Illinois Nonbusiness Income

Nonbusiness Income
Schedule NB
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Illinois Department of Revenue		

Schedule NB	 Nonbusiness Income	
Attach to your Form IL-1120, IL-1120-ST, or IL-1065.	

Write your name as shown on your Form IL-1120, IL-1120-ST, or IL-1065. 	

		

	Year ending
	
Month	
Year
IL Attachment
No. 17
	

Write your federal employer identification no. (FEIN)

	

Read the instructions before completing this form.
					 	
						

Column A 		
Total everywhere		

Column B
Allocable to Illinois

	 1	 Interest*		 1	
	 2	 Dividends*	

	 2	

	 3	 Rental income	

	3	

	 4	 Patent royalties	

	4

	 5	 Copyright royalties	

	5

	 6	 Other royalty income	

	6

	 7	 Capital gain (loss) from real property	

	7

	 8	 Capital gain (loss) from tangible personal property	

	8

	 9	 Capital gain (loss) from intangible personal property	

	9

10	 Other (specify) 	

10

		

			

					
	
		

11	 Recaptured business expense (See instructions.)
		
		

You must complete the apportionment factor
worksheet below to get the correct figure for Column B. 	 11	

												
12	 Totals. Add Lines 1 through 11 for each column.	
12	
							

	 Apportionment factor worksheet (see instructions)
	 a	 Write your apportionment factor from two years ago (if applicable).	a	
	 b 	 Write your apportionment factor from last year’s tax return.			 b	
	 c 	 Write your apportionment factor from this year’s tax return.			 c	
	 d	 Add Lines a, b, and c.			 d	
	 e	 If you have an amount on Line a, divide Line d by 3.
			
If you do not have an amount on Line a, divide Line d by 2.			 e	
	 f	 Write the greater of Line c or Line e.
			
This is your apportionment factor.			 f	
	 g	 Multiply Column A, Line 11 by Line f, and write the result
			
here and in Column B, Line 11.			 g
*	Interest and dividends are allocable to Illinois if your commercial domicile
	 was in Illinois at the time the interest or dividend was paid or accrued. 	 	

Schedule NB front (R-12/12)

This form is authorized as outlined by the Illinois Income Tax Act. Disclosure of this
information is REQUIRED. Failure to provide information could result in a penalty.

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Schedule NB Instructions
Do not complete Schedule NB if you made the election to
treat all income as business income on your annual tax return.

•	

to the extent that the patent or copyright is used by the payer in a
state in which you are not taxable with respect to the royalties and,
at the time the royalties were paid or accrued, your commercial
domicile was in Illinois.

for partnerships and S corporations: Do not include
the portion of nonbusiness income or loss distributable to partners or
shareholders subject to replacement tax reported on Form IL-1065,
Lines 21 or 27, or Form IL-1120-ST, Lines 20 or 24.

A patent is used in a state to the extent that

Column A

•	

Lines 1 through 10 — Write in Column A on the appropriate line all

If the basis of, or receipts from, patent royalties do not permit allocation
to states or if the accounting procedures do not reflect states of use, the
patent is used in Illinois if your commercial domicile was in Illinois.

nonbusiness income, net of related expenses, wherever earned.

Line 11 — Recaptured business expense

•	

it is employed in production, fabrication, manufacturing, or other
processing in the state, or
a patented product is produced in the state.

If any of the income included in Lines 1 through 10 was earned from an
asset or activity which, in any prior tax year, produced business income,
write all of the expenses of that asset or activity that you deducted in the
current year and the two most recent tax years in Column A of Line 11.
Include this amount on Line 12 and on Illinois Schedule M, Other
Additions and Subtractions (for businesses), Step 2, Line 4.

A copyright is used in a state to the extent that printing or other
publication originates in the state. If the basis of, or receipts from,
copyright royalties do not permit allocation to states or if the accounting
procedures do not reflect states of use, the copyright is used in Illinois if
your commercial domicile was in Illinois.

Line 12 — Totals

Capital gains and losses resulting from the sale or exchange of property
are allocable to Illinois
	 •	 for real property if the real property is located in Illinois,
	 •	 for tangible personal property if at the time of the sale 	
	
	
or exchange the property had its situs in Illinois, or your 		
	
commercial domicile was in Illinois and you were not taxable 		
	
in the state in which the tangible personal property had 		
	
its situs, or

Add Lines 1 through 11 and write the amount from Column A, Line 12 on
	 •	 Form IL-1120, Line 24,
	 •	 Form IL-1120-ST, Line 36, or
	 •	 Form IL-1065, Line 36.

Column B — Of the amounts written in Column A, write in Column B
any amount allocable to Illinois as follows:
	 S corporations only: If you are a member of a unitary
business group include only your own items in Column B,
Lines 1 through 10. Do not include nonbusiness items of other members
of the unitary group.

Lines 1 and 2 — Net interest and dividends
If your commercial domicile was in Illinois when the interest and
dividends were paid or accrued, the interest and dividend income is
allocable to Illinois.

Line 3 — Rents and royalties
Rents and royalties from real property are allocable to Illinois if the
property is located in Illinois. Rents and royalties from tangible personal
property are allocable to Illinois
•	 to the extent that the property is used in Illinois, or
•	 in their entirety, if at the time the rents or royalties were paid or
accrued, your commercial domicile was in Illinois and you were not
organized under the laws of, or taxable with respect to the rents or
royalties in, the state in which the property was used.
The extent of use of tangible personal property in a state is determined
by multiplying the rents or royalties derived from the property by a
fraction, where the
•	 numerator is the number of days of physical location of the property
in the state during the rental or royalty period in the taxable year, and
•	 the denominator is the number of days of physical location of the
property everywhere during all rental or royalty periods in the taxable
year.
If the physical location of the property during the rental or royalty period
is unknown or unascertainable, tangible personal property is used in the
state in which the property was located at the time the rental or royalty
payer obtained possession.

Lines 4, 5, and 6 — Patent, copyright, and other royalties

Lines 7, 8, and 9 — Capital gains and losses

	 •	
	

for intangible personal property if your commercial domicile 	
was in Illinois at the time of the sale or the exchange.

	

Line 11 — Recaptured business expense
You must complete the apportionment factor worksheet to figure
the correct amount for Line 11.
Multiply the amount in Column A by the amount on the apportionment
factor worksheet, Line f.

Apportionment factor worksheet
Follow the instructions on the form.
The apportionment factor should be the greater of:
	 •	 the apportionment factor from this year’s tax return, Form
			
— IL-1120, Line 30,
			
— IL-1120-ST, Line 42, or
			
— IL-1065, Line 42.
	 •	 the total of the apportionment factor on your Form
			
— IL-1120, Line 30, 		
	
— IL-1120-ST, Line 42, or
			
— IL-1065, Line 42.
			
for this year, plus the apportionment factors from the tax return 		
	
you filed for the two most recent tax years, prior to this year, 		
	
divided by “3”.
If you filed a tax return for only one tax year prior to this year, add the
apportionment factor from that return to the apportionment factor from the
current year return and divide the total by “2”.

Line 12 — Add Lines 1 through 11, and write the amount from
Column B, Line 12 on Form
	 •	 IL-1120, Line 32,
	 •	 IL-1120-ST, Line 44, or
	 •	 IL-1065, Line 44.

Patent and copyright royalties are allocable to Illinois
•	 to the extent that the patent or copyright is used by the payer in
Illinois, or
Schedule NB back (R-12/12)