1120-US: Calculating the allocation of expanded affiliated group's total DPAD (FAQ)

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IRS filing deadline update

The IRS MeF system is now processing returns, and the filing deadline has been extended to 11:59 PM on Wednesday, April 18, 2018. For the latest details, see UltraTax CS alerts and notices.


How does UltraTax/1120 calculate the allocation of expanded affiliated group's total DPAD to its members?


Per the form instructions, the EAG's DPAD is allocated among the members of the EAG in proportion to each member's QPAI. The allocation is made regardless of whether the EAG member has taxable income or W-2 wages for the tax year. If a member has negative QPAI, that member's QPAI is treated as zero, and therefore the member will not be allocated a portion of the EAG's DPAD.

UltraTax/1120 completes this calculation on the Expanded Affiliated Group DPAD Allocation Worksheet for reporting members of the EAG.

Related topic: 1120-US: Form 8903 - Domestic production deduction FAQs

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