59-10-117. State taxable income derived from Utah sources.
(1) For purposes of Section 59-10-116, state taxable income includes those items
includable in state taxable income attributable to or resulting from:
(a) the ownership in this state of any interest in real or tangible personal property,
including real property or property rights from which gross income from mining as defined by
Section 613(c), Internal Revenue Code, is derived; or
(b) the carrying on of a business, trade, profession, or occupation in this state.
(2) For the purposes of Subsection (1):
(a) income from intangible personal property, including annuities, dividends, interest,
and gains from the disposition of intangible personal property shall constitute income derived
from Utah sources only to the extent that the income is from property employed in a trade,
business, profession, or occupation carried on in this state;
(b) a deduction with respect to a capital loss, net long-term capital gain, or net operating
loss shall be based solely on income, gain, loss, and deduction connected with Utah sources,
under rules prescribed by the commission in accordance with Title 63G, Chapter 3, Utah
Administrative Rulemaking Act, but otherwise shall be determined in the same manner as the
corresponding federal deductions;
(c) a salary, wage, commission, or compensation for personal services rendered outside
this state may not be considered to be derived from Utah sources;
(d) a nonresident shareholder's distributive share of ordinary income, gain, loss, and
deduction derived from or connected with Utah sources shall be determined under Section
59-10-118;
(e) a nonresident, other than a dealer holding property primarily for sale to customers in
the ordinary course of the dealer's trade or business, may not be considered to carry on a trade,
business, profession, or occupation in this state solely by reason of the purchase or sale of
property for the nonresident's own account;
(f) if a trade, business, profession, or occupation is carried on partly within and partly
without this state, an item of income, gain, loss, or a deduction derived from or connected with
Utah sources shall be determined in accordance with Section 59-10-118;
(g) a nonresident partner's distributive share of partnership income, gain, loss, deduction,
or credit derived from or connected with Utah sources shall be determined under Part 14,
Pass-Through Entities and Pass-Through Entity Taxpayers Act;
(h) the share of a nonresident estate or trust or a nonresident beneficiary of any estate or
trust in income, gain, loss, or deduction derived from or connected with Utah sources shall be
determined under Section 59-10-207; and
(i) any dividend, interest, or distributive share of income, gain, or loss from a real estate
investment trust, as defined in Section 59-7-101, distributed or allocated to a nonresident investor
in the trust, including any shareholder, beneficiary, or owner of a beneficial interest in the trust,
shall be income from intangible personal property under Subsection (2)(a), and shall constitute
income derived from Utah sources only to the extent the nonresident investor is employing its
beneficial interest in the trust in a trade, business, profession, or occupation carried on by the
investor in this state.
Amended by Chapter 312, 2009 General Session
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Last revised: Thursday, May 28, 2009