2000 Minnesota Statutes

     290.9726 Corporation taxable income taxed to 
  shareholders. 

    Subdivision 1.    General rule.  The gross income of the 
 shareholders of corporations described in section 290.9725 shall 
 be computed under the provisions of section 290.01, subdivision 
 20.  

    Subd. 2.    Character of items distributed or considered 
 distributed.  The character of any item of income, gain, loss, 
 or deduction included in shareholder's income, for the period of 
 time that the shareholder is not a resident of Minnesota, shall 
 be determined as if the item were realized directly from the 
 source from which it was realized by the corporation or incurred 
 in the same manner as incurred by the corporation.  

    Subd. 3. Repealed, 1987 c 268 art 1 s 127 

    Subd. 4.    Treatment of family groups.  Any amount of 
 taxable income apportioned or allocated to a shareholder may be 
 reapportioned or reallocated under the provisions of section 
 1366(e) of the Internal Revenue Code if the commissioner 
 determines it necessary in order to correctly reflect the value 
 of services rendered to the corporation by the shareholders.  

    Subd. 5. Repealed, 1987 c 268 art 1 s 127 

    Subd. 6. Repealed, 1987 c 268 art 1 s 127 

    Subd. 7.    Financial institutions.  An S corporation 
 that is subject to the tax under section 290.9725, clause (2), 
 must report to each shareholder an apportionment of the S 
 corporation's tax obligation for the taxable year for purposes 
 of the credit under section 290.06, subdivision 26.  The 
 apportionment to a shareholder must be made in proportion to the 
 amount of taxable income of the S corporation apportioned to the 
 shareholder. 

    HIST: 1982 c 523 art 1 s 61; 1983 c 207 s 39,40,43; 1983 c 342 
 art 1 s 43; 1984 c 514 art 1 s 8; art 4 s 9; 1985 c 210 art 2 s 
 8; 1Sp1985 c 14 art 21 s 49; 1986 c 444; 1Sp1986 c 1 art 1 s 9; 
 1987 c 268 art 1 s 114-116; 1988 c 719 art 3 s 12; 1989 c 28 s 
 25; 1990 c 604 art 2 s 16; 1991 c 291 art 6 s 46; 1992 c 511 art 
 6 s 19; 1993 c 375 art 8 s 14; 1994 c 587 art 1 s 24; 1999 c 243 
 art 2 s 27