Investment management is conducted by general partner B from a Maryland office. The partnership has three nonresident partners - C, D and E. Each of the nonresident partner's share of the trading results of the partnership is proportionate to their investment capital. The partnership is required to file a Maryland income tax return, but it is exempt from the partnership tax. C, D and E are exempt from filing nonresident income tax returns if they have no other income from Maryland sources. B. Partnership V owns a shopping center in Maryland as well as a substantial investment portfolio consisting of stocks, bonds and other intangible investments.
Management is conducted by general partner X from a New York location.
Y and Z are limited partners residing in New York. The partnership is subject to the partnership tax. Treatment of Tax. The law provides that the tax imposed on partnerships and S corporations shall be treated as a tax imposed on the individual nonresident partners and shareholders and is paid on their behalf by the partnership or S corporation. The tax paid by the partnership or S corporation may, therefore, be treated as a tax paid by the nonresident individual in computing estimated taxes and may be taken as a credit on the individual's nonresident return.