Instructions for Filing Illinois State Income Tax: Schedule K-1-P for Individuals, Slides of Business

Download Instructions for Filing Illinois State Income Tax: Schedule K-1-P for Individuals and more Slides Business in PDF only on Docsity! Schedule K-1-P(2) (R-05/22)Page 1 of 13 • PTE tax credit is the amount distributed to partners or shareholders by a partnership or S corporation if the election to pay PTE tax was made. This amount is reported on Schedule K-1-P. If a PTE made the election to pay PTE tax, then it passed through to its members both • the credit for PTE tax it paid and • each member’s distributive share of the PTE tax credit it received from electing pass-through entities in which it is a member. A nonresident individual partner of a partnership or S corporation for a taxable year in which the election to pay PTE tax was made shall not be required to file an income tax return under the IITA for such taxable year if the only source of net income of the individual (or the individual and the individual’s spouse in the case of a joint return) is from an entity making the PTE election and the credit allowed to the partner equals or exceeds the individual’s liability for the tax imposed under subsections (a) and (b) of Section 201 of the IITA for the taxable year. When is pass-through entity income earned? Pass-through entity income is considered earned on the last day of the pass-through entity’s taxable year. Pass-through entity income is not considered received equally throughout the year. The pass-through entity’s tax year ending date is listed in the upper right corner of the Schedule K-1-P you received. What if the partnership is an investment partnership? If the partnership that completed the Schedule K-1-P entered “investment partnership” in Step 1, Line 4, all of the income you receive from the partnership is usually treated as nonbusiness income that is allocable to your state of residence (individuals) or state of commercial domicile (all other persons or entities). However, the income you receive from the partnership will be treated as business income if your investment in the partnership is related to another business activity of yours or serves an operational function to another business activity of yours or where your contribution to the partnership was made out of working capital from your trade or business. If your income is treated as business income, you must apportion it as if you had earned the income directly, rather than through the partnership. The apportionment should be completed on the correct forms, as follows: • Nonresident individuals - use Form IL-1040, Schedule NR. • Nonresident trusts and estates - use Form IL-1041, Schedule NR. • Corporations (excluding S corporations) - use Form IL-1120 and complete Step 4, Figure your income allocable to Illinois. • Partnerships or S corporations - use Form IL-1065 or Form IL-1120-ST and complete Step 6, Figure your income allocable to Illinois. What’s New for 2021? The Reimagining Electric Vehicles (REV) Illinois Investment credit (Code 5230) is effective for tax years beginning on or after November 16, 2021. The Pass-through Entity (PTE) tax credit, effective for tax years ending on or after December 31, 2021, and beginning prior to January 1, 2026, has been added as Step 7, Line 53a. The Agritourism Liability Insurance tax credit (Code 5440) is effective for tax years beginning on or after January 1, 2022. General Information What is the purpose of Schedule K-1-P? The partnership or the S corporation listed on the front of Schedule K-1-P has completed and provided you with the schedule to reflect your specific share of the partnership’s or the S corporation’s income, modifications, and credits. Use the completed schedule and these instructions to help you report the items shown on Schedule K-1-P on your Illinois Income Tax return. What must I attach? You must attach a copy of any Schedule K-1-P you receive from partnerships and S corporations to your tax return. You should also keep a copy for your records. If you receive a Schedule K-1-P that has “the following information is included in the Schedule K-1-P from _______” (the name of the partnership or S corporation) written at the top, it is a pro forma Schedule K-1-P. The pro forma Schedule K-1-P has been included to aid you in the completion of your return and should not be submitted with your tax return. Definitions • Pass-through entity - the partnership or S corporation that sent you Schedule K-1-P is a pass-through entity. • Pass-through entity income is the income reported on your Schedule K-1-P. • Pass-through withholding is the amount paid by the pass-through entity on your behalf. This amount is listed on Line 55 of your Schedule K-1-P. Not everyone who receives a Schedule K-1-P will have pass-through withholding reported. If you are a resident of Illinois or if you submitted Form IL-1000-E, Certificate of Exemption for Pass-through Withholding Payments, to the pass- through entity, then you will not have pass-through withholding reported on your Schedule K-1-P. In this case, you will be responsible for reporting and paying Illinois Income tax on the pass-through income. • Pass-through Entity (PTE) tax is an amount equal to 4.95 percent (.0495) of the taxpayer’s calculated net income for the taxable year paid by a partnership (other than a publicly traded partnership under Section 7704 of the Internal Revenue Code) or subchapter S corporation who elects to pay the tax for taxable years ending on or after December 31, 2021, and beginning prior to January 1, 2026. Illinois Department of Revenue Schedule K-1-P(2) Partner’s and Shareholder’s Instructions Printed by the authority of the State of Illinois. Electronic only, one copy Schedule K-1-P(2) (R-05/22)Page 2 of 13 • Exempt organizations - use Form IL-990-T and complete Step 3, Figure your income allocable to Illinois. Illinois residents may not include any income from an investment partnership in Column B of their Schedule CR. What if I am engaged in a unitary business with this partnership? If you are engaged in a unitary business with this partnership but the partnership is not included in your Schedule UB, Combined Apportionment for Unitary Business Group, the partnership should have attached a schedule showing your share of the partnership’s apportionment factors and business income. You must determine the portion of your business income taxed by Illinois by adding your share of the partnership’s business income and apportionment factors to your own business income and apportionment factors. If the partnership is included in your Schedule UB, report the items on the Schedule K-1-P in the same manner as you would report the items from a non-unitary partner. What if I am a Grantor Trust or Disregarded Entity? If you are a grantor trust or other disregarded entity for federal and Illinois income tax purposes, check the applicable box on Line 9b, enter the name and identification number of the taxpayer that will report the income or loss from your Schedule K-1-P on their tax return, and provide them with a copy of the Schedule K-1-P and a copy of these instructions. What if I received Schedule K-1-P from a Grantor Trust or Disregarded Entity? If the grantor trust or disregarded entity checkbox on Line 9b is checked and your name and identification number are listed, report the items from the Schedule K-1-P as if it were provided to you by the taxpayer in Step 1. What if I believe the partnership or the S corporation has made an error on my Schedule K-1-P? If you believe the partnership or the S corporation has made an error on your Schedule K-1-P, notify the partnership or the S corporation and ask for a corrected Schedule K-1-P. Do not change any items on your copy. What does Column A represent? Column A represents your specific share of the partnership’s or the S corporation’s income, modifications, and credits. The partnership or the S corporation is required to complete this column if you were a partner or shareholder at any time during the partnership’s or the S corporation’s tax year. If you were a resident of Illinois on the last day of the partnership’s or S corporation’s taxable year, all amounts in Column A must be included as income, modifications, and credits allocated to Illinois. If you were a resident of Illinois on the last day of the partnership’s or the S corporation’s tax year, and you are claiming a credit for taxes paid to another state, see “What does Column B represent?” below. What does Column B represent? Column B represents the portion of Column A that is allocated or apportioned to Illinois. If you were not a resident of Illinois on the last day of the partnership’s or the S corporation’s tax year, be sure the amounts reported in Column B are included in the Illinois amounts reported on your • Form IL-1040, Schedule NR, Nonresident and Part-Year Resident Computation of Illinois Tax, Column B; • Form IL-1041, Schedule NR, Nonresident Computation of Fiduciary Income, Column B; • Form IL-1120, Step 4, Figure your income allocable to Illinois; • Form IL-1065 or Form IL-1120-ST, Step 6, Figure your income allocable to Illinois; or • Form IL-990-T, Step 3, Figure your income allocable to Illinois. If you were a resident of Illinois on the last day of the partnership’s or the S corporation’s tax year, and you are claiming a credit for taxes paid to another state, subtract the amount of each item in Column B from the amount of that item in Column A, and include the difference in the Non-Illinois Portion column for that item on your • Form IL-1040, Schedule CR, Credit for Tax Paid to Other States, or • Form IL-1041, Schedule CR, Credit for Tax Paid to Other States. Steps 3 and 4 - Column B — Step 3, Column B represents your share of the partnership’s or the S corporation’s nonbusiness income allocated to Illinois. Step 4, Column B, represents your share of the partnership’s or the S corporation’s business income apportioned to Illinois. Should I round? You must round the dollar amounts on Schedules K-1-P and Schedules K-1-P(3) to whole-dollar amounts. To do this, you should drop any amount less than 50 cents and increase any amount of 50 cents or more to the next higher dollar. What if I need additional assistance or forms? • Visit our website at tax.illinois.gov for assistance, forms or schedules. • Write us at: ILLINOIS DEPARTMENT OF REVENUE PO BOX 19001 SPRINGFIELD IL 62794-9001 • Call 1 800 732-8866 or 217 782-3336 (TDD, telecommuni- cations device for the deaf, at 1 800 544-5304). • Visit a taxpayer assistance office - 8:00 a.m. to 5:00 p.m. (Springfield office) and 8:30 a.m. to 5:00 p.m. (all other offices), Monday through Friday. Schedule K-1-P(2) (R-05/22)Page 5 of 13 Lines 49 and 50 - If Line 50 is blank, include the amount on Line 49 on your Schedule F, Step 3, Line 6, Column I. Otherwise, skip Line 49 and include the amount on Line 50 on your Form IL-1040, Schedule F, Step 3, Line 6, Column I. Line 51 - Include the amount from Line 51 on your Form IL-1040, Schedule F, Step 2, Line 2. Column B - Illinois share — Lines 48 through 51 - Enter the amounts from Columns A and B for each line, and total the amounts for each column. If Line 50 is blank, add Lines 48, 49, and 51 for both Columns A and B. Otherwise, add Lines 48, 50, and 51. Column A Column B Line 48 ______________ ______________ Line 49 ______________ ______________ Line 50 ______________ ______________ Line 51 ______________ ______________ Total ______________ ______________ Nonresidents: Include the total amount from Column B as a subtraction on your Form IL-1040, Schedule NR, Step 4, Line 44, Column B. Residents claiming taxes paid in other states: Subtract the total amount in Column B from the total amount in Column A, and include the result on your Form IL-1040, Schedule CR, Step 3, Line 39, Column B. Step 7 - Your share of Illinois credits, recapture, pass-through withholding payments, PTE tax credit, and federal income subject to surcharge — If the partnership or S corporation has passed through to you any credit, recapture amounts, income tax payments made on your behalf, or federal income subject to surcharge on Lines 52a through 57, see the specific instructions for Step 7 at the end of these instructions for more information. Step-by-Step Instructions for trusts or estates filing Form IL-1041 If you were a resident of Illinois on the last day of the partnership’s or S corporation’s taxable year and you are not claiming a credit for taxes paid to another state, you will follow the Column A instructions beginning with Step 5. The figures in Steps 3 and 4 are included in the Federal Taxable Income reported on Line 1 of your IL-1041. If the partnership that completed the Schedule K-1-P entered “investment partnership” in Step 1, Line 4, then Column B should be blank. Do not use the Column B instructions for this step. Instead, refer to the instructions under General Information, “What if the partnership is an investment partnership?” Steps 3 and 4 - Your share of nonbusiness and business income or loss — Follow the Steps 3 and 4 instructions to determine the amounts to include on your Form IL-1041, Schedule NR or Schedule CR. Column A - Member’s share — The amounts reported on Lines 10 through 31 must match your federal Schedule K-1. Column B - Illinois share — To determine the amount to include on specific lines of your Form IL-1041 and Schedule CR or NR, add specific lines in Step 3, Column B, to specific lines in Step 4, Column B. The following instructions explain what lines to add together and on what line of your form or schedule these totals are to be included. Interest income - (Lines 10 and 23) Nonbusiness interest is allocable to your state of residence. If you are a nonresident, Step 3, Line 10, Column B, should be “0.” If the Schedule K-1-P you received shows an amount in Column B of this line, you should notify the partnership or S corporation who issued you the schedule and ask for a corrected Schedule K-1-P. Nonresidents: Include your fiduciary’s share of business interest from Step 4, Line 23, Column B, on your Form IL-1041, Schedule NR, Step 3, Line 1, Column C. Residents claiming credit for taxes paid in other states: Subtract the amount on Step 4, Line 23, Column B, from the amount on Step 4, Line 23, Column A, and include the result on your Form IL-1041, Schedule CR, Step 2, Line 1, Column C. Dividend income - (Lines 11 and 24) Nonbusiness dividends are allocable to your state of residence. If you are a nonresident, Step 3, Line 11, Column B, should be “0.” If the Schedule K-1-P you received shows an amount in Column B of this line, you should notify the partnership or S corporation who issued you the schedule and ask for a corrected Schedule K-1-P. Nonresidents: Include your fiduciary’s share of business dividends from Step 4, Line 24, Column B, on your Form IL-1041, Schedule NR, Step 3, Line 2, Column C. Residents claiming credit for taxes paid in other states: Subtract the amount on Step 4, Line 24, Column B, from the amount on Step 4, Line 24, Column A, and include the result on your Form IL-1041, Schedule CR, Step 2, Line 2, Column C. Income or loss from partnerships and S corporations – (Lines 12 - 22 and 25 - 31) Enter the amounts from Columns A and B for each line, and total the amounts for each column. Column A Column B Line 12 ______________ ______________ Line 13 ______________ ______________ Line 14 ______________ ______________ Line 15 ______________ ______________ Line 16 ______________ ______________ Line 17 ______________ ______________ Line 18 ______________ ______________ Line 19 ______________ ______________ Line 20 ______________ ______________ Line 21 ______________ ______________ Schedule K-1-P(2) (R-05/22)Page 6 of 13 Line 22 ______________ ______________ Line 25 ______________ ______________ Line 26 ______________ ______________ Line 27 ______________ ______________ Line 28 ______________ ______________ Line 29 ______________ ______________ Line 30 ______________ ______________ Line 31 ______________ ______________ Total ______________ ______________ Do not double count items reported as both unrecaptured Section 1250 gains on Schedule K-1-P, Line 28, and as Section 1231 gains on Schedule K-1-P, Line 30. Nonresidents: Include your fiduciary’s share of this total amount from Column B on your Form IL-1041, Schedule NR, Step 3, Line 6, Column C. You may include any capital loss amounts on your Form IL-1041, Schedule NR, Step 3, Line 6, Column C, only to the extent those loss amounts are included in your federal taxable income. Residents claiming credit for taxes paid in other states: Subtract the total amount in Column B from the total amount in Column A, and include the result on your Form IL-1041, Schedule CR, Step 2, Line 6, Column C. Step 5 - Your share of Illinois additions and subtractions — Column A - Member’s share of additions and subtractions — Lines 32 through 37 - Enter the amounts from Column A for each line and total the amounts for the column. Column A Line 32 ______________ Line 33 ______________ Line 34 ______________ Line 35 ______________ Line 36 ______________ Line 37 ______________ Total ______________ Enter the total on Form IL-1041, Step 2, Line 9. Lines 38a, 38b and 41 - 47 - Enter the amounts from Column A for each line, and total the amounts for the column. Column A Line 38a ______________ Line 38b ______________ Line 41 ______________ Line 42 ______________ Line 43 ______________ Line 44 ______________ Line 45 ______________ Line 46 ______________ Line 47 ______________ Total ______________ Enter the total on Form IL-1041, Step 3, Line 22. Line 39 - Include the amount from Line 39 on your Schedule 1299-B, River Edge Redevelopment Zone or Foreign Trade Zone (or sub-zone) Subtractions (for corporations and fiduciaries), Step 1, Line 2. Line 40 - Include the amount from Line 40 on your Schedule 1299-B, Step 1, Line 5. Column B - Illinois share of additions and subtractions — Lines 32 through 37 - Enter the amounts from Columns A and B for each line, and total the amounts for each column. Column A Column B Line 32 ______________ ______________ Line 33 ______________ ______________ Line 34 ______________ ______________ Line 35 ______________ ______________ Line 36 ______________ ______________ Line 37 ______________ ______________ Total ______________ ______________ Nonresidents: Include the total amount from Column B on your Form IL-1041, Schedule NR, Step 4, Line 35, Column B. Residents claiming credit for taxes paid in other states: Subtract the total amount in Column B from the total amount in Column A, and enter the result on your Form IL-1041, Schedule CR, Step 3, Line 32, Column B. Lines 38a, 38b, and 41 through 47 - Enter the amounts from Columns A and B for each line, and total the amounts for each column. Column A Column B Line 38a ______________ ______________ Line 38b ______________ ______________ Line 41 ______________ ______________ Line 42 ______________ ______________ Line 43 ______________ ______________ Line 44 ______________ ______________ Line 45 ______________ ______________ Line 46 ______________ ______________ Line 47 ______________ ______________ Total ______________ ______________ Nonresidents: Include the total amount from Column B on your Form IL-1041, Schedule NR, Step 4, Line 47, Column B. Residents claiming credit for taxes paid in other states: Subtract the total amount in Column B from the total amount in Column A, and enter the result on your Form IL-1041, Schedule CR, Step 3, Line 45. Column B. Line 39 - Nonresidents: Include the amount from Column B on your Form IL-1041, Schedule NR, Step 4, Line 42, Column B. Residents claiming credit for taxes paid in other states: Subtract the amount in Column B from the amount in Column A, and enter the result on your Form IL-1041, Schedule CR, Step 3, Line 40, Column B. Line 40 - Nonresidents: Include the amount from Column B on your Form IL-1041, Schedule NR, Step 4, Line 43, Column B. Schedule K-1-P(2) (R-05/22)Page 7 of 13 Residents claiming credit for taxes paid in other states: Subtract the amount in Column B from the amount in Column A, and enter the result on your Form IL-1041, Schedule CR, Step 3, Line 41, Column B. Step 6 - Your share of the Illinois August 1, 1969, appreciation amounts — Column A - Member’s share — Line 48 - Include the amount from Line 48 on your Form IL-1041, Schedule F, Line 2, Column K. Line 49 - Include the amount from Line 49 on your Form IL-1041, Schedule F, Line 2, Column L. Line 51 - Include the amount from Line 51 on your Form IL-1041, Schedule F, Line 2, Column M. Column B - Illinois share — Lines 48, 49, and 51 - Enter the amounts from Columns A and B for each line, and total the amounts for each column. Column A Column B Line 48 ______________ ______________ Line 49 ______________ ______________ Line 51 ______________ ______________ Total ______________ ______________ Nonresidents: Add Lines 48, 49 and 51, Column B. Include the total amount as a subtraction on your Form IL-1041, Schedule NR, Step 4, Line 38, Column B. Residents claiming taxes paid in other states: Subtract the total amount in Column B from the total amount in Column A, and include the result on your Form IL-1041, Schedule CR, Step 3, Line 36, Column B. Step 7 - Your share of Illinois credits, recapture, pass-through withholding payments, PTE tax credit, and federal income subject to surcharge — If the partnership or S corporation has passed through to you any credit, recapture amounts, income tax payments made on your behalf, or federal income subject to surcharge on Lines 52a through 57, see the specific instructions for Step 7 at the end of these instructions for more information. Step-by-Step Instructions for partnerships filing Form IL-1065 and S corporations filing Form IL-1120-ST If the partnership that completed the Schedule K-1-P entered “investment partnership” in Step 1, Line 4, then Column B should be blank. Do not use the Column B instructions. Instead, refer to the instructions under General Information, “What if the partnership is an investment partnership?” Steps 3 and 4 - Your share of nonbusiness and business income or loss — Column A - Member’s share — The amounts reported on Lines 10 through 31 must match your federal Schedule K-1. Column B - Illinois share — To determine the amount to include on specific lines of your Form IL-1065 or Form IL-1120-ST, add specific lines in Step 3, Column B, to specific lines in Step 4, Column B. The following instructions explain what lines to add together and on what line of your form or schedule these totals are to be included. Lines 10 through 31 - Include the amounts in Step 3, Column B in the total amount you report on your Schedule NB. Do not double count items reported as both unrecaptured Section 1250 gains on Schedule K-1-P, Line 28, and as Section 1231 gains on Schedule K-1-P, Line 30. You may include any capital loss amounts on your Schedule NB only to the extent those loss amounts are included in your unmodified base income on Form IL-1065 or Form IL-1120-ST, Step 3, Line 13. Include the amounts in Step 4, Column B in the total amount you report on Step 6, Line 45, of your Form IL-1065 or Form IL-1120-ST. You may include any capital loss amounts on your Form IL-1065 or Form IL-1120-ST, Step 6, Line 45, only to the extent those loss amounts are included in your unmodified base income on Form IL-1065 or Form IL-1120-ST, Step 3, Line 13. Step 5 - Your share of Illinois additions and subtractions — Column A - Member’s share of additions and subtractions — Lines 32 through 37 - The amounts on these lines are reported in your Illinois base income by including them on Step 4, Line 19, of your Form IL-1065 or IL-1120-ST. Lines 38a, 38b, and 44 through 47 - The amounts on these lines are reported in your Illinois base income by including the total of these lines on Step 5, Line 32, of your Form IL-1065 or Form IL-1120-ST. Line 39 - Include the amount from Line 39 on your Schedule 1299-A, Tax Subtractions and Credits (for partnerships and S corporations), Step 1, Line 2. Line 40 - Include the amount from Line 40 on your Schedule 1299-A, Step 1, Line 5. Line 41 - Include the amount from Line 41 on your Schedule 1299-A, Step 1, Line 8.* Line 42 - Include the amount from Line 42 on your Schedule 1299-A, Step 1, Line 11.* Line 43 - Include the amount from Line 43 on your Schedule 1299-A, Step 1, Line 14.* *Partnerships filing Form IL-1065 are not eligible for these subtractions. In addition, report the business and nonbusiness amounts in Column A, Lines 32 through 47 as indicated in the following instructions. Schedule K-1-P(2) (R-05/22)Page 10 of 13 Step-by-Step Instructions for Step 7 - Your share of the Illinois credits, recapture, pass-through withholding, PTE tax credit, and federal income subject to surcharge You may include any capital loss amounts on your Form IL-990-T, Step 3, Line 4, only to the extent those loss amounts are included in your unrelated business taxable income. Include the amounts in Step 4, Column B in the total amount you report on your Form IL-990-T, Step 3, Line 10. You may include any capital loss amounts on your Form IL-990-T, Step 3, Line 10, only to the extent those loss amounts are included in your unrelated business taxable income. Step 5 - Your share of Illinois additions and subtractions — Column A - Member’s share of business amounts — Lines 32 through 47 (excluding Line 38b) - Enter the total of any business amounts from Lines 32 through 37 and 38a through 47 (excluding Line 38b), Column A. A Total of business amounts from Lines 32 through 37, Column A. ______________ B Total of business amounts from Lines 38a through 47 (excluding Line 38b), Column A. ______________ C Subtract Line B from Line A. ______________ Include the total amount from Line C in the total amount reported on Step 3, Line 4, of your Form IL-990-T. Column B - Illinois share of business amounts — Lines 32 through 47 (excluding Line 38b) - Enter the total of any business amounts from Lines 32 through 37 and 38a through 47 (excluding Line 38b), Column B. A Total of business amounts from Lines 32 through 37, Column B. ______________ B Total of business amounts from Lines 38a through 47 (excluding Line 38b), Column B. ______________ C Subtract Line B from Line A. ______________ Include the total amount from Line C in the total amount reported on Step 3, Line 10, of your Form IL-990-T. Step 7 - Your share of Illinois credits, recapture, pass-through withholding payments, PTE tax credit, and federal income subject to surcharge — If the partnership or S corporation has passed through to you any credit, recapture amounts, income tax payments made on your behalf, or federal income subject to surcharge on Lines 52a through 57, see the specific instructions for Step 7 at the end of these instructions for more information. Line 52 - Illinois Income Tax Credits — For each Line 52a through 52u that has an amount listed in Step 7 of Schedule K-1-P, enter, on your Schedule 1299, the corresponding Credit Code and the amount of Distributive Share of Credit from Schedule K-1-P. See your Schedule 1299 Instructions for details. Attach Schedule K-1-P to your Schedule 1299. Use the chart on Page 11 to complete your Schedule 1299. For tax years ending on or after December 31, 2000, partnerships and S corporations automatically pass these credits through to their partners or shareholders that are subject to replacement tax. The following income tax credits are available for partnerships and S corporations to pass through to you: Line 52a - Film Production Services Line 52b - Enterprise Zone Investment Line 52c - Enterprise Zone Construction Jobs Line 52d - High Impact Business Construction Jobs Line 52e - Affordable Housing Donations Line 52f - Economic Development for a Growing Economy (EDGE) Line 52g - New Construction EDGE Line 52h - Research and Development Line 52i - Wages paid to Ex-Felons Line 52j - Student-Assistance Contribution Line 52k - Angel Investment Line 52l - New Markets Development Line 52m - River Edge Historic Preservation Line 52n - River Edge Construction Jobs Line 52o - Live Theater Production Line 52p - Hospital Line 52q - Invest in Kids Line 52r - Data Center Construction Employment Line 52s - Apprenticeship Education Expense Line 52t - Historic Preservation Line 52u - Other income tax credits, including the Reimagining Electric Vehicles (REV) Illinois Investment credit and Agritourism Liability Insurance tax credit. Line 53a — PTE tax credit — If the partnership or S corporation distributed PTE tax credit to you, include the amount on • Individuals — Form IL-1040, Step 8, Line 28. • Trusts or Estates — • Form IL-1041, Line 55d, if the PTE tax credit amount is retained by the fiduciary. • Schedule K-1-T, Line 50, if the PTE tax credit amount is distributed to your beneficiaries. • Partnerships or S corporations — each partner’s or shareholder’s Schedule K-1-P, Line 53a. Enter that partner’s or shareholder’s distributive share. • Corporations — Form IL-1120, Line 61d. • Exempt organizations — Form IL-990-T, Line 29d. The credit on Line 53a is allowed against the tax imposed on Schedule K-1-P(2) (R-05/22)Page 11 of 13 the member under IITA subsections 201(a) and (b). A nonresident individual member of a partnership or S corporation for a tax year in which the election to pay PTE tax was made shall not be required to file an income tax return under the IITA for such taxable year if the only source of net income of the individual (or the individual and the individual’s spouse in the case of a joint return) is from an entity making the PTE election and the credit allowed to the member equals or exceeds the individual’s liability for the tax imposed under subsections (a) and (b) of Section 201 of the IITA for the tax year. Line 53b — Enter this amount on Form IL-477, Line 4. Lines 54a, 54b, and 54c — Recapture — Your share of recapture is based on your share of the original investment credit. • If you shared in the original credit and you are no longer a partner or shareholder of the partnership or the S corporation in the year of recapture, Lines 54a, 54b, and 54c will be the only lines completed on this schedule. • If your share in the year of the original investment credit is different from your share in the year of the recapture, Lines 54a, 54b, and 54c will be completed and the partnership or the S corporation will attach a sheet explaining the difference. If recapture is reported to you for a particular investment credit, and you claimed the corresponding credit against your Illinois income or replacement tax liability in a previous year, you must file a completed Illinois Income Tax return including Schedule 4255. Include the total amount from • Schedule K-1-P Lines 54a and 54b on Schedule 4255, Step 4, Line 15, and • Schedule K-1-P Line 54c on Schedule 4255 Step 5, Line 20. Line 55 — If the partnership or S corporation made income tax payments on your behalf, include the amount on your • Form IL-1040, Step 8, Line 27, • Form IL-1041, Step 7, Line 55c, • Form IL-1065, Step 9, Line 65c, • Form IL-1120-ST, Step 9, Line 65c, • Form IL-1120, Step 8, Line 61c, or • Form IL-990-T Step 6, Line 29c. Schedule K-1-P, Step 1, Line 3, must be completed or the pass-through withholding reported on this line may not be credited to your return. Individuals, trusts, estates, partnerships, and corporations (including S corporations) only - Pass- through withholding payments made on your behalf and reported to you on Schedule K-1-P, Line 55, are based on items of business income and certain items of nonbusiness income only. If you had Illinois income from other sources and the payments made on your behalf do not cover your liability, you must file a return to report the tax on all of your Illinois income and claim a credit for pass-through withholding payments made on your behalf. Line 56 — This is your share of taxable gains attributable to transactions subject to the Compassionate Use of Medical Enter the amount from Schedule K-1-P, Step 7, Line Individuals: on Schedule 1299-C, Step 3 Trusts/Estates/Corporations/ Exempt Organizations: on Schedule 1299-D, Step 3 Partnerships/S corporations: on Schedule 1299-A, Step 3 52a Film Production Services 5000 5000 5000 52b Enterprise Zone Investment 5080 5080 5080 52c Enterprise Zone Construction Jobs 5120 5120 5120 52d High Impact Business Construction Jobs 5160 5160 5160 52e Affordable Housing Donations 5260 5260 5260 52f EDGE 5300 5300 5300 52g New Construction EDGE 5320 5320 5320 52h Research and Development 5340 5340 5340 52i Wages paid to Ex-Felons 5380 5380 5380 52j Student-Assistance Contribution 5420 5420 5420 52k Angel Investment 5460 5460 5460 52l New Markets Development 5500 5500 5500 52m River Edge Historic Preservation 5540 5540 5540 52n River Edge Construction Jobs 5560 5560 5560 52o Live Theater Production 5580 5580 5580 52p Hospital 5620 5620 5620 52q Invest in Kids 5660 5660 5660 52r Data Center Construction Employment 5820 5820 5820 52s Apprenticeship Education Expense 0160 0160 0160 52t Historic Preservation 1030 1030 1030 52u Other Income Tax Credits REV Illinois Investment Agritourism Liability Insurance n/a 5230 5440 n/a 5230 5440 n/a 5230 5440 Schedule K-1-P(2) (R-05/22)Page 12 of 13 Cannabis Program Act surcharge. Use this information when calculating the surcharge on your return. See the following instructions and the instructions for the return you are filing for more information. Definitions related to the surcharge — Organization registrant means a corporation, partnership, trust, limited liability company (LLC), or other organization that holds either a medical cannabis cultivation center registration issued by the Illinois Department of Agriculture or a medical cannabis dispensary registration issued by the Illinois Department of Financial and Professional Regulation. Transactions subject to the surcharge means sales and exchanges of • capital assets; • depreciable business property; • real property used in the trade or business; and • Section 197 intangibles of an organization registrant. What is the surcharge? For each taxable year beginning or ending during the Compassionate Use of Medical Cannabis Program, a surcharge is imposed on all taxpayers on income arising from the transactions subject to the surcharge of an organization registrant under the Compassionate Use of Medical Cannabis Program Act. The amount of the surcharge is equal to the amount of federal income tax liability for the taxable year attributable to the transactions subject to the surcharge. To whom does the surcharge apply? The surcharge is imposed on any taxpayer who incurs a federal income tax liability on the income realized on a “transaction subject to the surcharge,” including individuals and other taxpayers who are not themselves the “organization registrant” that engaged in the transaction. A partner or shareholder who incurs a federal income tax liability on income from a transaction subject to surcharge passed through from a partnership or S corporation will incur a surcharge. Although a unitary business group filing combined Illinois returns is treated as a single taxpayer and its members are jointly and severally liable for any surcharge imposed on the group, the group itself is not an organization registrant and transactions of any member that is not itself an organization registrant are not subject to the surcharge. How do I use the amount reported on Line 56? The amount reported on Line 56 identifies your share of any taxable gains attributable to transactions subject to the surcharge. The partnership and S corporation listed in Step 1 should have also provided you with a breakdown itemizing any amount reported on Line 56. Use this information when completing the “Surcharge Worksheet” found in the Form IL-1120 Instructions. Line 56 identifies taxable gains attributable to transactions subject to the surcharge that should not be included when you complete Line 2 of the worksheet. The amount on Line 56 identifies taxable gains attributable to transactions subject to the surcharge, not federal income tax liability for the taxable year attributable to the transactions subject to the surcharge. Exclude this income before figuring the federal income tax amount on Line 2 of the worksheet. For more information, see 86 Ill. Adm. Code Section 100.2060. Line 57 — This is your share of taxable gains attributable to transactions subject to the surcharge on the sale of assets by gaming licensee. Use this information when calculating the surcharge on your return. See the instructions below and the instructions for the return you are filing for more information. Definitions related to the surcharge — Gaming licensee is an organization licensee under the Illinois Horse Racing Act of 1975 and/or an organization gaming licensee under the Illinois Gambling Act. Transactions subject to the surcharge means sales and exchanges of • capital assets; • depreciable business property; • real property used in the trade or business; and • Section 197 intangibles of a gaming licensee. What is the surcharge? For each taxable year 2019 through 2027, a surcharge is imposed on all taxpayers on income arising from the transactions subject to the surcharge on the sale of assets by gaming licensee. The amount of the surcharge is equal to the amount of federal income tax liability for the taxable year attributable to the transactions subject to the surcharge. To whom does the surcharge apply? The surcharge is imposed on any taxpayer who incurs a federal income tax liability on the income realized on a “transaction subject to the surcharge,” including individuals and other taxpayers who are not themselves the “gaming licensee” that engaged in the transaction. The surcharge imposed shall not apply if • the organization gaming license, organization license, or racetrack property is transferred as a result of any of the following: • bankruptcy, a receivership, or a debt adjustment initiated by or against the initial licensee or the substantial owners of the initial licensee; • cancellation, revocation, or termination of any such license by the Illinois Gaming Board or the Illinois Racing Board; • a determination by the Illinois Gaming Board that transfer of the license is in the best interests of Illinois gaming; • the death of an owner of the equity interest in a licensee; • acquisition of a controlling interest in the stock or substantially all of the assets of a publicly traded company;