Missouri Corporation Allocation and Apportionment of Income Schedule and Instructions

Corporation Allocation and Apportionment of Income Schedule and Instructions
MO-MS 2022 Corporation Allocation and Apportionment of Income Schedule
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2023 Corporation Allocation and
Apportionment of Income Schedule
Taxable Year

Attach to Form MO-1120 and mail to
the Missouri Department of Revenue.

Attachment Sequence No. 1120-01

Beginning

Ending

(MM/DD/YY)

(MM/DD/YY)

Missouri Tax

Do not complete this form if all income is from Missouri sources.

I.D. Number
Federal Employer

Charter

I.D. Number

Number

Corporation
Name

Select a box below and enter the method and the percentage calculated on Form MO-1120 for Line 9 Method and Percent.

Apportionment Election

Two A - Receipts Factor Apportionment - Section 143.455.2, RSMo - (Complete Part 1)
Special Methods - See Instructions and Attach Detailed Explanation (if directed).
Three - Transportation				

Four - Railroad

Five - Interstate Bridge 	

Six - Telephone and Telegraph

	

	

Note: Complete mileage information below for Method Three - Six and enter the percentage on Form MO-1120, Line 9.
	

Missouri Miles	

Total Miles	

÷

Percent

=

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%

Seven - Broadcasters or Other Approved Method – See Instructions and attach a detailed explanation (instructions).

For use with Method Two A or as directed by instructions.

	 1.	Amount of receipts in Missouri ........................................................................................................

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	 2.	Amount of receipts everywhere.......................................................................................................

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00

	 3.	Receipts Factor - Divide Line 1 by Line 2..............................................................................................

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%

Part 1

Note: Stop here unless you have either Nonapportionable Income or a Net Operating Loss on Federal Form 1120, Line 29A or both.
Enter Line 3 on Form MO-1120, Line 9 Percent.

	 4.	Taxable Income - All Sources (Form MO-1120, Line 8)..................................................................

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00

	 5.	Net Operating Loss (from Federal Form 1120, Line 29a)................................................................

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00

	 6.	Taxable Income - All Sources - Add Line 4 and Line 5....................................................................

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00

7. Nonapportionable Income - Everywhere - Attach a detailed Form MO-NAI to be considered.......

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00

	8. Apportioned Missouri Income - Subtract Line 7 from Line 6, then multiply by Line 3......................

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00

	 9.	Nonapportionable Income - Missouri-allocated - Attach a detailed Form MO-NAI to be considered

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	10.	Apportioned Net Operating Loss - See Instructions........................................................................

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00

11.	Preliminary Missouri Taxable Income - Add Lines 8 and 9, then subtract Line 10..........................

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	12.	Divide Line 11 by Line 4. Enter on Form MO-1120, Line 9 Percent.....................................................

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%

Form MO-MS (Revised 12-2023)

Balance Due:	
P.O. Box 3365	
Jefferson City, MO 65105-3365	

Refund or No Amount Due:
P.O. Box 700
Jefferson City, MO 65105-0700

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FORM MO-MS INSTRUCTIONS

Items of nonapportionable income may be reported on Form MO-MS
or Form MO-NAI only to the extent such items are included in Form
MO-1120, Line 8 (Taxable Income – All Sources). For example, an item
of nonapportionable income that was added on Form MO-1120, Line
3, would also be reported on Form MO-MS and Form MO-NAI. If all
or part of an item of nonapportionable income was subtracted on
Form MO-1120, Line 5, do not report the amount of nonapportionable
income so subtracted on Form MO-MS or Form MO-NAI.

This information is for guidance only and does not state the
complete law.

GENERAL INSTRUCTIONS
Complete the Form MO-MS if taxable corporation income is not 100
percent from Missouri sources. This form must be completed even if
Missouri taxable corporation income is zero. If the corporation owns a
percentage of a partnership(s), the partnership factors must be
multiplied by the corporation’s percentage of ownership, and then
added into the corporation’s apportionment factors. All taxpayers that
do not qualify for a Special Method (Methods Three through Seven)
must choose Method Two A - Receipts Factor Apportionment.

APPORTIONABLE AND NONAPPORTIONABLE
INCOME DEFINED
“Apportionable income” means all income that is apportionable
under the Constitution of the United States and is not allocated
under the laws of this state. Apportionable income includes, but
is not limited to, income arising from transactions and activity
in the regular course of the corporation’s trade or business.
Apportionable income also includes, but is not limited to, income
arising from tangible and intangible property if the acquisition,
management, employment, development, or disposition of the
property is or was related to the operation of the corporation’s
trade or business. “Nonapportionable income” means all income
other than apportionable income. The classification of income by
the labels customarily given them, such as interest, dividends, rents,
and royalties, is not conclusive in determining whether the income
is apportionable or nonapportionable income. Nonapportionable
income will be considered only if a detailed Form MO-NAI is
completed and attached.

APPORTIONMENT ELECTION
Missouri statutes provide a number of methods for determining
Missouri taxable income from Missouri sources. Choose only the
appropriate one of the listed methods and enter the method number
on Form MO-1120, Line 9 Method. Once an election has been made, it
cannot be changed with respect to the same taxable period.

METHOD TWO A
Receipts Factor Apportionment — Section 143.455.2, RSMo. See
instructions for completing Method Two A.

METHOD THREE
Transportation — Section 143.455.14, RSMo.

TAXABLE IN ANOTHER STATE

METHOD FOUR

A taxpayer is “taxable in another state” if it meets either one of two
tests:

Railroad — Section 143.455.15, RSMo.

METHOD FIVE

(a) if by reason of business activity in another state the taxpayer
is subject to one of these taxes: a net income tax, a franchise tax
measured by net income, a franchise tax for the privilege of doing
business, or a corporate stock tax; or

Interstate Bridge — Section 143.455.16, RSMo.

METHOD SIX
Telephone and Telegraph — Section 143.455.17, RSMo.

(b) if another state has jurisdiction to subject the taxpayer to a net
income tax, regardless of whether or not that state imposes such a
tax on the taxpayer.

METHOD SEVEN
This method can be used only with prior approval from the
Missouri Director of Revenue or pursuant to a Missouri regulation
creating an alternative industry-specific method under Section
143.455.13(1), RSMo.

The first test is applicable only if a taxpayer carries on business
activities in another state. If the taxpayer voluntarily files and pays
one or more of such taxes when not required to do so by the laws
of that state or pays a minimal fee for qualification, organization, or
for the privilege of doing business in that state, but:

Receipts Factor Apportionment Instructions - Step 1

(a) does not actually engage in business activities in that state; or

A taxpayer must have income from business activity taxable by this
state and at least one other state to apportion and allocate income.
Income from business activity includes apportionable and
nonapportionable income. The taxpayer’s income will be allocated
and apportioned according to Section 143.455. The taxpayer must
determine which portion of the taxpayer’s federal taxable income
constitutes “nonapportionable income.” The various items of
nonapportionable income are directly allocated to specific states,
which may include Missouri. The apportionable income of the taxpayer
is divided between states by using the receipts factor. The sum of
the items of nonapportionable income directly allocated to this state,
plus the amount of apportionable income attributable to this state by
the apportionment formula constitutes the amount of the taxpayer’s
Preliminary Missouri taxable income.

(b) does actually engage in some activity, not sufficient for nexus,
and the minimum tax bears no relation to the corporation’s
activities within such state, the taxpayer is not “taxable” in another
state.
The second test applies if the taxpayer’s business activities are
sufficient to give the state jurisdiction to impose a net income
tax under the Constitution and statutes of the United States.
Jurisdiction to tax is not present where the state is prohibited
from imposing the tax by reason of the provisions of Public Law
86-272, 15 U.S.C.A. Sections 381–385. If you believe you do not
have sufficient nexus and you are not liable for Missouri tax, you
may complete a Form 4458, Business Activity Questionnaire. For
Missouri forms access the Department of Revenue’s website at dor.
mo.gov.

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of intangible property. All other receipts from a sale of intangible
property shall be excluded from both the numerator and the
denominator of the receipts factor.

LINES 1, 2, AND 3 - RECEIPTS FACTOR
Complete Part 1, Lines 1 through 3.

If the state or states to which to assign receipts cannot be
determined, the state or states of assignment must be reasonably
approximated and you must attach a detailed statement explaining
the basis of the reasonable approximation.

•	The denominator of the receipts factor is generally all gross
receipts received by a taxpayer from transactions and activity
in the regular course of its trade or business. However, receipts
from hedging transactions or from the maturity, redemption,
sale, exchange, loan, or other disposition of cash or securities
(e.g. stocks, stock options, bonds) must not be included in
either the numerator or denominator of the receipts factor. The
numerator of the receipts factor is generally all gross receipts in
Missouri from transactions and activity in the regular course of
the taxpayer’s trade or business.

LINES 4 THROUGH 12 - ALLOCATION OF
NONAPPORTIONABLE INCOME
Complete Lines 4 through 12 if the taxpayer has either
nonapportionable income or a net operating loss on Federal Form
1120, Line 29a, or both.

•	Tangible Personal Property. Receipts from the sale of tangible
personal property are in this state if the property is received
in Missouri by the purchaser. Receipts from the rental, lease,
or license of tangible personal property are in this state to the
extent that the tangible personal property is located in Missouri.

Nonapportionable income will be considered only if a detailed
Form MO-NAI is completed and attached. In general, any income
arising from transactions and activity in the regular course of the
taxpayer’s trade or business, or any income arising from property
if the acquisition, management, employment, development, or
disposition of the property is or was related to the operation of the
taxpayer’s trade or business, will be apportionable income rather
than nonapportionable income

•	Real Property. Receipts from the sale, rental, lease, or license
of real property are in this state to the extent that the real
property is located in Missouri.
•	Services. Receipts from the sale of a service are in this state if
and to the extent that the ultimate beneficiary is in Missouri.
Generally, the ultimate beneficiary of the service (except for
bartering and similar in-kind transactions) is the entity that
receives benefit or value from, but does not also receive
monetary or credit-based payment in direct connection with,
the service at issue (other than refunds, cashback, or discountequivalents). In the event that the ultimate beneficiary is a
corporate or other entity that owns or operates in locations in
multiple states, and the extent to which the ultimate beneficiary
is located in Missouri cannot reasonably be determined, the
extent to which the ultimate beneficiary is located in Missouri
may be reasonably approximated as follows:

Rents and royalties from real or tangible personal property, capital
gains, interest, dividends, or patent or copyright royalties, are
presumed to be apportionable income unless the taxpayer clearly
demonstrates on Form MO-NAI that they are nonapportionable
income. To the extent one or more of these income items are
nonapportionable income, allocate such item(s) as follows:
(a) Net rents and royalties from real property located in this
state are allocable to this state.
(b) Net rents and royalties from tangible personal property are
allocable to this state: (1) if and to the extent that the
property is utilized in this state; or (2) in their entirety if
the taxpayer’s commercial domicile is in this state and the
taxpayer is not organized under the laws of, or taxable in,
the state in which the property is utilized. The extent of
utilization of tangible personal property in a state is
determined by multiplying the rents and royalties by a
fraction, the numerator of which is the number of days the 	
property was physically located in the state during the rental
or royalty period in the taxable year and the denominator of
which is the number of days of physical location of the 		
property everywhere during all royalty or rental periods
during the taxable year. If the physical location of the 		
property during the rental or royalty period is unknown or 	
unascertainable by the taxpayer, tangible personal property
is utilized in the state in which the property was located at 	
the time the rental or royalty payor obtained possession.

•	The ratio of the number of Missouri locations, which the 	
ultimate beneficiary owns or operates in, to the number of 	
such locations throughout the United States.
•	If the ratio above cannot reasonably be determined, then the 	
ratio of one to the number of states in which the ultimate 		
beneficiary operates.
•	If the ratio above cannot reasonably be determined, then use
fifty percent (50%). A taxpayer will not be subject to an addition
to tax for negligence in relying upon this approximation of fifty
percent (50%).

RENTAL, LEASE, OR LICENSE
OF INTANGIBLE PROPERTY
Receipts from the rental, lease, or license of intangible property
are in this state to the extent that the intangible property is used in
Missouri. Intangible property that is rented, leased, or licensed and
then used in this state in marketing a good or service to a consumer
is used in this state if the marketed good or service is purchased by a
consumer in this state. Franchise fees or franchise royalties received
for the rent, lease, license, or use of a trade name, trademark, service
mark, or franchise system, or the right to conduct business activity in
a specific geographic area, are receipts in this state to the extent that
the franchise is located in this state.

(c) Capital gains and losses from sales of real property located 	
in this state are allocable to this state.
(d) Capital gains and losses from sales of tangible personal 		
property are allocable to this state if: (1) the property had a 	
situs in this state at the time of the sale; or (2) the taxpayer’s
commercial domicile is in this state and the taxpayer is not 	
taxable in the state in which the property had a situs.
(e) Capital gains and losses from sales of intangible personal
property are allocable to this state if the taxpayer’s
commercial domicile is in this state.

SALE OF INTANGIBLE PROPERTY

(f) Interest and dividends are allocable to this state if the
taxpayer’s commercial domicile is in this state.

Receipts from the sale of intangible property are in this state to the
extent the intangible property is used in Missouri. If the
intangible property sold is a contract right, government license, or
similar property that authorizes the holder to conduct a business
activity in a specific geographic area, such intangible property is used
in Missouri if the geographic area includes all or part of Missouri. If
receipts from the intangible property sale is contingent on the
productivity, use, or disposition of the intangible property, these
receipts shall be treated as receipts from the rental, lease, or license

(g) Patent and copyright royalties are allocable to this state: (1)
if and to the extent that the patent or copyright is utilized by
the royalty payor in this state; or (2) if and to the extent that
the patent or copyright is utilized by the royalty payor ina
state in which the taxpayer is not taxable and the taxpayer’s
commercial domicile is in this state. A patent is utilized

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Method Seven Instructions

in a state to the extent that it is employed in production,
fabrication, manufacturing, or other processing in the state
or to the extent that a patented product is produced in the
state.
A copyright is utilized in a state to the extent that printing or
other publication originates in the state. If the basis of
receipts from patent royalties or copyright royalties does not
permit allocation to states or if the accounting procedures
do not reflect states of utilization, the patent or copyright
is utilized in the state in which the taxpayer’s commercial
domicile is located.

This method can only be used with prior approval from the Missouri
Director of Revenue or pursuant to a Missouri regulation creating an
alternative industry-specific method under Section 143.455.13(1),
RSMo. At latest sixty days before the close of the tax year to which
alternative apportionment is sought to apply, a taxpayer may file a
petition for alternative apportionment, following all requirements of
12 CSR 10-2.076 and section 143.455.13(2), RSMo, by emailing the
petition to [email protected]. Attach a detailed explanation
of how any allocation and apportionment was performed. Either
a letter of approval must be attached to the return or the detailed
explanation must identify the Missouri regulation that authorizes
the industry-specific method used and explain why the taxpayer
qualifies for the industry-specific method. The only industryspecific method currently allowed by Missouri regulation applies
to broadcasters under 12 CSR 10-2.260. Corporations defined as a
broadcaster under 12 CSR 10-2.260 must choose Method Seven.

Note: For allocation purposes, “commercial domicile” means the
principal place from which the trade or business of the taxpayer is
directed or managed.

LINE 10 - APPORTIONED NET OPERATING LOSS
Apportion the net operating loss by multiplying it by a ratio. The
numerator and the denominator of the ratio are both determined
without including the net operating loss deduction. The numerator of
the ratio is the Missouri Taxable Income calculated on Form MO-1120,
Line 13, with the amount of the net operating loss added back. The
denominator of the ratio is the Missouri Taxable Income calculated
as though all income, including all corporate dividends and all
nonapportionable income, was derived from Missouri sources, with
the amount of the net operating loss added back. Attach a detailed
schedule showing how you calculated this ratio. Multiply the ratio by
the net operating loss from MO-MS, Part 1, Line 5, and enter the result
on Form MO-MS, Part 1, Line 10. The ratio must not exceed 100%.

Complete Form MO-MS, Part 1, Lines 4 through 12 and enter the
resulting percentage from Form MO-MS, Part 1, Line 12 onto Form
MO-1120, Line 9 Percent. When completing Form MO-MS, Part
1, Line 3, substitute the appropriate apportionment percentage
(without taking into account allocation or NOL apportionment)
for the Receipts Factor. When completing Form MO-MS, Part 1,
Lines 7 and 9, enter income allocated (as opposed to apportioned)
everywhere and income allocated to Missouri, respectively, to the
extent that item is included in Taxable Income – All Sources (Form
MO-1120, Line 8). Include on the detailed explanation attachment
support for any allocation (as opposed to apportionment) of
income. Unless the approved method or Missouri regulation directs
otherwise, the Apportioned NOL entered on Form MO-MS, Part 1,
Line 11 must be determined in a manner consistent with Section
143.455.19, RSMo.

Method Three, Four, Five, or Six Instructions
Enter Missouri miles, total miles, and percentage in the Apportionment
Election section on Form MO-MS, Page 1, if applicable. Enter the
resulting mileage percentage on Form MO-MS, Part 1, Line 3 and
Form MO-1120, Line 9, unless required to complete Form MO-MS,
Part 1, Lines 4 through 12 as discussed below. If the mileage
percentage on Form MO-MS, Page 1, is inapplicable, attach a
detailed explanation of how apportionment and allocation was
performed.
If the mileage percentage on Form MO-MS, Page 1, is inapplicable,
or if the taxpayer utilizes any net operating loss for this tax year, or
if the taxpayer has included in Taxable Income - All Sources (Form
MO-1120, Line 8) any item of income to be allocated (as opposed
to apportioned), the taxpayer must complete Form MO-MS, Part 1,
Lines 4 through 12 and enter the resulting percentage from Form
MO-MS, Part 1, Line 12 onto Form MO-1120, Line 9 Percent. When
completing Form MO-MS, Part 1, Lines 7 and 9, enter income
allocated (as opposed to apportioned) everywhere and income
allocated to Missouri, respectively, to the extent they are items
included in Taxable Income – All Sources (Form MO-1120, Line
8). Attach a detailed explanation supporting any allocation (as
opposed to apportionment) of income.

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