Preparing Florida returns when the state and federal groups are different and there are no members with at-risk or passive activities

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Use this procedure to ensure the correct preparation of Florida consolidated income tax returns if the members of the Florida unitary business group are not the same as those included in the federal consolidated group and the federal group does not contain members with at-risk or passive activities.

  1. Add Florida to the parent client and the applicable subsidiary clients. Complete all data entry for these member clients. Each member's state return should be complete and correct before proceeding to the next step.

    Note: Apportionment data entry must be completed for each member client, even if the client is 100 percent in-state. The same apportionment method must be used by the parent client and applicable subsidiary clients. Apportionment data entry is accessed through View > Apportionment.

  2. Create a new eliminations client for Florida purposes and add Florida to the client. Complete this client before proceeding to the next step. If an eliminations client was part of the federal consolidated group, a new state eliminations client is needed because the eliminations client used in the federal consolidated group may include eliminations involving members that are not to be included in the Florida consolidated group.

    Note: Including an eliminations client as part of a consolidated group is optional.

  3. Clone the existing federal consolidated client. Open the federal consolidated client, choose File > Save As, enter a new client ID for the client, and click the Save button. This new client has the same EIN and name as the federal consolidated client, but is used for Florida purposes only. This is the consolidated client from which UltraTax CS generates the Consolidated Form F-1120.
  4. Select the appropriate members to be included in the Florida consolidated group. Choose File > Client Properties and click the Advanced Properties button. In the Group tab, remove or add subsidiary clients as necessary. If applicable, remove the current eliminations client that was used by the federal client and then add the eliminations client created in step 2. Click OK to close the Advanced Properties dialog. Click OK again to close the Client Properties dialog.
  5. Add Florida to the new consolidated client.

    Note: When adding Florida to a consolidated federal client, the state automatically defaults to being a consolidated return.

    If the state is added as a C Corporation to a federal consolidated group, the consolidated functionality does not take place. The amounts from each member are not consolidated, and the consolidated reports are not available.

  6. Review all Florida consolidated client input screens and complete any necessary remaining data entry. For each category not marked in the File > Client Properties > Advanced Properties > Options dialog, enter the necessary data in the applicable input screens.

    Note: If a category is not marked, enter the data on the applicable input screens in the Consolidated client. For a list of categories and related input screens, see Categories and related Florida input screens.

    Any changes made to the File > Client Properties > Advanced Properties > Options dialog affect both the federal and state return.

  7. Click the Consolidated input screen folder. Complete the necessary information in Screens FLAffil and FLCAdj.
  8. To file Form F-1122, Authorization and Consent of Subsidiary Corporation to be Included in a Consolidated Income Tax Return, for a particular member of the consolidated group, mark the Required to file Form F-1122 field in Screen FLAffil for that member. This defaults to the federal selection for each member.
  9. To make manual adjustments in other areas of the return, click the Group View button or press F7 in the input screen field you want to adjust, and then enter the adjustment amount in the Group View dialog.
  10. To change amounts entered in the Florida parent, eliminations, or subsidiary clients, go back to the original source of data entry. For instance, if you made a mistake when you entered the apportionment of the first subsidiary, close the consolidated client and reopen the first subsidiary. Choose View > Apportionment for that client and correct the data. Close the subsidiary client and reopen the consolidated client. The correct amount is now a part of the consolidated group return.
  11. Print and review the Florida consolidated tax return.

Example of when a Florida group is different from a federal consolidated group and the federal group does not contain members with at-risk or passive activities.

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