FAE170: Franchise and Excise Tax Return Kit (includes return and Schedules A-H, J, K, M, N-P, R-V) (2024)
Tennessee · Tennessee DOR · Used for tax years 2024
Tennessee Form FAE170 is the 2024 Franchise and Excise Tax Return. The return and its schedules report net worth, income subject to excise tax, gross receipts, credits, and payments to calculate the total tax due or overpayment.
What you'll need
Have the following information ready for the parts of the return that apply to you:
- Business details: Legal name, mailing address, account number, FEIN, Tennessee Secretary of State control number, NAICS code, tax-year beginning and ending dates, and the date Tennessee operations began.
- Federal tax return information: Schedules J1 through J4 use figures from the federal return appropriate to your entity, including Forms 1065, 1120S, 1120, or the listed individual income tax schedules. Schedule H asks for gross receipts or sales from your federal income tax return.
- Financial records: Total assets and liabilities for net worth, plus the income, expenses, and adjustments requested by the applicable schedules.
- Payment and carryover records: Quarterly estimated payments, any extension payment, available prior-year overpayment, loss carryovers, and credit carryovers.
- Apportionment information, if applicable: Tennessee and total-everywhere property, payroll, sales, or the transportation figures requested by your schedule.
Schedule J requires an attached schedule for the pass-through entity amounts reported on Lines 11 and 25. If reporting the intangible expense deduction on Line 23, attach Form IE, Intangible Expense Disclosure.
Common mistakes
- Not rounding amounts: The return says to round to the nearest dollar.
- Completing the property-measure line without an election: Schedule A, Line 2 is only for taxpayers electing to calculate franchise tax based on the property measure. All other taxpayers must leave it blank.
- Using consolidated net worth without the required application: Complete Schedule F2 only if the Consolidated Net Worth Election Registration Application has been filed.
- Claiming too much credit: Total credit on Schedule C, Line 9 cannot exceed the tax on Line 8.
- Including a future interest deduction in current deductions: Schedule J, Line 30 specifically excludes the business interest expense carryforward on Line 28b.
- Using allocation or apportionment without qualifying: These schedules may be used only by taxpayers doing business outside Tennessee within the meaning of the cited statutes. The taxpayer must show the right to apportion.
Questions people ask
How is franchise tax calculated on the 2024 return?
Schedule A calculates franchise tax at 25 cents per $100, or major fraction of $100, on the greater of Lines 1 and 2. The minimum tax is $100. Line 2 applies only to taxpayers electing the property measure.
What is the excise tax rate?
Schedule B calculates excise tax at 6.5% of the income subject to excise tax from Schedule J, Line 38. It then adds any tax credit recapture and additional excise tax on certified distribution sales.
Is there an excise tax standard deduction?
Yes. Schedule J, Line 32 uses the lesser of Line 31 or $50,000, with zero entered if negative. Schedule M, Line 10 allows $50,000 less the amount reported on Schedule J, Line 32, but cannot exceed the nonbusiness earnings allocated directly to Tennessee on Schedule M, Line 9.
What can I do with an overpayment?
If Schedule C, Line 16 shows an overpayment, complete Part A to credit an amount to next year’s tax, Part B to request a refund, or both.