Excess net Passive Income TaxSurplus of net income tax liabilities
Notes on the net income tax liability surplus
Which is a surplus passive net income tax (ENPI)? Net income tax liabilities: An entity must owe the ENPI tax if all of the following applies: At the end of the tax year, it had cumulative gains and losses (E&P). Passive investment income for the tax year is available, accounting for more than 25% of gross income.
These include portfolio income from Annex K, which is regarded as a passive result for S-corporations. At the end of the year, it has a rateable income (using the C Corporation method of computation, not the S Corporation rules). Income liabilities are included in the ENPI calculation: Portfolio-related income, which may include interest, dividends, royalties, capital gains, etc. Profit from the sale or exchange of securities (the Stock or Securities for passive net income tax checkbox in Screen 23, arrangements must be reviewed for these arrangements).
Excess passive net income liable to tax is restricted to income to be taxed, as if it were still a Cporation. ENPI thresholds are set when the EPI is more than 25% of GDP and the company has E&P at the end of the year.
ENPI spreadsheet, which describes the calculation of the tax in detail. These worksheets can be consulted and are printed when the company is held responsible. Passive income positions are entered into the ENPI spreadsheet if they have been entered properly. In Screen 37, Federal Taxes, there are surrenders under the Excess Net Passive Income Tax section that can be used to surrender any of the spreadsheet sums ( "Each passive income forwarded to shareholders is deducted by their portion of the tax to row 22a").
Also, the software computes the income to be taxed as if it were a C corporation. Creates a spreadsheet entitled Corp Tax Inc. that can be reviewed and printed when the ENPI tax is in effect. In addition, there are two entry points that indicate that the group has a balance sheet result (Accumulated Earnings and Profit, E&P), each of which triggers this computation.
You will find one of them in Screen 3, Other Info/Other Info under the Cumulated Winnings and Year End Winnings boxes. You can find the other site in Screen 32, Federal List M-2 in the Other Revenue Reserves section (Table L) in the Transfer to Other Revenue Reserves[A] area.