Instructions For Form Ftb 3801-Cr - Passive Activity Credit Limitations - 2016 Page 4
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4Part V
Step 3 — Reduce low-income housing credits
Step 8 — Low-income housing credits allowed
for property placed in service before 1990
under the $75,000 special allowance for
Passive Activity Credits Allowed
from each PTP, and any low-income housing
property placed in service after 1989 from a
Line 37 – If you have only one type of credit,
credits from each PTP in which you acquired
PTP in which you also acquired your interest
the amount on line 37 is the credit allowed for
your interest before 1990 (regardless of the
after 1989, are the smaller of the total credits
the year. Enter this amount on the appropriate
date placed in service) to the extent of the tax
from Step 6 or the amount figured in Step 7.
credit form. Your unallowed credit would be
attributable to net passive income from that
If Step 7 is smaller than Step 6, allocate the
line 5 minus line 37.
PTP, which was figured in Step 1.
amount in Step 7 pro rata to the credits from
If you have more than one type of credit,
each PTP in Step 6.
Step 4 — Before beginning this step, you
or credits from more than one activity, use
must complete form FTB 3801-CR if you have
Step 9 — Add the credits from Steps 2, 5,
Worksheet 5 through Worksheet 9 in the
any passive credits that are not from PTPs.
and 8. These are the credits allowed from
instructions for federal Form 8582-CR to
Subtract the sum of form FTB 3801-CR,
passive activities of PTPs.
allocate the allowed and unallowed credits.
line 16, line 30, and line 36 (if any) from
Step 10 — Figure the allowed and unallowed
Keep a record of each unallowed amount and
form FTB 3801-CR, line 27 to figure the tax
credits from each PTP. Report the allowed
the activity to which it belongs so you can
attributable to the $75,000 special allowance
credits on the appropriate credit form. Keep
claim the credit if it becomes allowable in a
available for the credits in Step 3.
a record of the unallowed credits for use in a
future year.
If your only passive credits are from PTPs,
future year.
Credits from Publicly Traded Partnerships
complete form FTB 3801-CR, line 21 through
Part VI
(PTPs)
line 27 as a worksheet. The amount on line 27
A credit from a passive activity held through
is the tax attributable to the $75,000 special
Election to Increase Basis of Credit Property
a PTP is allowed to the extent of the tax
allowance available for the credits in Step 3.
Complete Part VI if you disposed of your
attributable to net passive income from that
Step 5 — Low-income housing credits for
entire interest in a passive activity or former
partnership. In addition, low-income housing
property placed in service before 1990 by each
passive activity in a fully taxable transaction
credits from rental real estate activities held
PTP, and any low-income housing credits from
and you elect to increase the basis of the credit
through PTPs are allowed to the extent of the
a PTP in which you acquired your interest
property used in that activity by the unallowed
remaining $75,000 special allowance. Before
before 1990 (regardless of the date placed in
credit that reduced the property’s basis.
the credits may be applied to the $75,000
service) allowed under the $75,000 special
(or less, if applicable) special allowance, the
allowance are the smaller of the total credits
special allowance must be reduced by the
from Step 3 or the amount figured in Step 4.
amount used under the passive loss rules and
If Step 4 is smaller than Step 3, allocate the
the amount used for credits which were not
amount in Step 4 pro rata to the credits from
from a PTP.
each PTP in Step 3.
Do not enter credits from PTPs on the
Complete Step 6 through Step 8 only if you
worksheets or on form FTB 3801-CR. Instead,
have low-income housing credits for property
use the following steps to compute the allowed
placed in service after 1989 from a PTP in
and unallowed credits from passive activities
which you also acquired your interest after
held through PTPs.
1989.
Computation of Passive Activity Credits
Step 6 — Reduce low-income housing credits
Allowed for PTPs
for property placed in service after 1989 from
Complete Step 1 and Step 2 only if you have
a PTP in which you also acquired your interest
net passive income from a PTP with passive
after 1989 to the extent of the tax attributable
activity credits.
to net passive income from that PTP, which
In the following instructions, the term “credits”
was figured in Step 1.
includes current year credits and prior year
Step 7 — Before beginning this step, you
unallowed credits.
must complete form FTB 3801-CR if you
Step 1 — Figure the tax attributable to net
have any passive credits that are not from
passive income from each PTP with passive
PTPs. Subtract the sum of the credits
activity credits by following the steps shown
allowed in Step 5 above and line 36 of form
in the worksheet in the line 6 instructions.
FTB 3801-CR from the amount on line 35 of
Complete a separate tax computation for each
form FTB 3801-CR to figure the tax attributable
PTP with net passive income.
to the $75,000 special allowance available for
the credits in Step 6.
Step 2 — Passive activity credits from
each PTP are allowed to the extent of the
If your only passive credits are from PTPs,
tax attributable to net passive income from
complete the steps shown in the worksheet in
that same PTP. Credits in excess of the tax
the line 35 instructions. Subtract the credits
attributable to net passive income may be
allowed in Step 5 above from the tax figured
allowed under one or more steps below.
on line J of that worksheet. The result is the tax
attributable to the $75,000 special allowance
Complete Step 3 through Step 5 only if you
available for the credits in Step 6.
have low-income housing credits for property
placed in service before 1990 from a PTP, or
low-income housing credits from a PTP in
which you acquired your interest before 1990
(regardless of the date placed in service).
Page 4 FTB 3801-CR Instructions 2016
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