1040 - All states: Difference between AGI and build-up states

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What is the difference between AGI and Build-up states?


AGI states are those that begin with federal AGI or federal taxable income, and make adjustments to arrive at the AGI for state purposes. Items that have different tax treatments at the state level are either subtracted from, or added to, federal AGI to arrive at state income. Generally, AGI states in UltraTax CS have an AGI worksheet that can be used for adjustments to state amounts. If allocation is necessary between states, the allocation can be entered as a net amount at the same time federal data entry is being completed.

AGI states include: AR, AZ, CO, CT, DC, DE, GA, IA, ID, IL, IN, KS, LA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NM, NY, OH, OK, OR, RI, SC, TN, UT, VA, VT, WV

Build-up states are those that arrive at taxable income in much the same way as UltraTax/1040. Build-up states separately report all the items that make up taxable income. Some states have different definitions of various components of income, so state income is likely to be different from federal income. Generally, Build-up states in UltraTax CS have many of the same input screens that correspond with federal input screens for activities like Schedule C, Rental, K1, and so on.

Build-up states include: AL, CA, HI, KY, MA, NJ, PA, WI

Related topic: Multiple-state processing FAQs (1040)