Multiple States—partnership adjustments for state level differences

Forum|Forum|6 years ago
April 12, 2020
1 reply
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Hello,

I am a resident of Arizona and I have a partnership interest in California (non-resident). When filing my tax return for Arizona I am prompted with the option to "Enter the difference between federal and Arizona income" for this partnership that is based in California. See screenshot. Should I apply a negative adjustment here for the full income amount since this is a California partnership and will be included in my California tax return?

Multiple States

KarenM90

Level 11

It depends. If you were issued an Arizona Partnership Schedule K-1 (Form 165) and there are any differences in Income listed, you will need to list the differences on this screen.

If you were not issued an Arizona K-1 (Form 165) or there are no differences in the income from the Federal Form K-1, you will not make indicate any differences on this screen.

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dontfawiththefaAuthor

Level 2

Thanks for your response @KarenM90 . Just clarify... I received a California K1 from this partnership interest along with a federal K1. I did not receive an Arizona K1. In addition there are no differences from my California and federal K1.

Based on your reply please confirm that I will not indicate any differences here.

DavidS127

Level 13

Because you did not receive an Arizona Form 165 Schedule K-1, there is no adjustment for you to enter.

The Arizona instructions are specific to the Arizona Form 165 Schedule K-1. Your partnership is a California partnership, and presumably did not operate in Arizona and thus was not required to file Arizona Form 165. In other words, no Arizona Form 165 Schedule K-1, no difference to enter.

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