New Hampshire Code of Administrative Rules
Rev - Department of Revenue Administration
Chapter Rev 900 - INTEREST AND DIVIDENDS TAX
Part Rev 902 - RESIDENCY AND TAXABILITY OF SPECIAL ENTITIES
Section Rev 902.08 - Accounting Method For Determination of Accumulated Profits

Universal Citation: NH Admin Rules Rev 902.08

Current through Register No. 12, March 21, 2024

(a) Corporate organizations, including S corporations, shall compute the amount of their accumulated profits in conformity with the provisions of the Internal Revenue Code of 1986, as amended, for the calculation of earnings and profits.

(b) Partnerships, limited liability companies, associations or trusts composed of transferable shares may elect to continuously calculate their accumulated profits in a manner:

(1) Consistent with the calculation of corporate earnings and profits under the Internal Revenue Code of 1986, as amended; or

(2) Which conforms in all respects to generally accepted accounting principles.

(c) The partnership, limited liability company, association or trust shall maintain records showing:

(1) The method selected in (b) above; and

(2) The calculation of the current year and accumulated profits.

(d) If an organization does not maintain records showing the calculation of accumulated profits and a distribution is made to the shareholders or interest holders, the department shall presume there are adequate accumulated profits to treat the distribution as a dividend.

(e) The accumulated profits of a partnership shall be reduced by the amount of compensation paid to the partners and deducted under RSA 77-A:4 if the partnership's accounting records provide evidence as to:

(1) The amount of such compensation deducted; and

(2) The partnership's filing of a business profits tax return for all years in which the partnership's profits are reduced by such deduction.

(f) The accumulated profits of a limited liability company taxed as a partnership or proprietorship shall be:

(1) Reduced by the amount of compensation paid to any member who is a natural person; and

(2) Deducted under RSA 77-A:4 if the limited liability company's accounting records provide evidence as to:
a. The amount of such compensation deducted; and

b. The limited liability company's filing of a business profits tax return for all years in which the limited liability company's profits are reduced by such a deduction.

#6321, eff 8-22-96; ss by #8137, eff 8-10-04); ss by #9658, eff 2-24-10; ss by #9843, eff 12-23-10 (see Revision Note at chapter heading for Rev 900); ss by #10211, eff 10-24-12

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