New Hampshire Gross Business Profits Instructions

Gross Business Profits Instructions
dp-120-instructions-2022 Draft.pdf
1HZ+DPSVKLUH
'HSDUWPHQWRI
5HYHQXH$GPLQLVWUDWLRQ

2023
DP-120

SUB-CHAPTER S
CORPORATION
GENERAL INSTRUCTIONS

WHO MUST FILE
New Hampshire treats subchapter "S" corporations as if they were "C" corporations. Items of income and deductions are reported on Federal Form 1120S, Schedule K as
flow-through items to the shareholders. These instructions explain how Federal Schedule K amounts will be treated on the NH-1120 at the entity level.
FILE ONLY ONE FORM combining all S-Corp entities reporting as part of a combined return. Include a statement detailing each entity separately, similar to the
method used for consolidated federal pages.

CONFIDENTIAL INFORMATION
Tax information disclosed to the New Hampshire Department of Revenue Administration is held in strict confidence by law. The information may be disclosed to the
United States Internal Revenue Service, agencies responsible for the administration of taxes in other states in accordance with compacts for the exchange of
information, and as otherwise authorized by RSA 21-J:14.

TAXPAYER IDENTIFICATION
The Commissioner of the Department of Revenue is authorized pursuant to RSA 21-J:27-a to require submission of an SSN, FEIN, or any other identifying number used in
filing or preparing federal tax documents. If you do not have any such identifying number, or share one with another taxpayer, then, under N.H. Code of Admin. Rules,
Rev 2903.01, you must obtain a Department Identification Number (DIN). If you have a DIN, use it on all New Hampshire filings. To ensure that your filings and payments
are applied to the correct account, the sequence of names and taxpayer ID numbers on all filings must be consistent. The failure to provide a taxpayer identification
number may result in the rejection of filed documents. Failure to timely file documents complete with a consistent taxpayer identification number may result in the
imposition of penalties and interest, the disallowance of claimed exemptions, exclusions, credits, deductions, or an adjustment that may result in increased tax liability.

NEED FORMS?
To obtain additional forms, you may visit our website at www.revenue.nh.gov or call the Forms Line at (603) 230-5001.

NEED HELP?
Call the Department of Revenue Administration, Taxpayer Services at (603) 230-5920. Individuals with hearing or speech impairments may call TDD
Access: Relay NH 1-800-735-2964.

DP-120 Instructions 2023
Version 1 12/2023

Page 1 of 2

1HZ+DPSVKLUH
'HSDUWPHQWRI
5HYHQXH$GPLQLVWUDWLRQ

2023
DP-120

SUB-CHAPTER S
CORPORATION
LINE-BY-LINE INSTRUCTIONS

NAME AND TAXPAYER IDENTIFICATION NUMBER
Enter the business organization's name and taxpayer identification number [Social Security Number (SSN), Federal Employer Identification Number
(FEIN), or Department Identification Number (DIN)] in the spaces provided.
Enter the beginning and ending dates of the taxable period.

LINES 1(a)-1(k) - ADDITIONS TO INCOME TO DETERMINE 1120S CORPORATION GROSS BUSINESS PROFITS
Round every entry to the nearest whole dollar (if 49 cents or less round down, if 50 cents or more round up).
REPORT NEGATIVE AMOUNTS USING A MINUS SIGN.
LINE 1(a)
Enter Schedule K, Line 1 ordinary business income (loss).
LINE 1(b)
Enter Schedule K, Line 2 net rental real estate income (loss).
LINE 1(c)
Enter Schedule K, Line 3(c) net income (loss) from other rental activities other than those reported on Form 8825. The gain or loss from the sale of an asset used as a
rental as reported on Line 17 of Federal Form 4797 is reflected on Line 1(c).
LINE 1(d)
Enter Schedule K, Line 4 interest income.
LINE 1(e)
Enter Schedule K, Line 5(a) dividend income.
LINE 1(f)
Enter Schedule K, Line 6 royalty income.
LINE 1(g)
Enter the amount of net short-term capital gain reported on Federal Form 1120S, Schedule K, Line 7 less the amount of net long-term.
LINE 1(h)
Enter the amount of net long-term capital gain reported on Federal Form 1120S, Schedule K, Line 8(a), less the amount of net short term capital loss reported on
Federal Form120S, Schedule K, Line 7, but not less than zero.
LINE 1(i)
Enter Schedule K, Line 9 net section 1231 gain or loss from the sale of assets used in the business as reported on Federal Form 4797.
LINE 1(j)
Enter Schedule K, Line 10 any other item of income (loss) not reported above is reported here and includes such items as other portfolio income not reported as
interest, ordinary dividends, royalty, and capital gain (loss) on prior add backs to corporate income on the NH-1120. Cancellation of debt is recognized as income to
the corporation and should also be reported here.
LINE 1(k)
Enter the amount of any other item of income (loss) not reported on Federal Form 1120S, Schedule K, that should be included in gross business profits. Sales of
property for which IRC §179 expense deduction has been passed through to a shareholder should be reported here. Also include global intangible low-taxed income
from controlled foreign corporations owned by the business organization and reported on the returns of the shareholders of the business organization under Treas.
Reg. 1.951A-1(e)(i).

LINES 1(l)-1(q) AND 2 - DEDUCTIONS TO INCOME TO DETERMINE 1120S CORPORATION GROSS BUSINESS PROFIT
LINE 1(l)
Enter Schedule K, Line 11 Enter IRC §179 expense reported on Federal Form 1120S.
LINE 1(m)
Enter Schedule K, Line 12(a) deductions for charitable contributions to tax exempt organizations by 1120S corporations (must follow the limitations for charitable
contributions followed by C-Corporations).
LINE 1(n)
Enter Schedule K, Line 12(b) investment interest expense related to assets held for investment purposes. This is deductible if the assets or debt is associated with the
production of income for the corporation.
LINE 1(o)
Enter Schedule K, Line 12(c) IRC §59(e)(2) expenditures are deductible on the Form NH-1120.
LINE 1(p)
Enter Schedule K, Line 12(d) This line includes only business expenses allowed as deductions for BPT adjustment not reported on Schedule K, Lines 12(a),12(b), or
12(c). New Hampshire does not have any limitations placed on portfolio deductions, thus the 2% limitations to AGI at the shareholder level does not apply to this
deduction for the corporation.
LINE 1(q)
Enter Schedule K, Line 16(f) Deduct the amount of foreign taxes paid or accrued on this line. Foreign taxes deducted on this line would be an add back to income on
NH-1120, Additions and Deductions, Line 6(b), or NH-1120-WE Additions and Deductions Line 12(d).
LINE 2
Combine Lines 1(a) through 1(k) and from the result subtract the sum of Lines 1(l) through 1(q). Report on Form NH-1120-WE, Schedule 1-A, Line 2 or Form NH-1120,
Line 1.
DP-120 Instructions 2023
Version 1 12/2023

Page 2 of 2