The 2010 1120, 1120-L, 1120-PC, and 1120-S Schedule M-3 each have two new lines in Part III, one for R&D costs and one for Section 118 exclusions. The 2010 1065 Schedule M-3 has one new line in Part III for R&D costs. In addition, the instructions for all Schedule M-3 forms are clarified as to the attachment required for the "other with difference" lines (one in Part II and one in Part III) and as to the "separately stated and adequately disclosed" requirement for those lines.
2010 Schedule M-3 New or Revised Line Instructions links to a 3-page PDF extract from the draft 1120-L instructions for the two new Schedule M-3 lines (R&D: Section 118) and the revisions to the instructions for the Part III "other with difference" line. The changes to the instructions for the Part II "other with difference" line are similar to the changes for the Part III line and are not separately posted. The additions and revisions shown for the draft 2010 1120-L Schedule M-3 instructions apply across all Schedule M-3 forms except that the Section 118 line does not apply to the 1065.