| (vi) other amounts authorized by subsection (e) of
this section.
(2) S corporations. For the purpose of computing its
taxable margin, the total revenue of a taxable entity treated as an
S corporation for federal income tax purposes is computed by:
(A) adding:
(i) the amount reportable as income on line 1c, Internal
Revenue Service Form 1120S;
(ii) the amounts reportable as income on lines 4 and
5, Internal Revenue Service Form 1120S;
(iii) the amounts reportable as income on lines 3a
and 4 through 10, Internal Revenue Service Form 1120S, Schedule K;
(iv) the amounts reportable as income on lines 17 and
19, Internal Revenue Service Form 8825; and
(v) any total revenue reported by a lower tier entity
as includable in the taxable entity's total revenue under Tax Code, §171.1015(b);
and
(B) subtracting, to the extent included in the calculation
under subparagraph (A) of this paragraph:
(i) bad debt expensed for federal income tax purposes
that corresponds to items of gross receipts included for the current
reporting period or a past reporting period;
(ii) foreign royalties and foreign dividends, including
amounts determined under Internal Revenue Code, §78 or §§951
- 964;
(iii) net distributive income from a taxable entity
treated as a partnership or as an S corporation for federal income
tax purposes, except as provided by subsection (c)(4) of this section;
(iv) items of income attributable to an entity that
is a disregarded entity for federal income tax purposes; and
(v) other amounts authorized by subsection (e) of this
section.
(3) Partnerships. For the purpose of computing its
taxable margin, the total revenue of a taxable entity treated as a
partnership for federal income tax purposes is computed by:
(A) adding:
(i) the amount reportable as income on line 1c, Internal
Revenue Service Form 1065;
(ii) the amounts reportable as income on lines 4, 6,
and 7, Internal Revenue Service Form 1065;
(iii) the amounts reportable as income on lines 3a
and 5 through 11, Internal Revenue Service Form 1065, Schedule K;
(iv) the amounts reportable as income on line 17, Internal
Revenue Service Form 8825;
(v) the amounts reportable as income on line 11, plus
line 2 or line 45, Internal Revenue Service Form 1040, Schedule F;
and
(vi) any total revenue reported by a lower tier entity
as includable in the taxable entity's total revenue under Tax Code, §171.1015(b);
and
(B) subtracting, to the extent included in the calculation
under subparagraph (A) of this paragraph:
(i) bad debt expensed for federal income tax purposes
that corresponds to items of gross receipts included for the current
reporting period or a past reporting period;
(ii) foreign royalties and foreign dividends, including
amounts determined under Internal Revenue Code, §78 or §§951
- 964;
(iii) net distributive income from a taxable entity
treated as a partnership or as an S corporation for federal income
tax purposes, except as provided by subsection (c)(4) of this section;
(iv) items of income attributable to an entity that
is a disregarded entity for federal income tax purposes; and
(v) other amounts authorized by subsection (e) of this
section.
(4) Trusts. For the purpose of computing its taxable
margin, the total revenue of a taxable entity treated as a trust for
federal income tax purposes is computed by:
(A) adding:
(i) the amount reportable as income on lines 1, 2a,
3, 4, 7, and 8 of Internal Revenue Service Form 1041;
(ii) the amount reportable as income on lines 3, 4,
32, and 37 of Internal Revenue Service Form 1040, Schedule E;
(iii) the amounts reportable as income on line 11,
plus line 2 or line 45, Internal Revenue Service Form 1040, Schedule
F; and
(iv) any total revenue reported by a lower tier entity
as includable in the taxable entity's total revenue under Tax Code, §171.1015(b);
and
(B) subtracting, to the extent included in the calculation
under subparagraph (A) of this paragraph:
(i) bad debt expensed for federal income tax purposes
that corresponds to items of gross receipts included for the current
reporting period or a past reporting period;
(ii) foreign royalties and foreign dividends, including
amounts determined under Internal Revenue Code, §78 or §§951
- 964;
(iii) net distributive income from a taxable entity
treated as a partnership or as an S corporation for federal income
tax purposes, except as provided by subsection (c)(4) of this section;
(iv) items of income attributable to an entity that
is a disregarded entity for federal income tax purposes; and
(v) other amounts authorized by subsection (e) of this
section.
(5) Single member limited liability company (LLC) filing
as a sole proprietorship. For the purpose of computing its taxable
margin, the total revenue of a taxable entity registered as a single
member limited liability company and filing as a sole proprietorship
for federal income tax purposes is computed by:
(A) adding:
(i) the amount reportable as income on line 3 of Internal
Revenue Service, Form 1040, Schedule C;
(ii) the amount reportable as income on line 17, Internal
Revenue Service Form 4797, to the extent that it relates to the LLC;
(iii) ordinary income or loss from partnerships, S
corporations, estates and trusts, Internal Revenue Service Form 1040,
Schedule E, to the extent that it relates to the LLC;
(iv) the amount reportable as income on line 16 of
Internal Revenue Service Form 1040, Schedule D, to the extent that
it relates to the LLC;
(v) the amounts reportable as income on lines 3 and
4, Internal Revenue Service Form 1040, Schedule E, to the extent that
it relates to the LLC;
(vi) the amounts reportable as income on line 11, plus
line 2 or line 45, Internal Revenue Service Form 1040, Schedule F,
to the extent that it relates to the LLC;
(vii) the amount reportable as income on line 6 of
Internal Revenue Service Form 1040, Schedule C, that has not already
been included in this subparagraph; and
(viii) any total revenue reported by a lower tier entity
as includable in the taxable entity's total revenue under Tax Code, §171.1015(b);
and
(B) subtracting, to the extent included in the calculation
under subparagraph (A) of this paragraph:
(i) bad debt expensed for federal income tax purposes
that corresponds to items of gross receipts included for the current
reporting period or a past reporting period;
(ii) foreign royalties and foreign dividends, including
amounts determined under Internal Revenue Code, §78 or §§951
- 964;
(iii) net distributive income from a taxable entity
treated as a partnership or as an S corporation for federal income
tax purposes, except as provided by subsection (c)(4) of this section;
(iv) items of income attributable to an entity that
is a disregarded entity for federal income tax purposes; and
(v) other amounts authorized by subsection (e) of this
section.
(6) Other taxable entities. For a taxable entity other
than a taxable entity treated for federal income tax purposes as a
corporation, S corporation, partnership, trust, or single member limited
liability company filing as a sole proprietorship, the total revenue
will be an amount determined in a manner substantially equivalent
to the amount calculated for the entities listed in this subsection.
(e) Exclusions from total revenue. Except as otherwise
provided in this section and only to the extent included in the calculation
of total revenue under subsection (d)(1) - (6) of this section, the
following items shall be excluded from total revenue:
(1) Flow-through funds mandated by law or fiduciary
duty. Flow-through funds that are mandated by law or fiduciary duty
to be distributed to other entities or persons, including taxes collected
from a third party by the taxable entity and remitted by the taxable
entity to a taxing authority;
(A) Allowed exclusions include, but are not limited
to, taxes imposed by law on a third party but collected by the taxable
entity and remitted by it to a taxing authority. Examples include,
but are not limited to, state sales tax and the Texas hotel occupancy
tax.
Cont'd... |
