8990 Limitation on Business Interest Expense IRC 163(j)

8990

Limitation on Business Interest Expense
Under Section 163(j)

Form
(Rev. May 2020)
Department of the Treasury
Internal Revenue Service

OMB No. 1545-0123

▶ Attach

to your tax return.
▶ Go to www.irs.gov/Form8990 for instructions and the latest information.

Identification number

Taxpayer name(s) shown on tax return

If Form 8990 relates to an information return for a foreign entity (for example, Form 5471), enter:
Name of foreign entity ▶
Employer identification number, if any ▶
Reference ID number ▶

Part I

Computation of Allowable Business Interest Expense

Part I is completed by all taxpayers subject to section 163(j). Schedule A and Schedule B need to be completed before Part I when the
taxpayer is a partner or shareholder of a pass-through entity subject to section 163(j).

Section I—Business Interest Expense
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Current year business interest expense (not including floor plan financing
interest expense), before the section 163(j) limitation
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Disallowed business interest expense carryforwards from prior years. (Does
not apply to a partnership) . . . . . . . . . . . . . . . . .
Partner’s excess business interest expense treated as paid or accrued in
current year (Schedule A, line 44, column (h)) . . . . . . . . . . .
Floor plan financing interest expense. See instructions . . . . . . . .
Total business interest expense. Add lines 1 through 4 . . . . . . . .

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Section II—Adjusted Taxable Income
Taxable Income
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Taxable income. See instructions

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Additions (adjustments to be made if amounts are taken into account on line 6)
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Any item of loss or deduction that is not properly allocable to a trade or
business of the taxpayer. See instructions . . . . . . . . . . . .
Any business interest expense not from a pass-through entity. See instructions
Amount of any net operating loss deduction under section 172 . . . . .
Amount of any qualified business income deduction allowed under section
199A . . . . . . . . . . . . . . . . . . . . . . . .
Deduction allowable for depreciation, amortization, or depletion attributable to
a trade or business. See instructions . . . . . . . . . . . . . .
Amount of any loss or deduction items from a pass-through entity. See
instructions . . . . . . . . . . . . . . . . . . . . . .
Other additions. See instructions . . . . . . . . . . . . . . .
Total current year partner’s excess taxable income (Schedule A, line 44,
column (f)) . . . . . . . . . . . . . . . . . . . . . .
Total current year S corporation shareholder’s excess taxable income
(Schedule B, line 46, column (c)) . . . . . . . . . . . . . . .
Total. Add lines 7 through 15 . . . . . . . . . . . . . . . . .

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Reductions (adjustments to be made if amounts are taken into account on line 6)
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Any item of income or gain that is not properly allocable to a trade or business
of the taxpayer. See instructions . . . . . . . . . . . . . . .
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Any business interest income not from a pass-through entity. See instructions
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Amount of any income or gain items from a pass-through entity. See
instructions . . . . . . . . . . . . . . . . . . . . . .
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Other reductions. See instructions
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Total. Combine lines 17 through 20 . . . . . . . . . . . . . . . .
Adjusted taxable income. Combine lines 6, 16, and 21. (If zero or less, enter -0-.)

For Paperwork Reduction Act Notice, see the instructions.

Cat. No. 37814C

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Form 8990 (Rev. 5-2020)

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Form 8990 (Rev. 5-2020)

Section III—Business Interest Income
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25

Current year business interest income. See instructions .
Excess business interest income from pass-through entities
A, line 44, column (g), and Schedule B, line 46, column (d)) .
Total. Add lines 23 and 24 . . . . . . . . . . .

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Schedule
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Disallowed business interest expense. Subtract line 29 from line 5. (If zero or less, enter -0-.)

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Section IV—163(j) Limitation Calculations
Limitation on Business Interest Expense
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29

Multiply adjusted taxable income (line 22) by the applicable percentage. See
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instructions . . . . . . . . . . . . . . . . . . . . . .
Business interest income (line 25) . . . . . . . . . . . . . . .
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Floor plan financing interest expense (line 4) . . . . . . . . . . .
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Total. Add lines 26, 27, and 28 . . . . . . . . . . . . . . . . . . .
Allowable Business Interest Expense

30

Total current year business interest expense deduction. See instructions .

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Carryforward
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Part II

Partnership Pass-Through Items

Part II is only completed by a partnership that is subject to section 163(j). The partnership items below are allocated to the partners
and are not carried forward by the partnership. See the instructions for more information.
Excess Business Interest Expense
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Excess business interest expense. Enter amount from line 31 .

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Excess Taxable Income (If you entered an amount on line 32, skip lines 33 through 37.)
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Subtract the sum of lines 4 and 25 from line 5. (If zero or less, enter -0-.) . . . .
Subtract line 33 from line 26. (If zero or less, enter -0-.) . . . . . . . . . .
Divide line 34 by line 26. Enter the result as a decimal. (If line 26 is zero, enter -0-.)
Excess taxable income. Multiply line 35 by line 22 . . . . . . . . . . .

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Excess Business Interest Income
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Excess business interest income. Subtract the sum of lines 1, 2, and 3 from line 25. (If zero or less,
enter -0-.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part III

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S Corporation Pass-Through Items

Part III is only completed by S corporations that are subject to section 163(j). The S corporation items below are allocated to the shareholders.
See the instructions for more information.

Excess Taxable Income
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Subtract the sum of lines 4 and 25 from line 5. (If zero or less, enter -0-.) . . . .
Subtract line 38 from line 26. (If zero or less, enter -0-.) . . . . . . . . . .
Divide line 39 by line 26. Enter the result as a decimal. (If line 26 is zero, enter -0-.) .
Excess taxable income. Multiply line 40 by line 22 . . . . . . . . . . .

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Excess Business Interest Income
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Excess business interest income. Subtract the sum of lines 1, 2, and 3 from line 25. (If zero or less,
enter -0-.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Form 8990 (Rev. 5-2020)

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Form 8990 (Rev. 5-2020)

SCHEDULE A

Summary of Partner’s Section 163(j) Excess Items

Any taxpayer that owns an interest in a partnership subject to section 163(j) should complete Schedule A before completing Part I.
Excess Business Interest Expense
(a) Name of partnership

(b) EIN

(c) Current
year

(d) Prior
year carryforward

(e) Total
((c) plus (d))

(f) Current year
excess
taxable income

(g) Current year
excess business
interest income

(i) Current year
(h) Excess business
interest expense treated excess business interest
expense
carryforward
as paid or accrued
((e) minus (h))
(see instructions)

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Total

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SCHEDULE B

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Summary of S Corporation Shareholder’s Excess Taxable Income and Excess Business Interest Income

Any taxpayer that is required to complete Part I and is a shareholder in an S corporation that has excess taxable income or excess business interest income should complete Schedule B
before completing Part I.
(a) Name of S corporation

(b) EIN

(c) Current year excess
taxable income

(d) Current year excess
business interest income

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46

Total

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Form 8990 (Rev. 5-2020)