro rata share of the pass-through to the excluded NAICS codes exceed
entity's property, payroll and sales in their calculation of the 50 percent of the average value of all the
apportionment factor on TC-20, Schedule J, page 1. taxpayer’s property and payroll in Utah?
If a corporation holds direct and indirect ownership interests in NO YES
tiered pass-through entities, it must include its pro rata share
of the apportionment factors (property, payroll and sales) of
the pass-through entities, applying the respective ownership Single Sales Factor Optional Apportionment
percentages. For example, a corporation that holds 50 percent Can choose:
interest in Partnership A that in turn holds 20 percent interest 1. equally-weighted; or
in Partnership B would include 50 percent of the factors of 2. single sales factor
Partnership A, and 10 percent (50 percent of 20 percent) of
the factors of Partnership B. Excluded NAICS Codes:
Code 211120 Crude Petroleum Extraction
Apportionment Method Industry Group 2121 Coal Mining
To determine if you must apportion income using the single Industry Group 2212 Natural Gas Distribution
Subsector 311 Food Manufacturing
sales factor formula or if you qualify as an optional apportion-
Industry Group 3121 Beverage Manufacturing
ment taxpayer, take into account the economic activities of Code 327310 Cement Manufacturing
each of the entities included in the return. Include the eco- Subsector 482 Rail Transportation
nomic activities of any pass-through entities whose income Code 512110 Motion Picture and Video Production
and factors are included in the return. Subsector 515 Broadcasting (except internet)
Use the fl owchart (below) to determine the method you must Code 522110 Commercial Banking
use to apportion business income.
Identified NAICS Codes:
Sector 21 Mining;
Sales Factor Weighted Taxpayers Industry Group 2212 Natural Gas Distribution
A sales factor weighted taxpayer may only use the sales factor Sector 31-33 Manufacturing EXCEPT:
weighted apportionment formula. • Industry Group 3254 Pharmaceutical & Medicine
Manufacturing
You must use the single sales factor formula if you either: • Industry Group 3333 Commercial & Service Industry
1. apportioned income using the sales factor weighted frac- Machinery Manufacturing
tion during the prior taxable year, • Subsector 334 Computer & Electronic Manufacturing
• Code 336111 Automobile Manufacturing
2. apportioned income using the phased-in sales factor for-
Sector 48-49 Transportation & Warehousing
mula during the prior taxable year, or Sector 51 Information EXCEPT:
• Subsector 519 Other Information Services
Sector 52 Finance & Insurance
|
|
2021 Utah TC-20 Instructions 21
3. generate more than 50 percent of total sales everywhere • Code 211120, Crude Petroleum Extraction
from economic activities in any NAICS codes OTHER • Industry Group 2121, Coal Mining
THAN these identifi ed NAICS codes:
• Industry Group 2212, Natural Gas Distribution
• Sector 21, Mining;
• Subsector 311, Food Manufacturing
• Industry Group 2212, Natural Gas Distribution;
• Industry Group 3121, Beverage Manufacturing
• Sector 31-33, Manufacturing EXCEPT:
• Code 327310, Cement Manufacturing
• Industry Group 3254, Pharmaceutical and Medicine
Manufacturing • Subsector 482, Rail Transportation
• Industry Group 3333, Commercial and Service • Code 512110, Motion Picture and Video Production
Industry Machinery Manufacturing • Subsector 515, Broadcasting (except Internet)
• Subsector 334, Computer and Electronic Product • Code 522110, Commercial Banking
Manufacturing
• Code 336111, Automobile Manufacturing Line Instructions
• Sector 48-49, Transportation and Warehousing
• Sector 51, Information EXCEPT: Business Activity
• Subsector 519, Other Information Services Briefl y describe the nature and location(s) of your Utah busi-
ness activities in the space provided at the top of this schedule.
• Sector 52, Finance and Insurance
Report property and payroll factors on Schedule J, page 1, Lines 1a - 1f – Property Factor
but do not use them to calculate the apportionment of sales Show the average cost value during the taxable year of real
factor weighted taxpayers. and tangible personal property used in the business within
Sales factor weighted taxpayers must calculate the appor- Utah (including leased property) in column A and overall
tionment fraction on Schedule J, Page 2 using Part 2 - Sales (including Utah) in column B.
Factor Formula. Property you own is valued at its original cost. Property you
rent is valued at eight times the net annual rental rate. Net
annual rental rate is the annual rental rate you pay less the
Optional Apportionment Taxpayers annual rate you receive from sub-rentals.
To determine if you are an optional apportionment taxpayer, The average value of property must be determined by averag-
fi rst calculate the following property and payroll factor fractions: ing the cost values at the beginning and end of the tax period.
• Property factor fraction: Add together the value of prop- However, monthly values may be used or required if monthly
erty in Utah attributable to economic activities that are averaging more clearly refl ects your property’s average value.
classifi ed in an excluded NAICS code. Divide this number
Attach a supporting schedule whenever you use monthly
by the value of all property in Utah. Remove property from
averaging.
this calculation if the property is attributable to economic
activities in both excluded NAICS codes and non-excluded If you are a pass-through entity taxpayer, add to line 1e any
NAICS codes. amounts listed on line J of any TC-65 Schedule K-1 you have
• Payroll factor fraction: Add together the amount of payroll received.
in Utah attributable to economic activities that are classi- Enter totals of lines 1a through 1e in the respective columns
fi ed in an excluded NAICS code. Divide this number by on line 1f.
the total amount of payroll in Utah. A taxpayer engaged
in activities in an excluded NAICS code must remove an Line 2 – Property Factor Calculation
individual’s payroll from this calculation of the payroll fac- Determine the property factor (decimal) by dividing line 1f,
tor fraction if the individual’s payroll may be attributed to column A by line 1f, column B.
economic activities in both excluded NAICS codes and
NAICS codes that are not excluded, or to providing man- Line 3 – Payroll Factor
agement, information technology, fi nance, accounting,
Wages, salaries, commissions and other includable com-
legal or human resource services.
pensation paid to employees for personal services must be
Add the property and payroll factor fractions and divide that included in the Utah factor to the extent the services, for which
sum by two. If either the property factor fraction or payroll factor the compensation was paid, were rendered in Utah.
fraction has a denominator of zero, or is otherwise excluded,
Compensation is paid in Utah if:
divide by one. If the average is greater than 50 percent, you
are an optional apportionment taxpayer. 1. the individual’s service is performed entirely within Utah;
Optional apportionment taxpayers may calculate the ap- 2. the individual’s service is performed both within and outside
portionment fraction using either the equally-weighted three Utah, but the service performed outside Utah is incidental
factor formula (Schedule J, Part 1) or the sales factor formula to the individual’s service within Utah; or
(Schedule J, Part 2). 3. some of the service is performed in Utah and:
Excluded NAICS codes are NAICS codes of the 2017 North a. the base of operations or, if there is no base of operations,
American Industry Classifi cation System within: the place where the service is directed or controlled, is
within Utah; or
|
|
2021 Utah TC-20 Instructions 22
b. the base of operations or the place where the service
Apportionment Fraction
is directed or controlled is not in any state where some
part of the service is performed, but the individual’s
residence is in Utah. Part 1 – Equally-Weighted Three Factor
Amounts reportable for employment security purposes may Formula
ordinarily be used to determine the wage factor. If you are an optional apportionment taxpayer using the
Overall wages, including Utah, are listed in column B. equally-weighted three factor formula, complete lines 8 and
If you are a pass-through entity taxpayer, add to line 3a any 9. Otherwise, leave lines 8 and 9 blank.
amounts listed on line K of any TC-65 Schedule K-1 you have
Line 8 – Total Factors
received.
Enter the sum of the factors from lines 2, 4 and 6.
Line 4 – Payroll Factor Calculation
Line 9 – Apportionment Fraction
Determine the payroll factor (decimal) by dividing line 3a,
column A by line 3a, column B. Calculate the apportionment fraction to six decimals by dividing
line 8 by the number of factors used (typically 3 – property,
Lines 5a - 5h – Sales Factor payroll and sales).
The sales factor is the fraction the sales or charges for ser- • If one or more of the factors are not present (i.e., there is a
vices within Utah for the taxable year bear to the overall sales zero in the denominator on lines 1f, 3a or 5h in column B),
for the taxable year. Gross receipts from the performance of divide by the number of factors present.
services in Utah are assigned to the Utah sales numerator if • If the numerator is zero, but a denominator is present,
the purchaser of the service receives a greater benefi t of the include that factor in the number of factors present.
service in Utah than in any other state.
Enter the apportionment fraction (decimal) here and on
Taxpayers that perform a service both in and outside Utah Schedule A, line 12.
must include service income on line 5g in column A (Inside
Utah) if the purchaser of the service receives a greater
benefi t of the service in Utah than in any other state. The Part 2 – Sales Factor Formula
former “cost of performance” method no longer applies. (See
See instructions above for the defi nition and qualifi cations
UC §59-7-319(3)(a).)
of a taxpayer who must apportion income using the sales
Sales of tangible personal property are in Utah if the property factor formula.
is delivered or shipped to a purchaser within Utah regardless
Leave line 10 blank if you are using the equally-weighted
of the F.O.B. point or other conditions of the sale, or if the
three-factor formula.
property is shipped from an offi ce, store, warehouse, factory
or other place of storage in Utah and: Line 10 – Apportionment Fraction
1. the purchaser is the United States Government, or Enter the sales factor from line 6 of Schedule J, page 1. This
2. the taxpayer is not taxable in the state of the purchaser. is the apportionment fraction for this apportionment method.
Overall sales, including Utah, are listed in column B. (Property and payroll factors are not used in the calculation of
the apportionment fraction for taxpayers who must apportion
Note: Securities brokerage businesses must follow the provi- income using the single sales factor formula.)
sions in UC §59-7-319(6).
Enter the apportionment fraction (decimal) here and on
If you are a pass-through entity taxpayer, add to line 5g any Schedule A, line 12.
amounts listed on line L of any TC-65 Schedule K-1 you have
received.
Enter totals of lines 5a through 5g in their respective columns Specialized Apportionment Laws
on line 5h. and Rules
Specialized apportionment procedures apply for:
Line 6 – Sales Factor Calculation
• Trucking Companies (R865-6F-19)
Determine the sales factor (decimal) by dividing line 5h, column
A by line 5h, column B. • Railroads (R865-6F-29)
• Publishing Companies (R865-6F-31)
NAICS Code for Taxpayer • Financial Institutions (R865-6F-32)
• Telecommunications (R865-6F-33)
Line 7 – NAICS Code
• Registered Securities or Commodities Broker or Dealer
This is a mandatory fi eld. Your NAICS code may dictate your (R865-6F-36)
apportionment method.
• Airlines (UC §§59-7-312 thru 319)
Enter on line 7 the NAICS code for the primary business activ- • Sale of Management, Distribution or Administration Ser-
ity. Do not use the holding company NAICS code. vices to or on Behalf of a Regulated Investment Company
If multiple NAICS codes apply to this fi ling, attach an explana- (UC §59-7-319(5))
tion showing the percentage of business activity associated
with each NAICS code.
|
|
2021 Utah TC-20 Instructions 23
Schedule –MCorporations Included in Combined
Filings
Any corporation fi ling a combined report must complete
Schedule M if one or more of the subsidiaries or affi liated Minimum Tax
corporations is incorporated, qualifi ed, or doing business in
Utah. Federal schedules are not acceptable as substitutes. Line a – Number of Corporations
You may not use any other form as a substitute for Enter on line “a” the total number of corporations incorporated,
Schedule M without prior approval from the Tax Commis- qualifi ed and doing business in Utah (including the parent
sion. See Guidelines for Substitute Utah Tax Forms, at corporation if incorporated, qualifi ed or doing business in
tax.utah.gov/developers/substitute-forms. Utah) that are listed on the Schedule M.
List only corporations incorporated, qualifi ed or doing busi- Line b – Total Minimum Tax
ness in Utah. Corporations not listed on Schedule M will not
be considered to have met the Utah fi ling requirements. Use Multiply the number of corporations listed on line “a” by $100
the Schedule M Supplemental Sheet if you need more space. (the minimum tax). Also, enter this amount on Schedule A,
line 18b.
|
|
2021 Utah TC-20 Instructions 24
Utah State Tax Commission
TC-559
Corporate/Partnership Payment Coupon Rev. 11/16
Payment Coupon Penalties and Interest
Use payment coupon TC-559 to make the following corporate/partnership If your tax payments do not equal the lesser of 90 percent of the
tax payments: current-year tax liability ($100 minimum tax for corporations) or 100
1) Estimated tax payments percent of the previous-year tax liability, we will assess a penalty of 2
percent of the unpaid tax for each month of the extension period. We will
2) Extension payments assess a late filing penalty if you file the return after the extension due
3) Return payments date.
Mark the circle on the coupon that shows the type of payment you are making. We will assess interest at the legal rate from the original due date until paid
in full.
Corporation Estimated Tax Requirements See Pub 58, Utah Interest and Penalties, at tax.utah.gov/forms.
Every corporation with a tax liability of $3,000 or more in the current or
previous tax year must make quarterly estimated tax payments. A parent Where to File
company filing a combined report must make the payment when the total Send your payment coupon and payment to :
tax is $3,000 or more for all affiliated companies, including those that pay
only the minimum tax. Corporate/Partnership Tax Payment
Utah State Tax Commission
A corporation does not have to make estimated tax payments the first year 210 N 1950 W
it is required to file a Utah return if it makes a payment on or before the due Salt Lake City, UT 84134-0180
date, without extension, equal to or greater than the minimum tax.
Estimated tax payments are due in four equal payments on the 15th day of
the 4th, 6th, 9th and 12th months of the entity’s taxable year. You may Electronic Payment
make quarterly payments equal to 90 percent of the current year tax or 100 You may make estimated tax, extension and return payments at
percent of the previous year tax. A corporation that had a tax liability of tap.utah.gov.
$100 (the minimum tax) for the previous year may prepay the minimum tax
amount of $100 on the 15th day of the 12th month instead of making four
$25 payments.
The Tax Commission will charge an underpayment penalty to entities that
fail to make or underpay the required estimated tax.
Extension Payment Requirements
A corporation/partnership has an automatic filing extension if it makes the
necessary extension payment by the return due date. The estimated tax
payments must equal at least the lesser of:
1) 90 percent of the current year tax liability
(or the $100 corporation minimum tax, if greater), or
2) 100 percent of the previous-year tax liability.
The remaining tax, plus any penalty and interest, is due when the return is filed.
Note: A pass-through entity (partnership or S corporation) must pay 100
percent of any pass-through withholding by the original due date to avoid
penalties and interest.
SEPARATE AND RETURN ONLY THE BOTTOM COUPON WITH PAYMENT. KEEP TOP PORTION FOR YOUR RECORDS.
TC-559
Corporation/Partnership Mail to: Utah State Tax Commission, 210 N 1950 W, SLC UT 84134-0180 Rev. 11/16
Estimated payment:
Payment Coupon
1st qtr. 3rd qtr. Extension payment
Tax year ending (mm/dd/yyyy) 2nd qtr. 4th qtr. Return payment
Name of corporation/partnership EIN
C
P
Address
T
City State Zip code
Payment amount enclosed $ 00
Make check or money order payable to the Utah State Tax Commission.Make check or money order payable to the Utah State Tax Commission.
Do not send cash. Do not staple check to coupon. Detach check stub.Do not send cash. Do not staple check to coupon. Detach check stub.
|
| 2021 Utah TC-20 Instructions 25 Common Return Errors 1. Unitary businesses not fi ling a combined report – Groups of corporations that are engaged in an integrated unitary business must fi le on a combined basis. See in- structions on page 3. 2. Utah sales factor on Schedule J – Out-of-state corpora- tions qualifi ed in Utah, but not doing business in Utah must Please arrange your return in the fi le a corporate return paying the minimum tax. However, sales into Utah are not required to be included in the gross following order: receipts numerator, except as provided under Utah Rule 1. Utah form TC-20 R865-6F-24. Conversely, corporations making sales from 2. Utah schedules A through M (if required), in alphabeti- Utah into a state where they are qualifi ed but not doing cal order business must include such sales in the Utah gross receipts 3. Federal extension form, if applicable numerator as throwback sales, except as provided under 4. First six pages only of your federal return (plus Form Utah Rule R865-6F-24. 1120, Schedule M-3 and IRS form 1125-A, if applicable) 3. Net capital losses may not be carried back – Capital 5. Other supporting documentation only as requested in losses may be deducted in full in the year incurred or may these instructions be carried forward. See UC §59-7-106(2). 4. Dissolution or withdrawal – Corporations no longer in Do not send a copy of your entire federal corporation business or no longer doing business in Utah are required return. to legally dissolve or withdraw the corporation. See instruc- tions on page 1. 5. Pass-through entity income and factors – Income or loss from partnership or joint venture interests must be included in income and apportioned to Utah. |