Page 151 - Large Business IRS Training Guides

Allocation Rules

Tax Items Other Than Interest Income and Expense (cont’d)

• Expenses, losses, and deductions, other than

interest, definitely related to a trade or business,

within the meaning of Treas. Reg. § 1.861-8(b),

would be allocable to that trade or business.

• Deductions related to one or more excepted or

non-excepted trades or businesses are

apportioned based on relative adjusted tax basis

of the assets used in those trades or businesses.

• All other deductions are ratably apportioned

based on gross income.

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