DOCSLIB.ORG

Introducing the Foreign-Invested Partnership

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Introducing the Foreign-Invested Partnership Chinae BusinSeptember-Octoberess 2010 Review The PRC Partnership Enterprise Law permits foreign investors to establish general or limited partnerships. Introducing the Foreign-Invested Partnership There’s a new option for structuring foreign investment in China, and it may offer companies greater flexibility. Paul McKenzie, Thomas Chou, Adam Kearney, and Charles Coker oreign investors have pursued establishing joint (FIP measures) and the Administrative Provisions on the ventures (JVs) and, later, wholly foreign-owned Registration of Foreign-Invested Partnership Enterprises (FIP enterprises (WFOEs), since the inception of registration procedures), both of which took effect March 1, China’s foreign-investment boom more than 30 2010, there is a new structure to consider: the foreign-invest- years ago. Now, with the recent release of the ed partnership (FIP). Administrative Measures on the Establishment of Partnership The FIP option and its implementing regulations repre- FEnterprises in China by Foreign Enterprises or Individuals sent the culmination of PRC government efforts over the chinabusinessreview.com September–October 2010 1 FOCUS: INVESTMENT VEHICLES past three years to expand the scope of foreign-investment nized capital contributions compared to the more restrictive legislation to include partnership entities under the 2006 rules for EJVs, CJVs, and WFOEs. In addition to cash and PRC Partnership Enterprise Law. These developments, in-kind contributions, labor services may also be contributed though monitored most closely by the private equity and to a partnership, provided that the contributor is not a limit- real estate investment community, suggest new investment ed partner. In practice, services are often contributed by one structure options for a broad range of foreign investors and or more partners, particularly in a limited partnership where businesses in China. In fact, the first FIP to be registered the general partner manages cash contributions of the limited under the new regulations, the Jiangsu-based Kunshan Sun partners. Partnerships are also exempt from the 70 percent City Gardening Center, involves plant nurseries and gar- cap on the contribution of non-cash assets applicable to dening supplies rather than the fund for- foreign-invested enterprises (FIEs) and mation activities that have been widely Quick Glance other domestic companies under the PRC anticipated by foreign observers. Company Law—a key consideration for ■ China’s new investment high-tech start-ups, where intangibles often A closer look at FIPs option—foreign-invested represent the bulk of a venture’s assets. The basic contours of a partnership in partnerships—generally provides Finally, unlike the situation for corporate China are similar to partnership structures more flexibility than cooperative or FIEs, the payment of contributions in a in other countries, though China may pass equity joint ventures. partnership is not subject to statutory time legislation to clarify certain details in the ■ The related Partnership limits, which in turn facilitates “just-in- coming years. Broadly speaking, a partner- Enterprise Law guides investors on time” deployment of capital contributions. ship provides more structural flexibility partnership forms, capitalization Observers expect this feature to be critical than equity joint ventures (EJV), coopera- requirements, profit and dividend for investment fund partnerships as a means tive joint ventures (CJV), and other invest- distribution, management of enhancing the capital efficiency of fund ment vehicles (see p.14). The law provides structure and governance, and tax operations and internal rates of return. guidance in five critical areas. treatment. Beyond investment funds, the flexible ■ PRC regulations are unclear capitalization rules for partnerships may Partnership forms about the new structure’s approval prove useful for small enterprises for which The Partnership Enterprise Law pro- processes and downstream corporate FIE forms can be ill-suited and vides for two basic forms: general partner- investment options, however. cumbersome. The first batch of registered ships under which all partners undertake FIPs, in March 2010, included not only unlimited liability for the debts of the investment funds and managers, such as the partnership; and limited partnerships consisting of at least Fosun-Carlyle (Shanghai) Equity Investment Fund and one general partner and one or more limited partners. Softbank-affiliated Shanghai Xinchuang Equity Investment Limited partners generally do not participate in the daily Management Co., but also small and medium-sized non- management of the entity’s affairs and are liable for debts of financial enterprises such as plant nurseries and consultancies. the partnership only to the extent of their capital contribu- tions to the partnership. Accordingly, limited partnership Flexibility of profit and dividend distribution vehicles may be particularly relevant for forming invest- In some ways, the FIP structure is more flexible than the ment funds, with the fund sponsor assuming the role of JV structure. A key aspect of EJVs is the rigid linkage general partner and passive financial investors taking inter- between capital contributions and profit distribution. Each ests as limited partners. Certain early renminbi (RMB) investor is entitled to a pro rata share of profits strictly in fund test cases have made use of the limited partnership accordance with their pro rata contribution of equity. option, though others have been set up in the form of a Foreign investors requiring more flexibility have formed general partnership. CJVs, which permit the investors, subject to foreign invest- Interestingly, the Partnership Enterprise Law also provides ment approvals, some discretion in adjusting the linkage for “special” general partnerships for professional services between capital contributions and profit shares. Though firms such as law firms and accountancies. Preliminary indica- originally used principally for natural resource development tions suggest that additional legislative and regulatory devel- projects, the CJV has become increasingly popular in recent opments on professional services partnerships are pending. years for real estate-related investments. In addition, several onshore venture capital funds set up under the PRC Capitalization Ministry of Commerce’s (MOFCOM) foreign-invested Partnerships, including FIPs, are not subject to statutory venture capital enterprise (FIVCE) scheme have made use minimum capitalization requirements. The Partnership of the non-legal person CJV, given the unavailability of a Enterprise Law provides for a more liberal scope of recog- limited partnership vehicle. 2 September–October 2010 chinabusinessreview.com Though CJVs have served as a workable solution in Pass-through tax treatment some cases, provided that requisite foreign investment The Partnership Enterprise Law exempts partnerships approvals are forthcoming, a limited partnership affords from income tax at the enterprise level; partnerships are investors the ability to structure their interest-sharing rela- subject to pass-through taxation, whereby each partner is tionship without any reference to capitalization. This flexi- responsible for income tax on its share of the partnership’s bility is critical to setting up the kind of carried-interest income instead. Currently, entities with legal person status, arrangements that are typically the centerpiece of invest- such as FIEs that may be established as general partners of ment-fund structures. It may also come into play for other an onshore partnership, are subject to a 25 percent enter- closely held businesses where value-added strategic relation- prise income tax, while individuals are subject to a graduat- ships play an important role. ed income tax. Neither the Partnership Enterprise Law nor A limited partnership affords investors the ability to structure their interest-sharing relationship without any reference to capitalization. Management structure and governance the FIP measures address the question of how a foreign All FIPs require the preparation and registration of a part- limited partner’s interest in an FIP is to be taxed in China. nership agreement that sets out the governance arrangements Under general tax rules applicable to foreign taxpayers, of the partnership, as well as other key details. Though the withholding tax would apply. Partnership Enterprise Law requires certain specified coverage The venture capital and private equity community has in a partnership agreement, including governance provisions, welcomed the additional clarity provided by the Partnership the law offers a great deal of flexibility in structuring these Enterprise Law on pass-through taxation. In practice, exist- provisions. For example, Article 31 enumerates certain mat- ing onshore venture capital funds established under the ters as subject to unanimous partnership consent but pro- FIVCE regime in non-legal person CJV form have in many vides for an opt-out under which a partnership agreement cases been able to obtain pass-through taxation on a case- may provide for alternative procedures. A similar approach by-case basis with special approval. The legal basis and applies to other vital matters such as profit distribution and availability of such treatment has been a murky area, how- admission of new partners. At the same time, the Partnership ever. The PRC State Administration of Taxation and Enterprise Law provides partners with
Load more

Recommended publications
  • CHAPTER 449. PARTNERSHIPS UNIFORM PARTNERSHIP ACT Act
    CHAPTER 449. PARTNERSHIPS UNIFORM PARTNERSHIP ACT Act 72 of 1917 AN ACT to define partnerships; the relation of partners to persons dealing with the partnership; the relation of partners to one another; to provide for the dissolution and winding up of partnerships; to prescribe powers and duties of certain state agencies and officials; and to make uniform the law relating to partnerships. History: 1917, Act 72, Eff. Aug. 10, 1917;Am. 1994, Act 323, Imd. Eff. Oct. 12, 1994. The People of the State of Michigan enact: PART I PRELIMINARY PROVISIONS. 449.1 Uniform partnership act; short title. Sec. 1. (Name of act). This act may be cited as uniform partnership act. History: 1917, Act 72, Eff. Aug. 10, 1917;CL 1929, 9841;CL 1948, 449.1. Compiler's note: The catchlines in parentheses following the act section numbers of this act were incorporated as part of the act when enacted. 449.2 Uniform partnership act; definitions. Sec. 2. (Definition of terms). In this act, “court” includes every court and judge having jurisdiction in the case; “business” includes every trade, occupation, or profession; “person” includes individuals, partnerships, corporations, and other associations; “bankrupt” includes bankrupt under the federal bankruptcy act or insolvent under any state insolvent act; “conveyance” includes every assignment, lease, mortgage, or incumbrance; “real property” includes land and any interest or estate in land. History: 1917, Act 72, Eff. Aug. 10, 1917;CL 1929, 9842;CL 1948, 449.2. 449.3 Uniform partnership act; interpretation of knowledge
    [Show full text]
  • IBFD China-Partnership-Edited by IBFD
    National Real Estate Industry Practice Partnerships in China: The New Frontier* By Nancy Marsh, Jeff Kadet, Bill Ye and Grace Wang August 2008 The Partnership Enterprise Law took effect in 2007 and the article analyses the various types of partnership entities and the opportunities offered. The authors also discuss the tax issues affecting such entities. 1. INTRODUCTION Recent improvements in the laws governing business entities signal a new phase in China’s progress toward a more flexible investment environment. These improvements include China’s amended Partnership Enterprise Law (PEL), enacted in 2006 and effective from 1 June 2007. Before the PEL entered into effect, a partnership could only have individual partners and was thus of little interest to most domestic and foreign investors. In contrast, under the new law, a partnership may not only have partners that are domestic legal entities, but also foreign partners, whether individual or corporate. The Chinese government has clearly gone to considerable lengths to review partnership laws in other countries with a view to creating a flexible Chinese partnership vehicle and is to be applauded for its efforts. Although no guidance addressing how a foreign individual or company can become a * © Nancy Marsh, Jeff Kadet, Bill Ye and Grace Wang. Nancy Marsh is a tax partner at the Beijing office of Deloitte Touche Tohmatsu CPA Ltd., China and the leader of the China Real Estate Tax Group. Jeffery Kadet is a senior advisor at the Shanghai office, Bill Ye is a senior manager at the Atlanta office and Grace Wang is a manager at the Shanghai office.
    [Show full text]
  • Entity Classification
    ENTITY CLASSIFICATION Kimberly Blanchard TLHE SIGNIFICEANCE OF GAL Many countries employ the term nerships, whether general or lim - “legal personality” to differentiate ited partnerships, might be con - an entity treated as a separate sidered to possess the attribute corporate taxpayer from a tax- of legal personality, and if so transparent partnership. In these might be treat ed as corporations countries it is sometimes said that for tax purposes in the client’s a corporation has legal person - country of residence. This hybrid ality, whereas a partnership does result can raise a variety of tax not. The author first encountered problems, including the loss of the term legal personality in the treaty benefits otherwise avail - course of advising foreign clients able, 1 the potential for timing and who were considering invest - character mismatches, and the ments in U.S. partnerships. The potential loss of credibility or concern raised by their non-U.S. exemption at home for U.S. taxes tax advisors was that U.S. part - paid by the nonresident partner. 4 BUSINESS ENTITIES March/April 2016 FOR U.S. TAX PURPOSES WHILE THE CONCEPT OF LEGAL PERSONALITY REMAINS AN IMPORTANT FACTOR IN MANY OTHER COUNTRIES, THE UNITED STATES HAS ABANDONED ANY CONCEIT THAT IT MATTERS TO ENTITY CLASSIFICATION FOR TAX PURPOSES. BUSINESS ENTITIES 5 Background term at all. The resulting tension In researching the issue, it soon became between tax systems can give rise to clear that virtually every type of U.S. hybrid entities, frustrating interna - entity that exists today, including a tional efforts to eliminate hybridity in simple general partnership, probably order to minimize classification con - has what many other countries would flicts and the resulting possibility of view as legal personality.
    [Show full text]
  • UNIFORM PARTNERSHIP ACT (1997) (Last Amended 2013)
    UNIFORM PARTNERSHIP ACT (1997) (Last Amended 2013) Drafted by the NATIONAL CONFERENCE OF COMMISSIONERS ON UNIFORM STATE LAWS and by it APPROVED AND RECOMMENDED FOR ENACTMENT IN ALL THE STATES at its ANNUAL CONFERENCE MEETING IN ITS ONE-HUNDRED-AND-TWENTY-SECOND YEAR BOSTON, MASSACHUSETTS JULY 6 - JULY 12, 2013 WITH PREFATORY NOTE AND COMMENTS COPYRIGHT © 2014 By NATIONAL CONFERENCE OF COMMISSIONERS ON UNIFORM STATE LAWS August 19, 2015 ABOUT ULC The Uniform Law Commission (ULC), also known as National Conference of Commissioners on Uniform State Laws (NCCUSL), now in its 123rd year, provides states with non-partisan, well-conceived and well-drafted legislation that brings clarity and stability to critical areas of state statutory law. ULC members must be lawyers, qualified to practice law. They are practicing lawyers, judges, legislators and legislative staff and law professors, who have been appointed by state governments as well as the District of Columbia, Puerto Rico and the U.S. Virgin Islands to research, draft and promote enactment of uniform state laws in areas of state law where uniformity is desirable and practical. • ULC strengthens the federal system by providing rules and procedures that are consistent from state to state but that also reflect the diverse experience of the states. • ULC statutes are representative of state experience, because the organization is made up of representatives from each state, appointed by state government. • ULC keeps state law up-to-date by addressing important and timely legal issues. • ULC’s efforts reduce the need for individuals and businesses to deal with different laws as they move and do business in different states.
    [Show full text]
  • Chinese Partnership
    CHINESE PARTNERSHIP FANG LIUFANG* TRANSLATED BY XIA YUANTAO, SANG BINXUE, AND DANIAN ZHANG I INTRODUCTION: CHINESE PARTNERSHIP IN HISTORY As early as the Spring and Autumn period (770-476 B.C.), Guan Zhong' (?-645 B.C.) established a business partnership with his close friend Bao Shuya in Nan Yang. After he had become an important political figure, Guan Zhong recalled this period with great emotion. He said, "[w]hen I was poor, I did business with Bao Shuya. Although I retained most of the profits, Bao never saw me as greedy. He was aware of my poverty." 2 This unusual friendship has been appreciated by many generations of Chinese. People still refer to friends who have full confidence in one another as "a friendship between Guan and Bao." Few Chinese, however, ever thought of such friendship as a model partner relationship. By receiving most of the profits, Guan was actually taking other partners' interests, a practice characterized as "societa lenina" (the lion's share) under Roman law, and behavior considered immoral by Chinese standards. As for Bao, he could have rightfully asked for a return of the profits taken by Guan Zhong, but because he knew that Guan's family was poor, he was willing to sacrifice. Therefore, partners put a greater priority on the personal relationship between themselves than on profits. Sima Xiangru (179-117 B.C.), the famous scholar of the Western Han Dynasty, and his fiancee, Zhuo Wenjun, went through a difficult period after they had run away to get married. They had "nothing but the bare walls of their house." 3 They first had to sell all their carriages and horses, and then bought a bar, of which Zhuo Wenjun was the proprietress.
    [Show full text]
  • 225 DEBT WORKOUTS: the PARTNERSHIP and the PARTNERS James B. Sowell
    225 DEBT WORKOUTS: THE PARTNERSHIP AND THE PARTNERS James B. Sowell KPMG LLP © 2012 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. This outline is based, in part, on an article entitled Partnership Workouts: Is It That Time Again? that previously was published at 42 Tax Mgmt. Memo. (BNA) 414 (Sept. 10, 2001). That article was then expanded upon in Troubled Partnerships: Debt Workouts and Other Issues, 62 NYU Inst. on Fed. Tax’n 12-1 (2004). Copyright Tax Management, Inc., a Bloomberg BNA Company. Reprinted with permission. If you find this article helpful, you can learn more about the subject by going to www.pli.edu to view the on demand program or segment for which it was written. 225-1 225-2 James Sowell James Sowell is a principal in the Passthroughs group of the Principal Washington National Tax Washington National Tax practice of KPMG LLP. He focuses Direct line: 202-533-5710 Fax: 202-403-3821 primarily on tax issues relating to partnerships and REITs, and he E-mail: [email protected] leads the Real Estate practice for Washington National Tax. Prior to joining KPMG, Jim was with the national tax offices of other major accounting firms. Prior to that time, Jim was with the U.S. Department of Treasury (Office of Tax Policy) where he served first as an Attorney Advisor and then as an Associate Tax Legislative Counsel. While at the Treasury Department, Jim was primarily responsible for administrative guidance and legislation involving partnerships, real estate investment trusts, like-kind exchanges, and other issues.
    [Show full text]
  • Limited Liability Partnership Act Amendments to Uniform Partnership Act (1994)
    D R A F T FOR APPROVAL LIMITED LIABILITY PARTNERSHIP ACT AMENDMENTS TO UNIFORM PARTNERSHIP ACT (1994) NATIONAL CONFERENCE OF COMMISSIONERS ON UNIFORM STATE LAWS MEETING IN ITS ONE-HUNDRED-AND-FIFTH YEAR SAN ANTONIO, TEXAS JULY 12 - JULY 19, 1996 LIMITED LIABILITY PARTNERSHIP ACT AMENDMENTS TO UNIFORM PARTNERSHIP ACT (1994) WITH COMMENTS Copyright 1996 By NATIONAL CONFERENCE OF COMMISSIONERS ON UNIFORM STATE LAWS The ideas and conclusions herein set forth, including drafts of proposed legislation, have not been passed on by the National Conference of Commissioners on Uniform State Laws. They do not necessarily reflect the views of the Committee, Reporters or Commissioners. Proposed statutory language, if any, may not be used to ascertain legislative meaning of any promulgated final law. DRAFTING COMMITTEE ON LIMITED LIABILITY PARTNERSHIP ACT HARRY J. HAYNSWORTH, IV, William Mitchell College of Law, 875 Summit Avenue, St. Paul, MN 55105, Chair ANN E. CONAWAY ANKER, Widener University, School of Law, P.O. Box 7474, Wilmington, DE 19803 REX BLACKBURN, Suite 200, 1101 West River Street, P.O. Box 959, Boise, ID 83701 STANLEY M. FISHER, 1100 Huntington Building, Cleveland, OH 44115 REED L. MARTINEAU, P.O. Box 45000, 10 Exchange Place, Salt Lake City, UT 84145 FRANCIS J. PAVETTI, P.O. Box 829, Court House Square Building, New London, CT 06320 JOHN M. SPANGLER, Legislative Research Commission, Room 409, State Capitol, Frankfort, KY 40601 HOWARD J. SWIBEL, Suite 1200, 120 South Riverside Plaza, Chicago, IL 60606 JUSTIN L. VIGDOR, 2400 Chase Square, Rochester, NY 14604 CARTER G. BISHOP, Suffolk University Law School, Beacon Hill, 41 Temple Street, Boston, MA 02114, Reporter EX OFFICIO BION M.
    [Show full text]
  • Which Legal Entity Is Right for Your Business
    LIMITED PARTNERSHIP CORPORATION Administrative The corporate form of doing business does have some disadvantages. Sine the corpo- A limited partnership is composed of general partners and limited partners. The defin- A corporation is a legal entity that is separate from its owners, the shareholders. It ration is a separate entity, it must file tax returns and pay taxes on its income. A WHICH LEGAL ENTITY ing characteristic of a limited partnership is that limited partners can invest capital is formed by filing certain documents with the Secretary of State and taking other corporation must maintain certain records in order to ensure that its corporate sta- in a business of the limited partnership and take a share in the profits without actions required by the Code. A corporation may have perpetual existence, meaning tus is maintained. This means additional accounting and legal costs associated with IS RIGHT FOR becoming personally liable for partnership debts and obligations. that it continues to exist regardless of the status of the individual shareholders. using the corporate form of doing business. YOUR BUSINESS: Control Control Unlike limited partnerships in many other states, in Georgia limited partners may par- A corporation is composed of three different "players": the shareholders, directors and LIMITED LIABILITY COMPANY ticipate in controlling the business without becoming personally liable for the limit- officers. It is critical to understand that these players have different responsibilities, ed partnership's obligations. Thus, Georgia is a particularly attractive state for the obligations and authorities. The shareholders own the corporation and elect the direc- The Limited Liability Company (LLC) is a business entity organized under state law formation of limited partnerships in which limited partners wish to have an active tors.
    [Show full text]
  • Partners Without Partners: the Legal Status of Single Person Partnerships
    Fordham Journal of Corporate & Financial Law Volume 17 Issue 2 Article 3 2012 Partners Without Partners: The Legal Status Of Single Person Partnerships Robert W. Hillman Donald J. Weidner Follow this and additional works at: https://ir.lawnet.fordham.edu/jcfl Part of the Business Organizations Law Commons Recommended Citation Robert W. Hillman and Donald J. Weidner, Partners Without Partners: The Legal Status Of Single Person Partnerships, 17 Fordham J. Corp. & Fin. L. 449 (2012). Available at: https://ir.lawnet.fordham.edu/jcfl/vol17/iss2/3 This Article is brought to you for free and open access by FLASH: The Fordham Law Archive of Scholarship and History. It has been accepted for inclusion in Fordham Journal of Corporate & Financial Law by an authorized editor of FLASH: The Fordham Law Archive of Scholarship and History. For more information, please contact [email protected]. Partners Without Partners: The Legal Status Of Single Person Partnerships Cover Page Footnote † © 2011 by Robert W. Hillman and Donald J. Weidner * Fair Business Practices Distinguished Professor of Law, University of California, Davis. ** Dean and Alumni Centennial Professor of Law, Florida State University College of Law. Dean Weidner was the Reporter for the Uniform Partnership Act (1994). Dean Weidner would like to thank his colleagues Steve Johnson and Manuel Utset for their comments. This article is available in Fordham Journal of Corporate & Financial Law: https://ir.lawnet.fordham.edu/jcfl/vol17/ iss2/3 VOLUME XVII 2012 NUMBER 2 FORDHAM JOURNAL OF CORPORATE & FINANCIAL LAW PARTNERS WITHOUT PARTNERS: THE LEGAL STATUS OF SINGLE PERSON PARTNERSHIPS Robert W. Hillman Donald J.
    [Show full text]
  • Structuring a Business As a Limited Liability Partnership (Llp)
    STRUCTURING A BUSINESS AS A LIMITED LIABILITY PARTNERSHIP (LLP) CORPORATE LAW INTRODUCTION Key features of an LLP, which are explored in more detail later, Partnerships have been used for many years as flexible are as follows: business vehicles for enterprises, especially where they involve a number of highly skilled entrepreneurial individuals, as they An LLP must be incorporated by being registered with the allow individuals to be brought into, leave or change their Registrar of Companies. The formalities for establishing an LLP interests in the partnership without significant tax issues (in are relatively straightforward. contrast to the position where directors or employees need to Unlike a company, an LLP does not have shares or acquire or dispose of shares in a company). shareholders, nor does it have directors – it simply has members. Generally, partnership profits are also taxed at a lower effective rate than equivalent amounts received as employment bonuses Unlike a company, an LLP does not have articles of or dividends from a company, because there is only one level association which must be publicly filed with the Registrar of taxation of profits and no employer’s national insurance of Companies. Members will often enter into a members’ contributions (NICs) on profit shares. agreement (setting out the rights and obligations of the members of the LLP) but that is a purely private document In the past, the price for the flexibility and tax efficiency of which does not need to be filed on any public register. partnerships has been unlimited liability for the individuals LLPs afford broadly similar protection from liability as is involved.
    [Show full text]
  • 2020 Instructions for Form 1065
    Userid: CPM Schema: instrx Leadpct: 100% Pt. size: 8.5 Draft Ok to Print AH XSL/XML Fileid: … ions/I1065/2020/A/XML/Cycle10/source (Init. & Date) _______ Page 1 of 61 14:39 - 5-Feb-2021 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Department of the Treasury 2020 Internal Revenue Service Instructions for Form 1065 U.S. Return of Partnership Income Section references are to the Internal Revenue Code Contents Page New employee retention credit. The unless otherwise noted. Specific Instructions Coronavirus Aid, Relief, and Economic Contents Page (Schedules K and K-1, Security Act (CARES Act) allows a new The Taxpayer Advocate Service Part III, Except as Noted) ... 33 employee retention credit for qualified (TAS) Is Here To Help You .....2 Flowchart To Help wages. Any qualified wages for which an How To Get Forms and Determine if Items Are eligible employer claims against payroll Publications ..............2 Qualified Business taxes for the new employee retention credit Income ............... 51 (ERC) may not be taken into account for General Instructions ............2 Analysis of Net Income purposes of determining certain other Purpose of Form ...........2 (Loss) ............... 55 credits. Definitions ...............2 Schedule L. Balance Sheets Temporary allowance of 100% business Who Must File .............3 per Books ............. 55 meals. A partnership is allowed a 100% Termination of the Schedule M-1. Partnership .............4 deduction for certain business meals paid or Reconciliation of Income incurred in 2021 and 2022. See Travel, (Loss) per Books With Electronic Filing ............4 meals, and entertainment. When To File ..............4 Income (Loss) per Where To File .............5 Return ..............
    [Show full text]
  • Form 701—General Information (Registration of a Limited Liability Partnership)
    Form 701—General Information (Registration of a Limited Liability Partnership) The attached form is designed to meet minimal statutory filing requirements pursuant to the relevant code provisions. This form and the information provided are not substitutes for the advice and services of an attorney and tax specialist. Commentary In accordance with title 4, chapter 152, subchapter J of the Texas Business Organizations Code (BOC), a general or limited partnership may register with the secretary of state as a "limited liability partnership." The application for registration as a limited liability partnership does not create a partnership, either general or limited. The creation of a limited partnership requires the filing of a certificate of formation (Form 207) with the secretary of state. A general partner's liability in a limited liability partnership differs from that in an ordinary partnership. In general, a general partner in a limited liability partnership is not individually liable for any obligation of the partnership incurred while the partnership is a limited liability partnership. Effective January 1, 2016, Senate Bill 859 amends subchapter J of chapter 152 of the BOC. The amendments make the registration of a limited liability partnership effective until it is voluntarily withdrawn or terminated by the secretary of state and impose an annual reporting requirement on Texas LLPs. Annual Report: BOC section 152.806, effective January 1, 2016, requires a Texas partnership that elects to register as a limited liability partnership to file an annual report with the secretary of state. The report is due no later than June 1 of each year following the calendar year in which the application for registration takes effect.
    [Show full text]