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110CSR21G

7.3.2. The West Virginia personal exemption specified in W. Va. Code §11-21-16 may not be applied by the electing PTE in determining the electing PTE’s taxable income.

7.3.3. In determining the share of pass-through entity income or loss that is attributable to West Virginia, the electing PTE adds each nonresident owner's share of pass-through entity income or loss other than dividend income (“apportionable income”), after any increasing or decreasing modifications, multiplied by the pass-through entity’s apportionment percentage; and each nonresident owner’s share of dividend income (“allocable income”) if the pass-through entity is commercially domiciled in West Virginia.

7.3.4. An electing PTE’s calculation of its pass-through entity taxable income must include all items of income, gain, loss, and deduction, to the extent they would flow through and be included in the income of owners that are taxable under W. Va. Code §11-21-1 et seq.

7.3.5. The electing PTE can exclude income from the calculation of pass-through entity taxable income to the extent that the electing PTE can establish that the amount is properly allocable to an owner who is not subject to tax on such amount under W. Va. Code §11-21-1 et seq. Two examples are: (1) income that is not U.S. sourced and is allocable to nonresident alien partners and, therefore, not included in federal adjusted gross income under the Internal Revenue Code; and (2) retirement income of former partners that is exempt from nonresident state taxation under 4 U.S.C § 114.

7.3.6. In determining West Virginia taxable income, an electing PTE must add to its West Virginia taxable income any state and local taxes to the extent that the electing PTE deducted such taxes in determining the electing PTE’s federal taxable income.

110-21G-8. Computing Electing Pass-Through Entity Tax.

8.1. An electing PTE calculates its West Virginia income tax by multiplying its West Virginia taxable income by a tax rate equal to the top marginal personal income tax rate on individuals.

8.2. Economic development tax credits and other credits allowed by law to be passed through to the owners of a pass-through entity may be applied against the electing PTE tax. These credits include, but are not limited to:

Economic Opportunity Tax Credit (W.Va. Code §11-130-1 et seq.); High Technology Manufacturers Credit (W.Va. Code §11-13Q-10a);

Jobs Creation Tax Credit (W.Va. Code §11-13Q-22);

Small Business Property Tax Adjustment Tax Credit (a refundable credit) (W.Va. Code §11- 13MM-5);

Downstream Natural Gas Manufacturing investment Tax Credit (W. Va. Code §11-13GG- Letseq.);

Natural Gas Liquids Property Tax Adjustment Credit (W. Va. Code §11-13HH-1 et seq.};