Form 3541 - California Motion Picture And Television Production Credit - 2012 Page 3

ADVERTISEMENT

Instructions for Form FTB 3541
California Motion Picture and Television Production Credit
Important Information
• Assigned to or from an affiliated corporation under R&TC
Section 23865(c)(1). For more information, see General
California Motion Picture and Television Production Credit. For
Information C, Credit Assignment.
taxable years beginning on or after January 1, 2011, Revenue & Taxation
• Applied or will be applied against BOE qualified sales and use taxes.
Code (R&TC) Section 17053.85 and Section 23685 allow a qualified
For more information, go to boe.ca.gov and search for ca film.
taxpayer a California motion picture and television production credit
Note: Each entity that received or assigned a motion picture and
against the net tax (individuals) or tax (corporations) and/or qualified
television production credit from or to another entity within a combined
sales and use tax. The credit, which is allocated and certified by the
reporting group must complete a separate form FTB 3541.
California Film Commission (CFC), is 20% of expenditures attributable
S corporations, estates and trusts, and partnerships, or LLCs taxed
to a qualified motion picture or 25% of production expenditures
as partnerships should complete form FTB 3541 to figure the amount
attributable to an independent film or a television series that relocates to
California.
of credit to pass-through to shareholders, beneficiaries, partners, or
members. The credit is not allowed at the pass-through entity level.
Write “CFC Credit”– Taxpayers attaching form FTB 3541, California
Attach this form to Form 100S, California S Corporation Franchise or
Motion Picture and Television Production Credit, to the tax return should
Income Tax Return; Form 541, California Fiduciary Income Tax Return;
write “CFC Credit” in red ink at the top margin of their tax return.
Form 565, Partnership Return of Income; or Form 568, Limited Liability
Use of Credit – The credit can be used by the qualified taxpayer to:
Company Return of Income. Show the pass-through credit for each
• Offset franchise or income tax liability. Use credit code number 223
shareholder, beneficiary, partner, or member on Schedules K-1 (100S,
when claiming this credit.
541, 565, or 568), Share of Income, Deductions, Credits, etc.
• Sell to an unrelated party (independent films only).
Corporate taxpayers attach this form to Form 100, California Corporation
• Assign to an affiliated corporation.
Franchise or Income Tax Return, or Form 100W, California Corporation
• Apply against qualified sales and use taxes.
Franchise or Income Tax Return - Water’s Edge Filers.
This credit is not refundable.
Individual taxpayers attach this form to Form 540, California Resident
Sales and Use Taxes – A qualified taxpayer who has been issued a
Income Tax Return, or Form 540NR, California Nonresident or Part-Year
certified Form M, Tax Credit Certificate, from the CFC may make an
Resident Income Tax Return.
irrevocable election with the Board of Equalization (BOE) to apply the
B Definitions
credit against qualified sales and use taxes. For more information, go
to boe.ca.gov and search for ca film.
Credit certificate. Credit certificate means the certificate issued by the
Credit Assignment – A qualified taxpayer that is a corporation or is taxed
CFC for the allocation of the credit to a qualified taxpayer.
as a corporation and whose credit exceeds the tax may elect to assign
Qualified taxpayer. Qualified taxpayer means a taxpayer who has paid or
the credit to an affiliated corporation(s). The election to assign the credit
incurred qualified expenditures and has been issued a credit certificate
is irrevocable. For more information, see General Information C, Credit
by the CFC. In the case of any pass-through entity, the determination of
Assignment.
whether a taxpayer is a qualified taxpayer is made at the entity level. The
Sale of Credit Attributable to an Independent Film – A qualified taxpayer
credit is not allowed at the pass-through entity level. The credit is passed
may sell a credit, attributable to an independent film, to an unrelated
through to the shareholders, beneficiaries, partners, or members.
party once the taxpayer receives Form M from the CFC. The credit can
Qualified motion picture. Qualified motion picture means a motion
only be sold by the qualified taxpayer that generated the credit (that is a
picture that is produced for distribution to the general public, regardless
corporation, a Limited liability company (LLC) or partnership taxed as a
of medium. For more information, refer to the R&TC Section 17053.85,
corporation, or an individual) or by a shareholder, beneficiary, partner, or
Section 23685, or go to film.ca.gov.
member who received the credit as their distributive or pro-rata share.
Independent film. Independent film means a motion picture with a
For more information, get form FTB 3551, Sale of Credit Attributable to an
minimum budget of one million dollars ($1,000,000) and a maximum
Independent Film, or go to ftb.ca.gov and search for motion picture.
budget of ten million dollars ($10,000,000) that is produced by a
Seller – A qualified taxpayer that sells an independent film credit is
company that is not publicly traded and publicly traded companies do
required to report the gain on the sale of the credit in the amount of
not own, directly or indirectly, more than 25 percent of the producing
the sale price.
company.
Buyer – If the credit was purchased for less than the credit amount
Television series. Television series means a television series that
stated on Form M, the buyer is required to report income in the
relocated to California, without regard to episode length or initial
amount of the difference between the credit amount claimed on its
media exhibition, that filmed all of its prior season or seasons outside
return and the purchase price.
of California and for which the taxpayer certifies that this credit is the
primary reason for relocating to California.
General Information
Affiliated corporation. Affiliated corporation has the meaning provided
in R&TC Section 25110(b), except that “100 percent” is substituted for
A Purpose
“more than 50 percent” wherever it appears in the section and “voting
common stock” is substituted for “voting stock” wherever it appears
Use form FTB 3541 to report the credit for the production of a qualified
in the section. For more information, see General Information C, Credit
motion picture in California that was:
Assignment.
• Allocated from the CFC on Form M, Tax Credit Certificate.
• Passed through from S corporations, estates and trusts,
partnerships, or limited liability companies (LLCs) taxed as
partnerships.
• Purchased from a qualified taxpayer.
FTB 3541 Instructions 2012 Page 1

ADVERTISEMENT

00 votes

Related Articles

Related forms

Related Categories

Parent category: Financial
Go
Page of 5