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-   -   Florida Corp has partnership interest in LLC bin another state. (https://www.askmehelpdesk.com/showthread.php?t=698544)

  • Aug 31, 2012, 08:58 PM
    pelicanquest
    Florida Corp has partnership interest in LLC bin another state.
    A Florida C Corp has a partnership interest in an LLC in another state as an investment, not as part of business operation. Otherwise, all business is in Florida. Should the K1 income from the partnership be taxable in Florida?
  • Sep 1, 2012, 08:26 AM
    MLSNC
    I am not familiar with Florida corporate taxation so understand that upfront. Since you have used the word “investment” I get the feeling that you may feel the partnership income is not currently taxable. I do not feel that is correct. You will be responsible for reporting the income that the K-1 shows. However, if the income reported on the K-1 is only interest and dividends, then you will probably not be required to file a return for that state. As a general rule multi-state corporations have to allocate income based on sales, payroll and fixed assets. Not quite as simple as an individual return. That being said. If you only operate in Florida, and the partnership is your only out-of-state income, you may be able to report just the partnership income on a corporate return for that state. You also may run into different issues of you are a C Corp or an S Corp. Multi-state returns can get complicated, and you may wish to obtain a professional that is familiar with Florida taxation to review your situation.
  • Sep 5, 2012, 09:47 AM
    pelicanquest
    Thanks... that's what I was wondering. We are a C Corp and the income was already reported to the state that the LLC is in. But we don't do any business outside Florida so I didn't think it could be allocated since the return indicates you can only do that if you do business out of state. As I said, the partnership K1 is from an investment, the c corp wasn't actively participating in the business of the LLC.

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