If a financial institution as defined in section 581 of the Internal Revenue Code elects to file as an S corporation for federal income tax purposes and therefore have its income taxed directly to the shareholders, those shareholders (individuals, C corporations, fiduciaries) qualify for a Franchise Tax Credit. The credit cannot exceed the shareholder’s pro rata share of the Iowa franchise tax paid by the financial institution.
To complete this form, you will need information from the 1120F and 1120S filed by the financial institution. This information is included with your IA Schedule K-1. You will also need your IA 1040, or IA 1120, or IA 1041.
Please see instuctions for Iowa form 147 for more information.