2016 Partnership Instructions change

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2016 Partnership Instructions change


There is an important change to the Schedule KPI portion of the general partnership instructions for 2016. See KPI, line 23 on Page 10 of the Partnership Form M3 Instructions. Prior instructions directed partnerships to allocate guaranteed payments for services to Minnesota if the services were performed in Minnesota. This instruction was incorrect. Guaranteed payments, like other amounts of distributive share, should be allocated to Minnesota using the same apportionment percentage or assignment ratio used to allocate partnership income. See Minnesota Rules 8002.0200, subpart 3.


In cases where partnerships have reasonably relied on the incorrect instruction to prepare their return or calculate their withholding position, the department will waive any assessed penalties.


If you have questions concerning the instructions update, please contact the Partnership Tax Unit at (651) 556-3075.