The Georgia Department of Revenue has amended its personal income tax regulation concerning withholding on nonresident members of pass-through entities to conform with statutory changes. The amendments require any partnership, S corporation, or limited liability company (LLC) that owns property or does business in Georgia to withhold a nonresident member’s share of taxable income sourced to Georgia, whether distributed or not. The withholding requirement does not apply to an S corporation that is treated as a C corporation for Georgia purposes. Income includes the nonresident member’s share of Georgia separately stated income, guaranteed payments, loss, deduction or expense of the entity and the nonresident member’s share of the Georgia nonseparately stated income, loss, deduction or expense of the entity.
Payment should be remitted with required Form G-7-NRW. Form NRW-Exemption should be completed by a nonresident member to certify certain exemptions from the withholding requirements. Reg. §560-7-8-.34, Georgia Department of Revenue, effective August 13, 2012