| (1) |
Subject to the other provisions of this part, a pass-through entity taxpayer is subject to taxation:
Terms Used In Utah Code 59-10-1403.1- C corporation: means the same as that term is defined in Section 1361, Internal Revenue Code. See Utah Code 59-10-1402
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Corporation: includes :
| (ii) | a joint stock company; and |
| (iii) | an insurance company. See Utah Code 59-10-103- Individual: means a natural person and includes aliens and minors. See Utah Code 59-10-103
- nonresident estate: means a trust or estate which is not a resident estate or trust. See Utah Code 59-10-103
- Nonresident individual: means an individual who is not a resident of this state. See Utah Code 59-10-103
- Nonresident pass-through entity taxpayer: means a pass-through entity taxpayer that is a:
| (a) | nonresident individual; or |
| (b) | nonresident business entity. See Utah Code 59-10-1402- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Partnership: includes a syndicate, group, pool, joint venture, or other unincorporated organization:
| (A) | through or by means of which any business, financial operation, or venture is carried on; and |
| (B) | that is not, within the meaning of this chapter, a trust, an estate, or a corporation. See Utah Code 59-10-103- Pass-through entity: means a business entity that is:
| (a) | the following if classified as a partnership for federal income tax purposes:| (i) | a general partnership; |
| (ii) | a limited liability company; |
| (iii) | a limited liability partnership; or |
| (iv) | a limited partnership; |
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| (c) | an estate or trust with respect to which the estate's or trust's income, gain, loss, deduction, or credit is divided among and passed through to one or more pass-through entity taxpayers; or |
| (d) | a business entity similar to Subsections (11)(a) through (c):| (i) | with respect to which the business entity's income, gain, loss, deduction, or credit is divided among and passed through to one or more pass-through entity taxpayers; and |
| (ii) | as defined by the commission by rule made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act. See Utah Code 59-10-1402- Pass-through entity taxpayer: means a resident or nonresident individual, a resident or nonresident business entity, or a resident or nonresident estate or trust:
| (a) | that is:| (i) | for a general partnership, a partner; |
| (ii) | for a limited liability company, a member; |
| (iii) | for a limited liability partnership, a partner; |
| (iv) | for a limited partnership, a partner; |
| (v) | for an S corporation, a shareholder; |
| (vi) | for an estate or trust described in Subsection(11)(c), a beneficiary; or |
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| (b) | to which the income, gain, loss, deduction, or credit of a pass-through entity is passed through. See Utah Code 59-10-1402- Resident individual: means an individual who is domiciled in this state for any period of time during the taxable year, but only for the duration of the period during which the individual is domiciled in this state. See Utah Code 59-10-103
- Resident pass-through entity taxpayer: means a pass-through entity taxpayer that is a:
| (a) | resident individual; or |
| (b) | resident business entity. See Utah Code 59-10-1402- resident trust: means the same as that term is defined in Section 75-7-103. See Utah Code 59-10-103
- Return: means a return that a pass-through entity taxpayer files:
| (b) | for a pass-through entity taxpayer that is classified as an estate, individual, partnership, S corporation, or a trust for federal income tax purposes, under this chapter. See Utah Code 59-10-1402- S corporation: means the same as that term is defined in Section 1361, Internal Revenue Code. See Utah Code 59-10-1402
- State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
- Taxpayer: means any of the following that has income subject in whole or part to the tax imposed by this chapter:
| (ii) | an estate, a trust, or a beneficiary of an estate or a trust that is not a pass-through entity or a pass-through entity taxpayer; |
| (iii) | a pass-through entity; or |
| (iv) | a pass-through entity taxpayer. See Utah Code 59-10-103- Unadjusted income: means an amount equal to the difference between:
| (i) | the total income required to be reported by a resident or nonresident estate or trust on the resident or nonresident estate's or trust's federal income tax return for estates and trusts for the taxable year; and |
| (ii) | the sum of the following:| (A) | fees paid or incurred to the fiduciary of a resident or nonresident estate or trust:| (I) | for administering the resident or nonresident estate or trust; and |
| (II) | that the resident or nonresident estate or trust deducts as allowed on the resident or nonresident estate's or trust's federal income tax return for estates and trusts for the taxable year; |
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| (B) | the income distribution deduction that a resident or nonresident estate or trust deducts under Section 651 or 661, Internal Revenue Code, as allowed on the resident or nonresident estate's or trust's federal income tax return for estates and trusts for the taxable year; |
| (C) | the amount that a resident or nonresident estate or trust deducts as a deduction for estate tax or generation skipping transfer tax under Section 691(c), Internal Revenue Code, as allowed on the resident or nonresident estate's or trust's federal income tax return for estates and trusts for the taxable year; and |
| (D) | the amount that a resident or nonresident estate or trust deducts as a personal exemption under Section 642(b), Internal Revenue Code, as allowed on the resident or nonresident estate's or trust's federal income tax return for estates and trusts for the taxable year. See Utah Code 59-10-103 |
| (a) |
for a pass-through entity taxpayer that is classified as a C corporation for federal income tax purposes:
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| (b) |
for a pass-through entity taxpayer that is classified as an estate, individual, partnership, S corporation, or a trust for federal income tax purposes:
| (i) |
if that pass-through entity taxpayer is a resident pass-through entity taxpayer, as a resident estate, resident individual, resident partnership, resident S corporation, or resident trust is taxed under this chapter; or |
| (ii) |
if that pass-through entity taxpayer is a nonresident pass-through entity taxpayer, as a nonresident estate, nonresident individual, nonresident partnership, nonresident S corporation, or nonresident trust is taxed under this chapter. |
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| (2) |
A pass-through entity taxpayer is subject to taxation on the pass-through entity taxpayer’s share of income, gain, loss, deduction, or credit of the pass-through entity. |
| (3) |
| (a) |
Subject to Subsection (3)(b)(iii), a resident pass-through entity taxpayer shall file a return:
| (ii) |
if the resident pass-through entity taxpayer is classified as an estate, individual, partnership, S corporation, or a trust for federal income tax purposes, as a resident estate, resident individual, resident partnership, resident S corporation, or resident trust under this chapter. |
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| (b) |
| (i) |
Except as provided in Subsection (3)(b)(ii) and subject to Subsection (3)(b)(iii) or (iv), a nonresident pass-through entity taxpayer shall file a return:
| (B) |
if the nonresident pass-through entity taxpayer is classified as an estate, individual, partnership, S corporation, or a trust for federal income tax purposes, as a nonresident estate, nonresident individual, nonresident partnership, nonresident S corporation, or nonresident trust under this chapter. |
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| (ii) |
A nonresident pass-through entity taxpayer is not required to file a return if:
| (A) |
the nonresident pass-through entity taxpayer does not have:
| (I) |
for a nonresident pass-through entity taxpayer that is classified as a C corporation for federal income tax purposes, unadjusted income as defined in Section 59-7-101 derived from or connected with Utah sources, except for the nonresident pass-through entity taxpayer’s share of income, gain, loss, deduction, or credit of the pass-through entity; |
| (II) |
for a nonresident pass-through entity taxpayer that is classified as an individual, partnership, or S corporation for federal income tax purposes, adjusted gross income derived from or connected with Utah sources, except for the nonresident pass-through entity taxpayer’s share of income, gain, loss, deduction, or credit of the pass-through entity; or |
| (III) |
for a nonresident pass-through entity taxpayer that is classified as an estate or a trust for federal income tax purposes, unadjusted income as defined in Section 59-10-103 derived from or connected with Utah sources, except for the nonresident pass-through entity taxpayer’s share of income, gain, loss, deduction, or credit of the pass-through entity; |
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| (B) |
the nonresident pass-through entity taxpayer does not seek to claim a tax credit allowed against a tax imposed under:
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| (C) |
the pass-through entity pays or withholds a tax on behalf of the nonresident pass-through entity taxpayer and remits that tax to the commission:
| (II) |
if a nonresident pass-through entity taxpayer is classified as a C corporation for federal income tax purposes, in an amount that is equal to or greater than the minimum tax under Section 59-7-104; and |
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| (D) |
the nonresident pass-through entity taxpayer is not a member of a unitary group as defined in Section 59-7-101 that is required to file a return in this state. |
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| (iii) |
A nonresident pass-through entity taxpayer that is not otherwise required to file a return under this Subsection (3) may file a return under:
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| (iv) |
In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the commission may make rules for a pass-through entity taxpayer, except for a pass-through entity taxpayer who is a resident individual, to file a return under this section if two or more pass-through entities pay or withhold a tax in accordance with Section 59-10-1403.2 on behalf of the pass-through entity taxpayer. |
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Enacted by Chapter 312, 2009 General Session
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