325-P: Agricultural Pollution Control Equipment Credit – Distribution to Partners (2024)
Arizona · Arizona DOR · Used for tax years 2024
Arizona Form 325-P reports an individual partner’s share of a partnership’s Agricultural Pollution Control Equipment Credit. It lists the partnership’s credit amount, the partner’s ownership percentage, and the resulting portion of the credit.
Who files this form
Partnerships distributing this credit must complete a separate Form 325-P for each individual partner.
Individual partners use Form 325-P to complete their own Form 325 and include the completed Form 325-P with their tax return.
If a partnership ownership share is held by a grantor trust that is disregarded for federal income tax purposes, the share is treated as owned by the grantor. The grantor may claim their share of the credit.
Corporate taxpayers are not eligible to claim this credit.
What you'll need
To complete Form 325-P, have:
- The partnership’s name and Employer Identification Number (EIN).
- The individual partner’s name, Taxpayer Identification Number (TIN), and ownership percentage.
- The partnership’s Form 325, Part 3, line 18, showing the partnership credit amount.
Individual partners need the completed Form 325-P to complete their own Form 325.
How to file
Partnerships
- Complete a separate Form 325-P for each individual partner.
- Enter the partnership and partner information in Part 1.
- On line 3, enter the partnership credit amount from Form 325, Part 3, line 18.
- Multiply line 3 by the partner’s ownership percentage on line 2(c). Enter the partner’s portion of the credit on line 4.
- Give each individual partner a copy, keep a copy for your records, and include a copy of each completed Form 325-P with the partnership return.
Individual partners
Include the amount from Form 325-P, line 4, on your own Form 325, Part 2, line 15. Include the completed Form 325-P with your return and keep a copy for your records.
Common mistakes
- Claiming the credit in the wrong year. If you file on a calendar-year basis but the partnership files on a fiscal-year basis, claim the credit for the year in which the partnership’s fiscal year ends.
- Leaving out required copies. Partnerships must include a copy of each completed Form 325-P with their return and give each individual partner a copy. Individual partners must include their completed form with their own return. Both must keep copies for their records.
- Using the wrong credit amount on the partner’s Form 325. The partner’s portion is on Form 325-P, line 4, and belongs on the partner’s Form 325, Part 2, line 15.
- Claiming the credit as a corporate taxpayer. Corporate taxpayers are not eligible.
Questions people ask
How is my share of the credit calculated?
The partnership multiplies its credit amount from Form 325, Part 3, line 18, by your ownership percentage. Your share appears on Form 325-P, line 4.
Where do I report my share of the credit?
Include the amount from Form 325-P, line 4, on your own Form 325, Part 2, line 15.
What if the partnership’s fiscal year differs from my calendar tax year?
If you file on a calendar-year basis, claim the credit on your return for the year in which the partnership’s fiscal year ends.
Can a grantor claim the credit for a partnership share held by a trust?
Yes, if the share is owned by a grantor trust that is disregarded for federal income tax purposes. The share is treated as owned by the grantor, who may claim their portion of the credit.
Can a corporate taxpayer claim this credit?
No. Corporate taxpayers are not eligible to claim this credit.