Kentucky Tax Computation Schedule for a IEIA Project of a Pass-Through Entity

Tax Computation Schedule for a IEIA Project of a Pass-Through Entity
Schedule IEIA-SP
*1600010326*

SCHEDULE IEIA–SP
41A720–S52 (10–16)
Commonwealth of Kentucky
DEPARTMENT OF REVENUE

Taxable Year Ending

	
	

__ __ / __ __
Mo.

Yr.  

TAX COMPUTATION SCHEDULE
(FOR AN IEIA PROJECT OF A PASS–THROUGH ENTITY)

➤	 See instructions.

KRS 154.27–010 to 100

➤	 Attach to Form 720S, 765 or 765–GP.

Name of Pass-through Entity	
Federal Identification Number	
Kentucky Corporation/LLET		
	
		
Account Number
		

__ __ __ __ __ __ __ __ __

Location of Project	
	
	

Activation Date of IEIA 	
Incentive Agreement 	

Economic Development
Project Number

 /     / 	

	
City	

__ __ __ __ __ __

County		
	 Mo.	
Day
Yr.

PART I—Computation of IEIA Tax Credit and Tax Due
  1.	
  2.	
  3.	
	
  4.	

Kentucky taxable income on IEIA project (see instructions)............................................................. 	
Net operating loss deduction on IEIA project.................................................................................... 	
Kentucky taxable income on IEIA project after net operating loss deduction
(line 1 less line 2).................................................................................................................................. 	
Income tax on amount from line 3:

	

Taxable Net Income	

	
(a)	 First $3,000......................... 	
	
(b)	 Next $1,000......................... 	
	
(c)	 Next $1,000......................... 	
	
(d)	 Next $3,000......................... 	
	(e)	
Over $8,000 up to $75,000. 	
	(f)	
Over $75,000....................... 	
	

Rate	

1			 00
2	(	
)	 00
3		

00

Tax

x	2%	
x	3%	
x	4%	
x	5%	
x	5.8%	
x	6%	

00
00
00
00
00
00

(g)	 Total income tax liability of IEIA project (add lines 4(a) through 4(f))...................................... 	4(g)	

00

  5.	 LLET on IEIA project (see instructions). Not applicable for Form 765–GP....................................... 	5	
  6.	 LLET credit allowed (line 5 less $175, but not more than line 4(g)). Not applicable for
	
Form 765–GP......................................................................................................................................... 	6	
  7.	 Total tax on IEIA project (lines 4(g) and 5 less line 6)........................................................................ 	7	
  8.	 Limitation (Column C from Schedule IEIA-T)..................................................................................... 	8	
  9.	 Enter the lesser of line 7 or line 8 as either:
	
(a)	 IEIA tax credit................................................................................................................................. 	9(a)	
		or
	
(b)	 Estimated tax payment and complete election in Part II............................................................ 	9(b)	
10.	 If line 7 is larger than line 9(a) or 9(b), enter difference here as a liability of the
	
pass–through entity. (Any pass–through entity reflecting a tax liability, complete
	
Tax Payment Summary below and remit payment.)......................................................................... 	10	

00
00
00
00
00
00

00

PART II—Estimated Tax Election
In accordance with KRS 141.421(4)(b),
Name of Pass–through Entity

elects for the taxable year ended	

, in lieu of the IEIA tax credit, to have an amount equal

to the lesser of line 7 or line 8 above applied as an estimated tax payment.
➤
Signature of Shareholder, Partner or Member		

TAX PAYMENT SUMMARY (Make check payable to Kentucky State Treasurer.)
Tax	 Interest	Penalty	TOTAL

Date

	

41A720–S52 (10–16)

Commonwealth of Kentucky
DEPARTMENT OF REVENUE

INSTRUCTIONS–SCHEDULE IEIA–SP

PURPOSE OF SCHEDULE—This schedule is used by
any pass–through entity which has entered into a
tax incentive agreement for an Incentives for Energy
Independence Act (IEIA) project to determine the
credit allowed against the Kentucky income tax and
LLET in accordance with KRS 141.421 on the income
and Kentucky gross receipts or Kentucky gross profits
from the project.
Pass–through entities should first complete Form
720S, 765 or 765–GP to determine net income (loss),
deductions, etc., from the entire operations of the
pass–through entity. The pass–through entity should
then complete Schedule IEIA–SP to determine the IEIA
tax credit and the tax due, if any, from the IEIA project.
A pass–through entity is subject to tax as provided
by KRS 141.020 and KRS 141.0401 on the net income
and the Kentucky gross receipts or Kentucky gross
profits from the project and the IEIA credit is applied
against the tax of the IEIA project. Consequently,
the pass–through entity must use Form 720S(K),
Form 765(K) or Form 765–GP(K) in lieu of Schedule
K (Form 720S), Schedule K (Form 765) or Schedule
K (Form 765–GP) in order to exclude the net income
from the IEIA project from the partners, members or
shareholders’ distributive share income, and Schedule
LLET(K) in lieu of Schedule LLET in order to exclude the
Kentucky gross receipts or the Kentucky gross profits
of the IEIA project from the LLET at the entity level.
Multiple Projects—A pass–through entity with multiple
economic development projects must complete an
applicable schedule (Schedule KREDA–SP, Schedule
KIDA–SP, Schedule KEOZ–SP, Schedule KJRA–SP,
Schedule KIRA–SP, Schedule KJDA–SP, Schedule
KBI–SP, Schedule KRA–SP or Schedule IEIA–SP) to
determine the credit and net tax liability, if any, for
each project.
Line 1—If the pass–through entity’s only operation is
the IEIA project, the amount entered on Line 1 is the
net income (loss) from Form 720S, 765 or 765–GP. If
the pass–through entity has operations other than the
IEIA project, a schedule must be attached reflecting
the computation of the net income (loss) from the IEIA
project in accordance with the following instructions,
and such amount entered on Line 1.
Separate Facility—In accordance with KRS 141.421(6),
if the project is a totally separate facility, net income,
Kentucky gross receipts, and Kentucky gross profits
attributable to the project shall be determined by a
separate accounting method.
Alternative Methods—In accordance with KRS 141.421(7),
if the approved company can show that the nature of the

Page 2

operations and activities of the approved company are
such that it is not practical to use a separate accounting
method to determine the net income, Kentucky gross
receipts and Kentucky gross profits from the facility at
which the economic development project is located,
the approved company shall use an alternative method
approved by the Department of Revenue. A copy of
the letter from the Department of Revenue approving
the alternative method must be attached to this
schedule.
Separate Accounting—If the economic development
project is a totally separate facility, net income shall
reflect only the gross income, deductions, expenses,
gains and losses allowed under this chapter directly
attributable to the facility and overhead expenses
apportioned to the facility; and Kentucky gross receipts
or Kentucky gross profits shall reflect only Kentucky
gross receipts or Kentucky gross profits directly
attributable to the facility.
Line 2—Enter the net operating loss from the IEIA project,
if any, being carried forward from previous years.
Note: Just as the income from a IEIA project does not
flow through to partners, members or shareholders,
neither do the losses. The project’s net operating loss
from prior years must be subtracted from the project
income before calculating the IEIA credit.
General Partnership—Lines 5 and 6 of this schedule
shall not be completed by a general partnership as a
general partnership is not subject to LLET.
Line 5—Using Schedule LLET, create a new Schedule
LLET to compute the LLET of the IEIA project using
only the Kentucky gross receipts and Kentucky gross
profits of the project. Enter “IEIA” at the top center of
the Schedule LLET and attach it to the tax return.
Line 9—In lieu of the tax credit, the approved
company may elect, on an annual basis, to apply as
an estimated tax payment an amount equal to the
allowable tax credit. Any estimated tax payment shall
be in satisfaction of the tax liability of the partners,
members or shareholders of the pass–through entity,
and shall be paid on behalf of the partners, members
or shareholders. Enter an amount on either (a) or (b),
but in no case shall there be an entry on both (a) and
(b). In accordance with KRS 141.421(5), this estimated
tax payment is excluded in determining each partner,
member or shareholder’s distributive share income
or credit from a pass–through entity. Accordingly, the
partners, members or shareholders are not entitled
to claim any portion of this estimated tax payment
against their Kentucky income tax liability.