CCH iFirm Tax T2 2019 v.2.3 (2019.50.v27)

CO-17.B, Adjustment of Income from one or more Partnerships

CO-17.B.1, Amount to Be Included in the Income of a Corporation That Is a Member of a Single-Tier Partnership

CO-17.B.2, Amount to Be Included in the Income of a Corporation That Is a Member of a Multi-Tier Partnership

These forms are used to calculate the income or loss for tax purposes from all partnerships of which the corporation is a member. The income (or loss) thus calculated takes into account the inclusion that arises from the tax measure to limit the tax deferral on income earned through a partnership. These forms also allow you to calculate the reserve in respect of qualifying transitional income (QTI).

Form CO-17.B.1 (Jump Code: Q17B) is used to calculate the amounts that must be included in the calculation of the corporation’s income, or that must be deducted from this income, with respect to all partnerships of which the corporation is a member. As a result, the form will take into account the partnership’s income or loss for the year, as well as the amounts calculated in Forms CO-17.B.1 (Jump Code: Q17B1) and CO-17.B.2 (Jump Code: Q17B1) with regards to the income inclusion and reserve in respect of QTI for partnerships whose fiscal period year end does not coincide with the corporation’s taxation year end.

If the partnership elects to align the end of its fiscal period with the filing corporation’s taxation year end, the latter must add this amount to the corporation's share in the partnership's income or losses (column B in Section 4 of Form CO-17.B). In addition, if the end of the fiscal period of the partnership does not coincide with the filing corporation’s taxation year end, regardless of whether or not there was an the alignment, a calculation must be made to determine the income in this stub period. (The stub period corresponds to the period included between the partnership’s fiscal period start date that begins in the corporation’s taxation year and the filing corporation’s taxation year end.)

As for the income shortfall adjustment amount and the additional amount calculated in Part 7 of Form CO-17.B, it is included in the income or loss for tax purposes calculated in Part 4 of this form. Because the amounts in Part 6 must take this amount into account, it will be added to the income or loss for tax purposes (column A) on line 50.

As for Form CO-17.B.1, it is to be completed by a corporation that is the member of a single-tier partnership, while Form CO-17.B.2 is to be completed by a corporation that is the member of a multi‑tier partnership. A single-tier partnership is a partnership that is not a member of another partnership, whereas a multi-tier partnership is a partnership that is a member of another partnership. Data entered in federal Schedule 71, Income Inclusion for Corporations that are Members of Single-Tier Partnerships (Jump Code: 71) and 72, Income Inclusion for Corporations that are Members of Multi-Tier Partnerships (Jump Code: 72) will be automatically transferred to Forms CO-17.B.1 and CO-17.B.2 respectively.

For more information on the above mentioned tax measure or to consult the definitions of the various related terms, please refer to sections 217.18 to 217.37 of the Québec Taxation Act as well as the related topics for federal Schedules 71, 72 and 73.