PIT_IT1140_Instructions__2012_FS_122812 1140 PIT IT1140 Instructions

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2012

Ohio IT 1140

Pass-Through Entity

and Trust Withholding

Tax Return Instructions

Rev. 12/12

For taxable years beginning in

hio

tax. hio.gov

Department of

Taxation

Purpose: Use this form to report withholding tax due on (i) pass-

through entity distributive shares of income and (ii) trust distributions

of income relating to real property in Ohio and to tangible personal

property in Ohio.

Trusts may also be required to ﬁ le the Ohio Fiduciary Income Tax

Return, Ohio form IT 1041, which is on the Department of Taxation’s

Web site at tax.ohio.gov.

Important note: There is no need to ﬁ le if any of the following is

applicable for the entire taxable year:

• The entity is a trust whose beneﬁ ciaries are limited to full-year

Ohio resident taxpayers: individuals, estates and trusts (R.C.

5747.01(I) and (N); OR

• The entity is a trust that has no real estate located in Ohio, no

tangible personal property located in Ohio and no direct or in-

direct equity investments in (i) S corporations (including limited

liability companies treated as S corporations for federal income

tax purposes) that have nexus with Ohio, (ii) partnerships that

have nexus with Ohio, and (iii) limited liability companies that

have nexus with Ohio and for federal income tax purposes are

treated as either partnerships or S corporations; OR

• The entity is an S corporation, a partnership or a limited liability

company treated for federal income tax purposes as either a

partnership or S corporation, and such entity’s equity investors are

limited to full-year Ohio resident taxpayers (individuals, estates

and trusts) [R.C. 5747.01(I) and (N)] or corporations that are

timely paying, or are exempt from paying, the Ohio corporation

franchise tax; OR

• The entity is an S corporation, partnership or limited liability

company treated for federal income tax purposes as either a

partnership or S corporation, and the entity is ﬁ ling the Ohio form

IT 4708 (“Composite Income Tax Return for Certain Investors in a

Pass-through Entitiy”) on behalf of all of its equity investors who

are not full-year Ohio resident taxpayers (individuals, estates and

trusts) [R.C. 5747.01(I) and (N)]; OR

• The entity is either a disregarded entity or a qualifying subchapter

S subsidiary, and the entity’s owner is ﬁ ling with, or is exempt

from ﬁ ling with, the Ohio Department of Taxation the appropriate

income or franchise tax returns.

General Instructions

These instructions provide a general overview of the annual ﬁ ling

and payment requirements for pass-through entities and trusts.

For detailed information, see R.C. 5733.40, 5733.41 and 5747.40

through 5747.453. You can also call 1-614-387-0234 (Ohio Relay

Service, 1-800-750-0750) for additional assistance.

Each “qualifying pass-through entity” (see “What Is a Qualifying

Pass-Through Entity?” on page 3) doing business in Ohio or oth-

erwise having nexus with Ohio under the Constitution of the United

States is subject to a withholding tax and to an entity tax based

upon each qualifying investor’s share of the qualifying pass-through

entity’s proﬁ ts apportioned to Ohio (see “Who is a Qualifying Inves-

tor?” on page 3). But see the table on page 9 for information relat-

ing to Amended Substitute House Bill 66, 126th General Assembly

and pass-through entity owners who are affected by the entity tax

phase-out for certain corporate investors.

In addition, each “qualifying trust” (deﬁ ned on page 3) is subject to a

withholding tax based upon distributions of certain types of income

(discussed on page 4) to individuals who are nonresidents of Ohio

for any portion of the trust’s taxable year.

This yearly withholding tax return, Ohio form IT 1140, and pay-

ment of the tax are due on the 15th day of the fourth month

following the end of the qualifying pass-through entity’s or

qualifying trust’s taxable year. Also see “Extension of Time To

File,” below. Note: Ohio will follow the lead of the IRS by extending

the ﬁ ling deadline for taxable year 2011 to April 17, 2012.

Note: The tax is due only if the “adjusted qualifying amount” exceeds

$1,000 (see Schedule B, line 9 and Schedule D, line 3).

Which Form Should I Use: Ohio IT 1140 or IT 4708?

Qualifying pass-through entities whose equity investors are limited to

nonresident individuals, nonresident estates and nonresident trusts

can ﬁ le either Ohio forms IT 1140 or IT 4708. All other qualifying

pass-through entities may ﬁ le Ohio form IT 1140 or may choose to

ﬁ le Ohio form IT 4708.

Ohio form IT 1140 is based upon the ﬁ rst day of the pass-through

entity’s calendar or ﬁ scal year; Ohio form IT 4708 is based upon

the last day of the pass-through entity’s calendar or ﬁ scal year. A

pass-through entity that changes forms from year to year must make

sure that (i) all periods of income are reported and (ii) all related tax

is timely and fully paid.

Example: A pass-through entity whose equity investors are com-

posed solely of nonresident individuals has a Jan. 31 ﬁ scal year

end. For the ﬁ scal year beginning Feb. 1, 2011 and ending Jan. 31,

2012, the pass-through entity elects to ﬁ le Ohio form IT 4708 for the

2012 year (this return would be due April 15, 2013 – not April 17,

2012). For the ﬁ scal year beginning Feb. 1, 2012 and ending Jan.

31, 2013, the entity elects to ﬁ le Ohio form IT 1140 for 2012. This

return would be due May 15, 2013. For the ﬁ scal year beginning

Feb. 1, 2013 and ending Jan. 31, 2014, the entity elects to ﬁ le the

2014 Ohio form IT 4708. This return would be due April 15, 2015.

With this fact pattern the pass-through entity will not ﬁ le any 2013

Ohio pass-through entity return, but the pass-through entity will

have reported all periods of income.

Extension of Time to File Ohio Form IT 1140

If the qualifying pass-through entity or the qualifying trust has an

extension of time to ﬁ le the federal tax return (IRS form 1065, 1120S

or 1041), then the qualifying pass-through entity or qualifying trust

has the same extension of time to ﬁ le the Ohio form IT 1140.

For example, if (i) the IRS form 1065 is due April 15, 2013 and

(ii) the Ohio form IT 1140 is due April 15, 2013. The pass-through

entity obtains from the IRS an extension of time to ﬁ le until Sept.

16, 2013 (a ﬁ ve-month extension). In this example the Ohio form IT

1140 would be due Sept. 16, 2013 (ﬁ ve months later than the April

15, 2013 unextended due date).

However, there is no extension of time for payment of the with-

holding tax or the entity tax. Late payments are subject to interest

and penalties. As such, interest will apply to all late payments, and

a failure-to-pay-timely penalty will apply if (i) less than 90% of the

tax is paid by the unextended due date and (ii) the balance of the

tax due is not paid by the extended due date.

If the qualifying pass-through entity or qualifying trust has secured

from the IRS an extension of time to ﬁ le, use Ohio form IT 1140 EXT

for taxable years beginning in 2012 to remit any withholding tax and/

or entity tax due but not yet paid as of the unextended due date.

Preparer’s Name

The Ohio Department of Taxation follows IRS Service Notice 2004-

54, which provides for alternative preparer signature procedures

for IRS income tax paper returns that paid practitioners prepare

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Rev. 12/12

on behalf of their clients. Except as set forth below, paid preparers

must follow those same procedures with respect to the following

Ohio paper returns: individual income tax, school district income tax,

withholding tax (employer and pass-through entity) and corporation

franchise tax. See R.C. 5703.262(B) and 5747.08(F).

Exception: The paid preparer should print (rather than write) his/her

name on the form if the taxpayer checks “Yes” to the question, “Do

you authorize your preparer to contact us regarding this return?”

Reporting IRS Changes

If as a result of a taxpayer’s amendment to or the IRS adjustment to

the taxpayer’s federal income tax return or if, as a result of any other

recomputation or redetermination a change occurs in any item affect-

ing the computation of the taxpayer’s income as reported for federal

income tax purposes, the taxpayer must ﬁ le an amended Ohio form IT

1140 with the Ohio Department of Taxation no later than one year after

ﬁ nal determination of the adjustment for federal income tax purposes.

This provision applies even if the statute of limitations has passed

and applies to amended returns that reﬂ ect overpayments as well

as to amended returns that reﬂ ect underpayments. If the amended

return reﬂ ects an underpayment, the amended return must be

accompanied by payment of any additional tax and interest. If the

amended return reﬂ ects an overpayment, the amended return must

be accompanied by a statement that sets forth the full and complete

reason for the overpayment. See Abitibi-Price Corporation and

Subsidiaries v. Tracy, BTA No. 98-N-401 (3-12-01).

Upon completing an amended return, please check the “amend-

ed return” box on the front of the return.

Caution: The IRS informs us of all changes it makes to federal

income tax returns. To avoid penalties, be sure the pass-through

entity ﬁ les its Ohio amended return within one year of the ﬁ nal

determination of the federal change.

Estimated Withholding Tax Payments for the Taxable Year

Beginning in 2013

If the qualifying pass-through entity or qualifying trust has nexus

with Ohio during any portion of its taxable year beginning in 2013,

the qualifying pass-through entity or qualifying trust must make esti-

mated withholding tax payments for the taxable year if (i) the sum of

the “adjusted qualifying amounts” for the taxable year beginning in

2012 exceeded $10,000 and (ii) the sum of the “adjusted qualifying

amounts” for the taxable year beginning in 2013 will exceed $10,000.

For the calculation of the adjusted qualifying amount see line 9

on Ohio form IT 1140ES Worksheet #1 and line 3 on Ohio form IT

1140ES Worksheet #3. Ohio form IT 1140ES and the worksheets

are on our Web site at tax.ohio.gov.

These estimated payments are due on the 15th day of the month

following the last day of each quarter of the taxable year. If the 15th

day falls on a weekend or holiday, then the due date is the ﬁ rst busi-

ness day following the 15th. Note: Ohio will follow the lead of the

IRS by extending the ﬁ ling deadline for taxable year 2011 to April

17, 2012. Late payments of estimated tax are subject to interest

penalties (see Ohio form IT/SD 2210). The year 2012 Ohio form IT

1140ES must accompany each estimated payment.

Penalties and Interest

If the entity fails to ﬁ le the Ohio pass-through entity and trust with-

holding tax return by the due date (or extended federal due date),

the law provides for a failure to ﬁ le penalty, which is the greater

of $50 per month up to a maximum of $500, or 5% per month up

to a maximum of 50% of the tax.

If the entity fails to pay the full amount of tax by the 15th day of

the fourth month following the last day of the taxable year, the law

provides for a failure-to-pay penalty, which is up to a maximum of

double the interest charged. The penalty will not apply if the entity

obtained a federal extension of time to ﬁ le and if the entity’s total

payments made by the due date without extension equal or exceed

90% of the total Ohio tax due. To make an extension payment,

please use the year 2012 Ohio form IT 1140EXT, which is on our

Web site at tax.ohio.gov.

In all cases, interest is due on the late payments from the unex-

tended due date to the date of payment. The interest rate is 3% per

annum for 2012 and 3% per annum for 2013.

What Is a Qualifying Pass-Through Entity?

A qualifying pass-through entity is each S corporation, partner-

ship or limited liability company treated as either a partnership or an

S corporation for federal income tax purposes. However, a qualifying

pass-through entity does not include the following:

• Disregarded entities and qualifying subchapter S subsidiar-

ies if the owner is ﬁ ling, or is exempt from ﬁ ling, with the Ohio

Department of Taxation the appropriate income or franchise tax

returns;

• Entities having no qualifying investors (see “Who is a Qualifying

Investor?” below);

• Pension plans and charities (an entity exempt from federal in-

come tax pursuant to Internal Revenue Code (I.R.C.) 501(a) or

501(c));

• Publicly traded partnerships (a partnership with equity securities

registered with the U.S. Securities Exchange Commission under

section 12 of the Securities Exchange Act of 1934);

• Entities that are real estate investment trusts, regulated invest-

ment companies or real estate mortgage investment conduits;

• Any entity treated as a “disregarded entity” for federal income tax

purposes (see the “Check the Box” U.S. Treasury regulations), AND

• Qualiﬁ ed subchapter S subsidiary (QSSS) corporations (however,

if the parent S corporation has qualifying investors, the parent

S corporation is a pass-through entity that must compute the

tax on a consolidated basis with all of the S corporation’s QSSS

corporations).

What Is a Qualifying Trust?

A qualifying trust is each trust that meets the following three

requirements during the trust’s taxable year:

• The trust will ﬁ le the IRS form 1041, U.S. Income Tax Return for

Estates and Trusts; AND

• The trust has at least one beneﬁ ciary who is neither a full-year

Ohio resident individual nor an Ohio resident estate; AND

• The trust makes a distribution to a nonresident beneﬁ ciary, and

the distribution directly or indirectly relates either to real estate

located in Ohio or to tangible personal property located in Ohio.

Who Is a Qualifying Investor?

According to R.C. 5733.40(I), a qualifying investor is any qualify-

ing pass-through entity investor other than those qualifying pass-

through entity investors listed:

1. Investors that are pension plans or charities (investors that are

exempt from federal income tax pursuant to I.R.C. 501(a) or

501(c)).

2. Investors that are publicly traded partnerships (investors that

are partnerships with equity securities registered with the U.S.

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IT 1140

Rev. 12/12

Securities Exchange Commission under section 12 of the

Securities Exchange Act of 1934).

3. Investors that are colleges or universities (investors that are

“institutions of higher education” as deﬁ ned in R.C. 3334.01(F)).

4. Investors that are public utilities in Ohio and are required to

pay the Ohio gross receipts excise tax.

5. Investors that are insurance companies, fraternal corporations,

beneﬁ cial corporations, bond investment corporations, health

maintenance organizations or any other corporation required to

ﬁ le an annual report with the Ohio superintendent of insurance.

6. Investors that are dealers in intangibles as deﬁ ned in R.C.

5725.01(B).

7. Investors that are real estate investment trusts, regulated invest-

ment companies or real estate mortgage investment conduits.

8. Nonresident individuals on whose behalf, and nonresident es-

tates on whose behalf, the qualifying pass-through entity ﬁ les

Ohio form IT 4708, “Composite Income Tax Return for Certain

Investors in a Pass-through Entitiy” for the taxable year.

9. Investors that are ﬁ nancial institutions liable for the corporation

franchise tax in accordance with R.C. 5733.06(D) on the ﬁ rst

day of January of the calendar year immediately following the

last day of the ﬁ nancial institution’s calendar or ﬁ scal year in

which or with which ends the qualifying pass-through entity’s

taxable year.

10. Investors that are themselves qualifying pass-through entities

if the qualifying pass-through entities’ investors during the

three-year period beginning 12 months before the ﬁ rst day of

the investee entity’s taxable year are limited to those investors

set forth in items #1 through #9, above (or any combination

thereof).

11. Investors that are themselves pass-through entities, but

only if the owners of those other pass-through entities are

limited to (i) individuals who are full-year residents of Ohio,

(ii) estates domiciled in Ohio, (iii) nonresident individuals on

whose behalf those other pass-through entities ﬁ le Ohio form

IT 4708, “Composite Income Tax Return for Certain Investors

in a Pass-through Entitiy,” and/or (iv) nonresident estates on

whose behalf those other pass-through entities ﬁ le Ohio form

IT 4708, “Composite Income Tax Return for Certain Investors

in a Pass-through Entitiy” for the taxable year.

12. Investors that satisfy all the following:

• The investor submits a written statement to the qualifying

pass-through entity stating that the investor irrevocably

agrees that the investor has nexus with Ohio and is subject

to and liable for the corporation franchise tax calculated under

R.C. 5733.06 with respect to the investor’s distributive share

of income attributable to the pass-through entity;

• The investor makes a good faith and reasonable effort to fully

comply with all of the corporation franchise tax reporting and

paying requirements set forth in R.C. chapter 5733; AND

• Neither the investor nor the qualifying pass-through entity car-

ries out, at any time, any transactions either with any related

members of the investor or with any related member of the

entity where such transactions either result in or would result

in a reduction or deferral of the Ohio corporation franchise tax.

13. Investors that are either trusts or funds whose beneﬁ ciaries are

limited to the following during the taxable year of the qualifying

pass-through entity;

• Persons that are or may be beneﬁ ciaries of a pension plan

trust, proﬁ t-sharing trust, a stock bonus plan trust or similar

retirement trust; OR

• Persons that are or may be beneﬁ ciaries of or the recipients

of payments from a trust or fund that is a nuclear decommis-

sioning reserve fund, a designated settlement fund, or any

other similar trust or fund established to resolve and satisfy

similar injury claims; OR

• Persons who are or may be the beneﬁ ciaries of a complex

trust, but only if the trust irrevocably agrees in writing that,

for the taxable year during or for which the trust distributes

any of its income to any of its beneﬁ ciaries who are individu-

als residing outside Ohio, the trust will be withholding tax as

required under R.C. 5747.41 through 5747.453.

14. Investors that are corporations paying the Ohio corporation

franchise tax but only if all the other equity investors in the

qualifying pass-through entity are limited to (i) other corpora-

tions that are paying the Ohio corporation franchise tax and/

or (ii) corporations that would be paying the Ohio corporation

franchise tax if they were not exempt from the Ohio corporation

franchise tax under R.C. 5733.09. See the second sentence of

the third paragraph of R.C. 5733.41.

15 . Investors that are “investment pass-through entities” (deﬁ ned

below.), but only if the investment pass-through entity pro-

vides to the qualifying pass-through entity the name, address

and Social Security number or federal employer identiﬁ cation

number (FEIN) of each person who has an equity investment

in the investment pass-through entity.

Special Notes

A. The entity tax does not apply to any pass-through entity to

the extent that the pass-through entity’s distributive shares of

income and gain pass through from that entity to another pass-

through entity (hereinafter referred to as the “investing entity”) if

the investing entity (i) is not an investment pass-through entity

(deﬁ ned below), (ii) irrevocably acknowledges that it has nexus

with this state under the U.S. Constitution during the taxable year,

(iii) makes a good faith and reasonable effort to comply with both

the entity tax law and the withholding tax law, and (iv) includes

in its apportionment factors (see Schedule C) its proportionate

share of each lower-tiered pass-through entity’s property, payroll

and sales. See R.C. 5733.402.

B. Neither the entity tax nor the withholding tax applies to an invest-

ment pass-through entity’s items of income listed below in the

deﬁ nition of “investment pass-through entity.”

An investment pass-through entity is a pass-through entity

having for its taxable year at least 90% of its assets represented

by intangible assets and having for its taxable year at least 90%

of its gross income from one or more of the following sources:

• Transaction fees earned in connection with the acquisition,

ownership or disposition of intangible property.

• Loan fees

• Financing fees

• Consent fees

• Waiver fees

• Application fees

• Net management fees (management fees that the pass-

through entity earns or receives from all sources reduced by

the management fees that the pass-through entity incurs or

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IT 1140

Rev. 12/12

pays to any person), but only if such net management fees

do not exceed 5% of the pass-through entity’s proﬁ t.

• Dividend income

• Interest income

• Net capital gains from the sale or exchange of intangible

property,

• All types and classiﬁ cations of income and gain attributable to

distributive shares of income and gain from other pass-through

entities.

The percentages are based upon quarterly averages calculated

during the pass-through entity’s taxable year. Furthermore, for

purposes of determining if a pass-through entity is an investment

pass-through entity, intangible assets include investments in

other pass-through entities. See R.C. 5733.402.

C. An equity investor (subsequently referred to as a “deemed inves-

tor”) in an investment pass-through entity shall be deemed to be

an equity investor in any qualifying pass-through entity in which

the investment pass-through entity is a direct equity investor.

Each deemed investor’s portion of the qualifying pass-through

entity’s adjusted qualifying amount will be (i) the adjusted

qualifying amount that would otherwise pass through from the

qualifying pass-through entity to the investment pass-through

entity multiplied by (ii) the percentage of the deemed investor’s

direct ownership in the investment pass-through entity. Thus,

except as discussed below, the qualifying pass-through entity

must pay the withholding tax and entity tax as if the investors in

the investment pass-through entity were actual investors in the

qualifying pass-through entity (hence, “deemed investors”).

If the taxable year of the investment pass-through entity ends on

a day that is different than the last day of the investee qualifying

pass-through entity’s taxable year, then this “deemed investor”

rule applies to those persons who are the direct investors in the

investment pass-through entity on the last day of the investee

qualifying pass-through entity’s taxable year ending within the

investment pass-through entity’s taxable year. See R.C. 5747.401.

This “deemed investor” rule applies only to the extent the in-

vestment pass-through entity provides on a timely basis to the

qualifying pass-through entity the name, address and Social

Security number or FEIN for each investor in the investment

pass-through entity.

If the investment pass-through entity does not provide on a

timely basis to the qualifying pass-through entity the name, ad-

dress and Social Security number or FEIN for each investor in

the investment pass-through entity and if the investment pass-

through entity is a qualifying investor, then the investee qualifying

pass-through entity must pay the 8.5% entity tax with respect to

the distributive share of income and gain passing through from

the investee qualifying pass-through entity to the investment

pass-through entity.

Calculating the Tax

The tax is due only if the adjusted qualifying amount exceeds

$1,000 (see Schedule B, line 9 and Schedule D, line 3). The tax is

calculated as follows:

• The 5% withholding tax applies to the adjusted qualifying amounts

for all qualifying investors who are nonresident individuals for any

portion of the qualifying pass-through entity’s taxable year (see

Schedule B, column A) AND

• The 5% withholding tax also applies to adjusted qualifying

amounts that the qualifying trust pays to the qualifying trust’s

beneﬁ ciaries included in this return who are nonresident indi-

viduals for any portion of the qualifying trust’s taxable year (see

Schedule D) AND

• The 8.5% entity tax (see page 7, Line 10 – Tax Rate) applies to

the adjusted qualifying amounts for all qualifying investors other

than nonresident individuals and corporate investors subject to

phase-out (see Schedule B, column B).

Required Documents for Ohio Form IT 1140

All qualifying pass-through entities and qualifying trusts must com-

plete Schedule E Investor Information and include with Ohio form

IT 1140 the K-1s of participating investors.

Responsible Party Liability

R.C. 5747.453 imposes personal liability for failure to pay the with-

holding tax. Set forth below is that section of the law:

An employee or beneﬁ ciary of, or investor in, a qualifying

entity having control or supervision of, or charged with the

responsibility for, ﬁ ling returns and making payments, or any

trustee or other ﬁ duciary, ofﬁ cer, member or manager of the

qualifying entity who is responsible for the execution of the

qualifying entity’s ﬁ scal responsibilities, is personally liable for

the failure to ﬁ le any report or to pay any tax due as required

by sections 5747.40 to 5747.453 of the Revised Code. The

dissolution, termination or bankruptcy of a qualifying entity

does not discharge a responsible trustee’s, ﬁ duciary’s, ofﬁ cer’s,

member’s, manager’s, employee’s, investor’s or beneﬁ ciary’s

liability for failure of the qualifying entity to ﬁ le any report or

pay any tax due as required by those sections. The sum due

for the liability may be collected by assessment in the manner

provided in section 5747.13 of the Revised Code.

Interest Penalty on Underpayment of Tax – Schedule A, Line 2

To compute an interest penalty (or to show that no interest penalty

is due), complete Ohio form IT/SD 2210 (available on our Web site

at tax.ohio.gov). Enter on Schedule A, line 2 any interest penalty

due and attach Ohio form IT/SD 2210 to the return.

Payment Transfers – Schedule A, Lines 3(a) and 3(b)

If the pass-through entity or trust has used Ohio form IT 4708ES to

make estimated payments in connection with the pass-through entity

composite income tax, the pass-through entity or trust can elect to

apply some or all of those Ohio form IT 4708ES payments to satisfy

the tax due on Ohio form IT 1140. If the pass-through entity or trust

so elects, please indicate on Ohio form IT 1140, Schedule A, line 3a

the amount to be transferred from the Ohio forms IT 4708ES and IT

4708EXT payments to Ohio form IT 1140. If the pass-through entity

will be ﬁ ling both Ohio forms IT 1140 and IT 4708, please include

with Ohio form IT 1140 a schedule setting forth (i) the dates on which

the pass-through entity or trust made the Ohio form IT 4708ES and

Ohio form IT 4708EXT payments, (ii) the amount of each payment

transferred to Ohio form IT 1140 and (iii) if an amended return, the

amount of payment(s) previously claimed for this taxable year.

The pass-through entity can also elect to transfer Ohio form IT

1140ES payments to Ohio form IT 4708 (“Composite Income Tax

Return for Certain Investors in a Pass-through Entitiy”). To the extent

that the pass-through entity elects to make such transfers, please

indicate on Ohio form IT 1140, Schedule A, line 3b the amount to be

transferred from Ohio forms IT 1140ES or IT 1140EXT payments to

Ohio form IT 4708. If the pass-through entity will be ﬁ ling both Ohio

forms IT 1140 and IT 4708, the pass-through entity should include

Ohio form IT 4708 a schedule setting forth (i) the dates of Ohio form

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Rev. 12/12

IT 1140ES payments, (ii) the amount of each payment transferred

to Ohio form IT 4708 and (iii) if an amended return, the amount of

refund(s) previously claimed for this taxable year.

Interest and Penalty Due on Late-Paid Tax and/or

Late-Filed Return – Schedule A, Line 9

Enter on Schedule A, line 9 any interest and penalty due. (See page

3, penalites and interest, for details.)

Line 10 – Total Amount Owed

Make check payable to Ohio Treasurer of State, include Ohio form

IT 1140P and place your FEIN on the check.

Schedule B – Qualifying Pass-Through Entities – Tax Due

Line 2(a) and Schedule D, Line 2(a) – Depreciation Add-Back

R.C. 5701.11 and 5733.40(A)(5) state that in determining the “adjusted

qualifying amount” each taxpayer must add back 2/3, 5/6 or 6/6 of the

I.R.C. 168(k) bonus depreciation claimed for the taxable year under the

I.R.C. and must also add back 2/3, 5/6 or 6/6 of the qualifying I.R.C. 179

depreciation expense claimed for the taxable year. Qualifying I.R.C. 179

depreciation expense is the excess of (i) the amount of depreciation

expense directly or indirectly claimed by the taxpayer under I.R.C.

179 over (ii) the amount of depreciation expense directly or indirectly

allowed to the taxpayer under I.R.C. 179 in effect on Dec. 31, 2002.

See Am. Sub. House Bill 472, 129th General Assembly.

Under I.R.C. 179 as that section existed on Dec. 31, 2002, the

maximum amount that could be expensed was $25,000, and

the phase-out began once the cost of purchases of section 179

property during the year exceeded $200,000. So, under the prior

law, the taxpayer could not claim any section 179 expense if the

taxpayer’s purchases during the year of section 179 property, as

deﬁ ned on Dec. 31, 2002, were $225,000 or more. In each of the

subsequent taxable years, the taxpayer can deduct 1/2, 1/5 or 1/6

of the amounts previously added back.

If the pass-through entity or trust made the 2/3, 5/6 or 6/6 add-

back on line 2(a), shareholders should also include the respective

add-back on the shareholder’s Ohio individual income tax return

(IT 1040), along with any other federal add-backs. For Schedule

D calculations, only the add-backs coming from the entity doing

business in Ohio can be used. This applies to the 1/2, 1/5 or 1/6

depreciation expenses deduction as well.

Important: S corporation shareholders cannot claim this deduction

with respect to depreciable property for which the add-back occurred

while the corporation was a C corporation. See R.C. 5733.40(A)(5),

5747.01(A)(21)(a) and 5747.01(S)(14).

This “add-back and subsequent deduction” law also covers (i)

depreciable assets acquired by the taxpayer’s disregarded entities

and (ii) depreciable assets that are owned by pass-through entities

in which the taxpayer directly or indirectly owns at least 5% (see R.C.

5747.01(A)(20)(a)).

In addition, the pass-through entity can defer making all or some of

the add-back under the following circumstances:

(i) the pass-through entity is an equity investor in another

pass-through entity that has generated I.R.C. 168(k) bonus

depreciation and/or I.R.C. 179 depreciation; AND (ii) because

of either the federal passive activity loss limitation rules or the

federal at-risk limitation rules, this investor pass-through entity

is unable to deduct fully a loss passing through from the other

pass-through entity to this investor pass-through entity

In such circumstances, to the extent that this investor pass-through

entity does not deduct the loss passing through, this investor pass-

through entity can defer making the “2/3, 5/6 or 6/6 add-back”

until the taxable year or years for which this investor pass-through

entity does deduct the investee pass-through entity’s loss and does

receive a federal tax beneﬁ t from the bonus depreciation amount

and/or the I.R.C. 179 amount generated by the investee pass-

through entity. Of course, this investor pass-through entity cannot

begin claiming the related subsequent years deduction until the ﬁ rst

taxable year immediately following the taxable year for which this

investor pass-through entity makes the 2/3, 5/6 or 6/6 add-back.

For detailed information and examples regarding these adjustments,

see R.C. 5747.01(A)(20) as amended by the 129th General

Assembly in HB 365 and information releases 2002-02 and 2002-01

regarding Ohio bonus depreciation adjustments available on our

Web site at tax.ohio.gov. These releases were originally posted

on July 31, 2002 and Nov. 7, 2002.

Line 2(b) and Schedule D, Line 2(b) – Other Adjustments

Adjustments available to taxpayers are (i) the subsequent years de-

preciation deduction discussed above , (ii) miscellaneous federal tax

adjustments (discussed below), (iii) amounts not subject to a tax on

or measured by net income (discussed below) and (iv) the domestic

production activities deduction allowable to qualifying investors.

Miscellaneous Federal Income Tax Adjustments

Because of a recent amendment to R.C. section 5701.11, there are

no miscellaneous federal tax adjustments on this return. See Am.

Sub. House Bill 472, 129th General Assembly. However, you must

make all other required adjustments for this line.

Amounts Not Subject to a Tax on or Measured by Net Income

R.C. 5733.40(A)(2) provides that distributive shares of income

from qualifying pass-through entities and distributions from quali-

fying trusts shall be reduced by “any amount that, pursuant to the

Constitution of the United States, the Constitution of Ohio or any

federal law is not subject to a tax on or measured by net income.”

Such items of income include the following:

• Federal interest income that under federal law is exempt from

state tax measured on or by net income (see the department’s

Jan. 9, 1992, information release entitled “Exempt Federal

Interest Income,” which lists most types of federal interest

income that is exempt). You can obtain a copy of the release

by accessing the department’s Web site at tax.ohio.gov. Click

on the “Information Releases” link.

• All income that the qualifying pass-through entity earns if the

qualifying pass-through entity claims an exemption under U.S.

Public Law 86-272 and if the qualifying pass-through entity has no

related members having nexus with Ohio under the Constitution

of the United States for any portion of the qualifying pass-through

entity’s taxable year (see R.C. 5733.042(A)(6) for the deﬁ nition

of “related member”).

• An investment pass-through entity’s items of income listed on

page 4.

• Interest income from Ohio public obligations and Ohio purchase

obligations and gains from the sale or other disposition of Ohio

public obligations. See R.C. 5709.76.

Line 6 – Compensation Add-Back

Reciprocity agreements do not apply to those nonresidents directly

or indirectly owning at least 20% of the stock or other equity of

the pass-through entity. So pass-through entities cannot use the

reciprocity agreements in order to avoid adding back compensation

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IT 1140

Rev. 12/12

that the pass-through entities pay to such nonresidents. See R.C.

5733.40(A)(7).

Line 10 – Tax Rate

Consistent with the franchise tax rate phase-out, the tax rates ap-

plicable to distributive shares of income passing through to investors

other than individuals are shown in the table on page 9.

*The phase-out tax rate does not apply and the 8.5% tax rate

applies to the following qualifying investors:

– Estates, trusts and other pass-through entities.

– Financial holding companies as deﬁ ned in the federal “Bank

Holding Company Act.”

– Bank holding companies as deﬁ ned in the federal “Bank Holding

Company Act.”

– Savings-and-loan holding companies as deﬁ ned in the federal

“Homeowners Loan Act” that are engaging only in activities per-

missible under 12 United States Code (U.S.C.) 1843(k).

– Persons, other than persons held pursuant to merchant banking

authority under 12 U.S.C. 1843(k)(4)(H) or 12 U.S.C. 1843(k)(4)

(i), directly or indirectly “owned” by one or more ﬁ nancial institu-

tions, ﬁ nancial holding companies, bank holding companies, or

savings and loan holding companies, but only if those persons are

engaged in activities permissible for a ﬁ nancial holding company

under 12 U.S.C. 1843(k).

– Persons directly or indirectly “owned” by one or more insurance

companies but only if those persons (i) are authorized to do the

business of insurance in this state and (ii) are paying the Ohio

insurance-premiums tax.

– Persons that solely facilitate or service one or more “securitiza-

tions” or similar transactions for ﬁ nancial institutions, ﬁ nancial

holding companies, bank holding companies, savings-and-loan

holding companies, insurance companies, or persons directly or

indirectly “owned” by such businesses.

Deﬁ nition of “owned” for this purpose: generally, a person “owns”

another entity if the person . . .

• owns at least 50% of the entity’s voting stock (corporations),

• owns at least 50% of the entity’s memberhip interests (LLCs), OR

• has a beneﬁ cial interest in the entity’s proﬁ ts, surpluses, losses

or distributions (partnerships, trusts or other business interests)

Deﬁ nition of “securitization” for this purpose: transferring one or

more assets to one or more persons and then issuing securities

backed by the right to receive payment from the asset or assets

so transferred.

Schedule C – Qualifying Pass-Through Entities –

Tax Apportionment Ratio

Note: When calculating the withholding tax and the entity tax, each

qualifying pass-through entity and each qualifying trust investing in

another pass-through entity must apply the “aggregate” (conduit) theory

of taxation. That is, the character of all income and deductions (and

adjustments to income and deductions) realized by an S corporation

or a partnership or a limited liability company (treated as a partnership

or as an S corporation for federal income tax purposes) in which the

qualifying pass-through entity or qualifying trust has invested retains

that character for purposes of the withholding tax and the entity tax

when recognized by the qualifying pass-through entity. Furthermore,

the qualifying pass-through entity and qualifying trust must include in

its apportionment ratio its proportionate share of each lower-tiered

pass-through entity’s property, payroll and sales. See R.C. 5733.057

and 5747.231.

Property Factor

The property factor is a fraction, the numerator of which is the aver-

age value of the pass-through entity’s includable real and tangible

personal property owned or rented, and used in the trade or business

in this state during the taxable year, and the denominator of which

is the average value of all the pass-through entity’s includable real

and tangible personal property owned or rented, and used in the

trade or business everywhere during such year.

The property factor speciﬁ cally includes real property and tangible

personal property that the pass-through entity rents, subrents,

leases or subleases to others if the income or loss from such rent-

als, subrentals, leases or subleases is business income. Further-

more, for taxable years ending on or after June 26, 2003, Ohio law

speciﬁ cally excludes from the factor property relating to, or used in

connection with, the production of nonbusiness income allocated

under R.C. 5733.051.

Property owned by the pass-through entity is valued at its origi-

nal cost average value. Average value is determined by adding

the cost values at the beginning and at the end of the taxable

year and dividing the total by two. The tax commissioner may

require the use of monthly values during the taxable year if

such values more reasonably reﬂ ect the average value of the

corporation’s property.

In determining average value do not include in either “Within Ohio”

or in “Total Everywhere” the following:

• Construction in progress.

• Property relating to, or used in connection with, the production

of nonbusiness income. See R.C. 5733.05(B)(2) as amended

by Amended Substitute House Bill 95, 125th General Assembly,

applicable to taxable years ending on or after June 26, 2003.

• The original cost of property within Ohio with respect to which the

state of Ohio has issued an Air Pollution, Noise Pollution, or an

Industrial Water Pollution Control Certiﬁ cate. See R.C. 5733.05(B)

(2)(a).

• The original cost of real property and tangible property (or in

the case of property that the pass-through entity is renting from

others, eight times its net annual rental rate) within Ohio that is

used exclusively during the taxable year for qualiﬁ ed research.

Do not include in Within Ohio, but do include in Total Everywhere, the

original cost of qualifying improvements to land or tangible personal

property in an enterprise zone for which the taxpayer holds a Tax

Incentive Qualiﬁ cation Certiﬁ cate issued by the Ohio Development

Services Agency.

Line 1(a) – Property Owned – Within Ohio

Enter the average value of the pass-through entity’s real property and

tangible personal property, including leasehold improvements, owned

and used in the trade or business in Ohio during the taxable year.

Line 1(a) – Property Owned – Total Everywhere

Enter the average value of all the pass-through entity’s real property and

tangible personal property, including leasehold improvements, owned

and used in the trade or business everywhere during the taxable year.

Line 1(b) – Property Rented – Within Ohio

Enter the value of the pass-through entity’s real property and tangible

personal property rented and used in the trade or business Within

Ohio and Total Everywhere during the taxable year. Property rented

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IT 1140

Rev. 12/12

- 8 -

by the pass-through entity’s is valued at eight times the annual rental

rate (annual rental expense less subrental receipts).

Line 1(c) – Property Total – Within Ohio and Total Everywhere

Add lines 1(a) and 1(b) for Within Ohio and Total Everywhere.

Line 1(c) – Property Ratio

Enter the ratio of property Within Ohio to Total Everywhere by

dividing the amount Within Ohio by the Total Everywhere amount.

Line 1(c) – Weighted Property Ratio

Multiply the property ratio on line 1(c) by the property factor weight-

ing of 20%.

Payroll Factor

The payroll factor is a fraction, the numerator of which is the total

compensation paid in this state during the taxable year by the pass-

through entity, and the denominator of which is the total compensa-

tion paid both within and without this state during the taxable year

by the pass-through entity. As used below, the term “compensation”

means any form of remuneration paid to an employee for personal

services. Do not include in Within Ohio or in Total Everywhere the

following:

• Guaranteed payments made to partners.

• Compensation paid in Ohio to employees who are primarily en-

gaged in qualiﬁ ed research.

• For taxable years ending on or after June 26, 2003, compensation

paid to employees to the extent that the compensation relates

to the production of nonbusiness income allocable under R.C.

5733.051 (see R.C. 5733.05(B)(2)).

• Compensation that an S corporation paid to any shareholder

included in this report if the shareholder directly or indirectly

owned at least 20% of the S corporation at any time during the

year. R.C. 5733.40(A) (7).

Do not include in Within Ohio, but do include in Total Everywhere,

compensation paid in Ohio to certain speciﬁ ed new employees at

an urban job and enterprise zone facility for which the pass-through

entity has received a Tax Incentive Qualiﬁ cation Certiﬁ cate issued

by the Ohio Development Services Agency.

Line 2 – Payroll Within Ohio

Enter the total amount of the pass-through entity’s compensation

paid in Ohio during the taxable year. Compensation is paid in Ohio

if any of the following apply:

• The recipient’s service is performed entirely within Ohio; OR

• The recipient’s service is performed both within and outside Ohio,

but the service performed outside Ohio is incidental to the recipi-

ent’s service within Ohio; OR

• Some of the recipient’s service is performed within Ohio and

either the recipient’s base of operations, or if there is no base of

operations, the place from which the recipient’s service is directed

or controlled is within Ohio, or the base of operations or the place

from which the service is directed or controlled is not in any state

in which some part of the service is performed, but the recipient’s

residence is in Ohio.

Compensation is paid in Ohio to any employee of a common or con-

tract motor carrier corporation who performs his regularly assigned

duties on a motor vehicle in more than one state in the same ratio by

which the mileage traveled by such employee within Ohio bears to

the total mileage traveled by such employee everywhere during the

taxable year. The statutorily required mileage ratio applies only to

contract or common carriers. Thus, without approval by the tax com-

missioner a manufacturer or merchant who operates its own ﬂ eet

of delivery trucks may not situs driver payroll based upon the ratio

of miles traveled in Ohio to miles traveled everywhere. See Cooper

Tire and Rubber Co. v. Limbach (1994), 70 Ohio St. 3d 347.

Line 2 – Payroll – Total Everywhere

Enter the total amount of the pass-through entity’s compensation

paid everywhere during the taxable year.

Line 2 – Payroll – Ratio

Divide Within Ohio payroll by Total Everywhere payroll to arrive at

the payroll ratio.

Line 2 – Weighted Payroll Ratio

Multiply the property ratio on line 2 by the payroll factor weighting

of 20%.

Sales Factor

The sales factor is a fraction whose numerator is the pass-through

entity’s includable business income receipts in Ohio during the tax-

able year and whose denominator is the sum of the pass-through

entity’s within Ohio and without Ohio includable business income

receipts during the taxable year. The sales factor speciﬁ cally

excludes receipts attributable to nonbusiness income allocable

under R.C. 5733.051 (see R.C. 5733.05(B)(2) and the tax com-

missioner’s April 2004 information release entitled “Sales Factor

Situsing Revisions”).

The following receipts are not includable in either the numerator or

the denominator of the sales factor even if the receipts arise from

transactions, activities and sources in the regular course of a trade

or business (see R.C. 5733.05(B)(2)(c)):

• Interest or similar amounts received for the use of, or for the

forbearance of the use of, money;

• Dividends;

• Receipts and any related gains or losses from the sale or other

disposal of intangible property other than trademarks, trade

names, patents, copyrights and similar intellectual property;

• Receipts and any related gains and losses from the sale or other

disposal of tangible personal property or real property where that

property is a capital asset or an asset described in I.R.C. 1231.

For purposes of this provision the determination of whether or

not an asset is a capital asset or a 1231 asset is made without

regard to the holding period speciﬁ ed in the Internal Revenue

Code; AND

• Receipts from sales to: (a) an at-least-80%-owned public utility

other than an electric company, combined electric company, or

telephone company, (b) an at-least-80%-owned insurance com-

pany or (c) an at-least-25%-owned ﬁ nancial institution.

Note: Income and gain from receipts excluded from the sales factor

is not presumed to be nonbusiness income. All income, gain, loss

and expense is presumed to be apportionable business income –

even if the related receipts are excluded from the sales factor.

The law speciﬁ cally includes in the sales factor the following

amounts when arising from transactions, activities and sources in

the regular course of a trade or business: (1) receipts from sales

of tangible personal property, (2) receipts from the sale of real

property inventory (such as lots developed and sold by a real estate

developer), (3) rents and royalties from tangible personal property,

IT 1140

Rev. 12/12

- 9 -

(4) rents and royalties from real property, (5) receipts from the sale,

exchange, disposition or other grant of the right to use trademarks,

trade names, patents, copyrights and similar intellectual property,

(6) receipt from the sale of services and other receipts not expressly

excluded from the factor. These amounts are situsable to Ohio as

set out below.

Line 3 – Sales Within Ohio

Enter the total of gross receipts from sales not excludable from the

numerator and the denominator of the sales factor, to the extent

the includable gross receipts reﬂ ect business done in Ohio. Sales

within Ohio include the following:

• Receipts from sales of tangible personal property, less returns

and allowances, received by the purchaser in Ohio. In the case

of delivery of tangible personal property by common carrier or by

other means of transportation, the place at which such property

is ultimately received after all transportation has been completed

is considered as the place at which such property is received by

the purchaser. Direct delivery in Ohio, other than for purposes

of transportation, to a person or ﬁ rm designated by a purchaser

constitutes delivery to the purchaser in Ohio, and direct delivery

outside Ohio to a person or ﬁ rm designated by a purchaser does

not constitute delivery to the purchaser in Ohio, regardless of

where title passes or other conditions of sale. Customer pick-up

sales are situsable to the ﬁ nal destination after all transportation

(including customer transportation) has been completed. See

Dupps Co. v. Lindley (1980), 62 Ohio St. 2d 305.

Revenue from servicing, processing or modifying tangible per-

sonal property is sitused to the destination state as a sale of

tangible personal property. See Custom Deco, Inc. v. Limbach,

BTA Case No. 86-C-1024, June 2, 1989.

• Receipts from sales of real property inventory in Ohio.

• Rents and royalties from tangible personal property to the extent

the property was used in Ohio.

• Rents and royalties from real property located in Ohio.

• Receipts from the sale, exchange, disposition or other grant of

the right to use trademarks, trade names, patents, copyrights and

similar intellectual property are sitused to Ohio to the extent that

the receipts are based on the amount of use of that property in

Ohio. If the receipts are not based on the amount of use of that

property, but rather on the right to use the property and the payor

has the right to use the property in Ohio, then the receipts from

the sale, exchange, disposition or other grant of the right to use

such property are sitused to Ohio to the extent the receipts are

based on the right to use the property in Ohio.

• Receipts from the performance of services and receipts from any

other sales not excluded from the sales factor and not otherwise

sitused within or without Ohio under the above situsing provisions

are situsable to Ohio in the proportion to the purchaser’s beneﬁ t, with

respect to the sale, in Ohio to the purchaser’s beneﬁ t, with respect

to the sale, everywhere. The physical location where the purchaser

ultimately uses or receives the beneﬁ t of what was purchased is

paramount in determining the proportion of the beneﬁ t in Ohio to

the beneﬁ t everywhere. For taxable years ending on or after Dec.

11, 2003, the “cost-of-performance” provision is no longer the law.

Line 3 – Sales Total Everywhere

Enter the total of such includable gross receipts, less returns and

allowances, from sales everywhere.

Line 3 – Sales Ratio

Divide Within Ohio sales by Total Everywhere sales to arrive at the

sales ratio.

Line 3 – Weighted Sales Ratio

Multiply the sales ratio on line 3 by the sales factor weighting of 60%.

Line 4 – Total Weighted Apportionment Ratio

Add lines 1 (c), 2 and 3. Enter ratio here and on page 1, and on

Schedule B, line 8 (both columns).

Schedule E – Investor Information

Please provide investor information for all qualifying pass-through

entity and each qualifying trust with this return the qualifying K-1

information, which is any of the following:

• Completion of Schedule E and additional sheet(s) if necessary

(see “Tax Credits Available to Certain Investors and Beneﬁ cia-

ries” below). You need not include any attachments or schedules

relating to the K-1.

• A paper copy of pages 1 and 2 of IRS schedule K-1, which the

qualifying pass-through entity or qualifying trust will issue to each

qualifying investor and for each qualifying beneﬁ ciary. The K-1

must indicate the amount of tax credits that will pass through

from the qualifying pass-through entity or qualifying trust to

each qualifying investor or qualifying beneﬁ ciary. (See “Tax

Credits Available to Certain Investors and Beneﬁ ciaries” below).

Tax rate on Ohio income

passing through to qualifying

investors, other than

individuals, if the qualifying

investor is not subject to the

corporation franchise tax phase-out

* Fiscal ﬁ lers: Please use the rate in effect on the last day of the taxable year. If Schedule B, line 10, column (B) reﬂ ects both

the 8.5% rate and the phase-out rate, please attach a schedule reﬂ ecting the computation of tax for each investor.

6.8% (80% x 8.5%)

5.1% (60% x 8.5%)

3.4% (40% x 8.5%)

1.7% (20% x 8.5%)

0% (0% x 8.5%)

Pass-through entity’s taxable year

beginning in

Tax rate on Ohio income

passing through to qualifying

investors subject to the

corporation franchise tax phase-out*

2005

2006

2007

2008

2009 and thereafter

8.5%

Phase-Out of Pass-Through Entity Tax for Certain Corporate Investors

IT 1140

Rev. 12/12

qualifying trust has withheld in connection with that nonresident

individual qualifying beneﬁ ciary.

The credit is based upon the amount of tax (net of refunds, if

any) paid for the taxable year – even if the tax is paid, or if the

refund is received, after the end of the taxable year.

In order for qualifying investors and qualifying beneﬁ ciaries to claim

these credits, the qualifying investor or the qualifying beneﬁ ciary

must include with the corporation franchise tax report (Ohio forms

FT 1120 or FT 1120FI) or with the Ohio franchise tax request for

refund (Ohio form FT REF) or with the Ohio income tax return

(Ohio forms IT 1040, IT 1041 or IT 4708) a copy of the IRS form

K-1 indicating the amount of the entity tax and/or withholding tax

with respect to which the qualifying investor or qualfying beneﬁ ciary

seeks to claim a credit.

Accordingly, each qualifying pass-through entity or qualifying

trust must separately state on the form K-1, which the qualifying

pass-through entity or qualifying trust will issue to the qualify-

ing investor or qualifying beneﬁ ciary, the following information:

• The qualifying investor’s or beneﬁ ciary’s proportionate share

of the withholding tax and/or entity tax that the qualifying pass-

through entity or qualifying trust paid (net of refunds shown on

this return and net of amounts shown on Schedule A, line 3b,

which have been transferred to Ohio form IT 4708); AND

• The qualifying investor’s or beneﬁ ciary’s proportionate share of

the withholding tax and/or entity tax that passes through from

another pass-through entity or trust to the qualifying pass-through

entity or qualifying trust (and then passes on to the qualifying

investor or qualifying beneﬁ ciary).

If this pass-through entity or trust has invested in a partnership

or limited liability company that also ﬁ led Ohio form IT 1140, this

pass-through entity or trust is not entitled to any credit for this pass-

through entity’s or trust proportionate share of tax. Furthermore, this

pass-through entity or trust cannot claim the credit as an estimated

payment for this pass-through entity’s or trust’s taxable year.

However, the pass-through entity or trust can “pass through” (via

the K-1s it will issue) to its qualifying investors or to its qualifying

beneﬁ ciaries the pass-through entity’s or trust’s proportionate share

of such tax that the investee partnership or investee limited liability

company paid on behalf of this pass-through entity or trust.

- 10 -

• Magnetic media meeting the speciﬁ cations that the IRS requires

for the transmission of information by magnetic media (for more

information, see IRS publications 1525 and 3416). The magnetic

media must set forth the name, address and FEIN or Social

Security number for each qualifying investor and indicate

the net amount of tax credits that will pass through from

the qualifying pass-through entity or qualifying trust to each

qualifying investor or to each qualifying beneﬁ ciary (see “Tax

Credits Available to Certain Investors and Beneﬁ ciaries” below).

If a taxpayer submits the information in ASCII Comma Delimited

Format, the ﬁ elds must appear in the following order:

1. FEIN of the qualifying pass-through entity or trust.

2. Name of qualifying pass-through entity or trust.

3. Name of a qualifying investor or qualifying beneﬁ ciary.

4. FEIN or Social Security number of the qualifying investor or

qualifying beneﬁ ciary set forth in ﬁ eld number 3.

5. Street address of the qualifying investor or qualifying beneﬁ ciary

set forth in ﬁ eld number 3.

6. City of the qualifying investor or qualifying beneﬁ ciary set forth

in ﬁ eld number 3.

7. State of the qualifying investor or qualifying beneﬁ ciary set forth

in ﬁ eld number 3.

8. ZIP code of the qualifying investor or qualifying beneﬁ ciary set

forth in ﬁ eld number 3.

9. The amount of tax credits that will pass through from the

qualifying pass-through entity or qualifying trust to the

qualifying investor or qualifying beneﬁ ciary set forth in

ﬁ eld number 3 (see “Tax Credits Available to Certain Investors

and Beneﬁ ciaries” below).

If there is more than one qualifying investor or if there is more than

one qualifying beneﬁ ciary, repeat the sequence set forth in ﬁ elds

number 1 through number 9. You must repeat all nine ﬁ elds for each

additional qualifying investor or qualifying beneﬁ ciary. If you use

magnetic media, please afﬁ x to the outside of the magnetic media

a label containing the following information in large print: (i) the

name and FEIN of the qualifying pass-through entity or qualifying

trust, (ii) the phrase, “IT 1140 K-1 Information” and (iii) the phrase,

“Taxable Year Beginning in 2012.”

Tax Credits Available to Certain Investors and Beneﬁ ciaries

R.C. 5733.0611 and 5747.059 provide that qualifying investors (see

“Who Is a Qualifying Investor?” on page 3 of these instructions) can

claim an income tax or franchise tax credit based upon the qualifying

investor’s proportionate share of the withholding tax or the entity

tax that was paid on or with respect to the qualiﬁ ed investor’s direct

or indirect investment in the qualifying pass-through entity. R.C.

5747.059 also provides a similar credit for nonresident individual

qualifying beneﬁ ciaries with respect to the withholding tax that a

IT 1140

Rev. 12/12

Federal Privacy Act Notice

Because we require you to provide us with a social security ac-

count number, the Federal Privacy Act of 1974 requires us to

inform you that your providing us your Social Security number

is mandatory. Ohio Revised Code sections 5703.05, 5703.057

and 5747.08 authorize us to request this information. We need

your Social Security number in order to administer this tax.

- 11 -

Ohio Department of Taxation

Web Site – tax.ohio.gov

E-mail Us Instructions

Frequently Asked Questions Refund Status

Information Releases Tax Forms

Toll-Free Telephone Numbers

Toll-Free 24-Hour Refund Hotline 1-800-282-1784

Toll-Free Form Requests 1-800-282-1782

Toll-Free Tax Questions 1-800-282-1780

Ohio Department of Taxation

Taxpayer Services Mailing Address

Ohio Department of Taxation

Taxpayer Services Division

P.O. Box 182382

Columbus, OH 43218-2382

Ohio Department of Taxation

Taxpayer Service Center

Taxpayer Service Center Hours

Ofﬁ ce hours: 8 a.m. – 5 p.m.

Monday through Friday

4485 Northland Ridge Blvd., 1st Floor

Columbus, OH 43229-6596

Taxpayer Assistance

For the deaf, hearing-impaired or

speech-impaired who use TTY or

TDD only: Please contact the Ohio Re-

lay Service at 1-800-750-0750 or 7-1-1

and give the communication assistant

the Ohio Department of Taxation phone

number that you wish to contact.

Volunteer Income Tax Assistance

Program (VITA) and Tax Counseling

for the Elderly (TCE): These programs

help older, disabled, low-income and

non-English-speaking people ﬁ ll in their

state and federal returns. For locations

in your area, call the IRS at 1-800-829-

1040.

Written

By Phone

By Internet

Walk-in

PIT_IT1140_Instructions__2012_FS_122812 1140 PIT IT1140 Instructions

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