42.26.229    PARTNERSHIPS AND DISREGARDED ENTITIES - NONAPPORTIONABLE INCOME

(1) A partnership or disregarded entity that is not part of a unitary business operation of a corporate partner or disregarded entity owner will be treated as follows:

(a) The corporate partner's or disregarded entity owner's share of partnership or disregarded entity income will not be included in apportionable income to be apportioned, but allocated to the states where the partnership or disregarded entity operates based upon the apportionment formula outlined in 15-31-305, MCA.

(2) Gain or loss from the sale of a non-unitary partnership or disregarded entity owner interest is allocable to this state in the ratio of the original cost of partnership or disregarded entity tangible property in this state to the original cost of partnership or disregarded entity tangible property everywhere, determined at the time of sale. In the event that more than 50 percent of the value of the assets of a partnership or disregarded entity consists of intangibles, gain, or loss from the sale of the partnership or disregarded entity owner interest shall be allocated to this state in accordance with the receipts factor of the partnership or disregarded entity for its first full tax period immediately preceding its tax period during which the partnership or disregarded entity interest was sold. If a disregarded entity does not have a tax period, the allocation will be made in accordance with the receipts factor of the partnership or disregarded entity for the 12 full calendar months preceding the month the interest was sold.

 

History: 15-31-501, MCA; IMP, 15-31-304, 15-31-305, MCA; NEW, 1988 MAR p. 1541, Eff. 7/15/88; AMD, 2001 MAR p. 2469, Eff. 12/21/01; AMD, 2002 MAR p. 3708, Eff. 12/27/02; AMD, 2017 MAR p. 2328, Eff. 1/1/18.