REC: Reconciliation (2024)
Minnesota · Minnesota DOR · Used for tax years 2024
Minnesota’s 2024 REC, Reconciliation, is a schedule that reconciles income reported on federal consolidated returns to income reported on M4I, line 1a. It lists federal taxable income before net operating loss and special deductions, adjusts for companies included in or excluded
Who files this form
The 2024 Minnesota Schedule REC is used to reconcile income reported on your federal consolidated return with income reported on M4I, line 1a.
What you'll need
Have these records and details ready:
- Federal consolidated return(s), including the parent corporations’ names and federal Form 1120, line 28 amounts.
- Any other federal returns for companies included in the unitary business.
- Names, FEINs, and Minnesota Tax IDs for the corporations listed.
- M4I, line 1a, for the amount entered on REC, line 6.
- An explanation for each company included in the federal consolidated returns but excluded from the unitary business, along with its portion of Form 1120, line 28.
- An explanation of each component of any difference reported on REC, line 7.
Common mistakes
- Not rounding amounts. The form requires amounts to be rounded to the nearest whole dollar.
- Leaving out exclusion explanations. Attach an explanation for companies listed in Part 3 that are excluded from the unitary business.
- Leaving a difference unexplained. For line 7, explain each component amount of the difference between lines 5 and 6.
Questions people ask
Which federal income amount goes in Part 1?
Use federal Form 1120, line 28: total federal taxable income before the net operating loss deduction and special deductions. List the parent corporations from your federal consolidated return(s).
What belongs in Part 2?
List companies included in the unitary business from federal returns not listed in Part 1. Total their federal taxable income on line 2.
What if a company is on the federal consolidated return but not in the unitary business?
List it in Part 3 with its portion of Form 1120, line 28. Attach an explanation for the exclusion, and total the Part 3 income on line 4.
How do I calculate the reconciliation?
Add lines 1 and 2 to get line 3. Subtract line 4 from line 3 to get line 5. Enter the amount from M4I, line 1a, on line 6. Report the difference between lines 5 and 6 on line 7 and explain each component amount.