Instructions for Form FTB 3580
Application and Election to Amortize Certified Pollution Control Facility
References in these instructions are to the Internal Revenue Code (IRC) as of January 1, 2009, and to the California Revenue and Taxation Code (R&TC).
You must have completed construction, reconstruction, or erection
of the property after December 31, 1968. However, if the treatment
facility is used in connection with any plant or other property not
in operation before January 1, 1969, you must have completed the
Use form FTB 3580, Application and Election to Amortize Certified
construction, reconstruction, or erection of the treatment facility
Pollution Control Facility, to request certification of a pollution control
property after December 31, 1975.
facility placed in service in California, and to elect to amortize the
You must have acquired the property after December 31, 1968, if
basis over a period of 60 months. This election follows the provisions
the original use of the property begins with you after this date.
of the Internal Revenue Code (IRC) Section 169 and the California
Original use – means the first use to which the property is put,
Revenue and Taxation Code (R&TC) Sections 17250(b) and 24372.3,
whether or not the use corresponds to your current use of the
which are subject to the rules relating to corporate preferences of IRC
Sections 291(a)(4) and 1363(b)(4), and R&TC Sections 24449 and
23800. The amortizable basis for this purpose may be limited. See
C Amortization Period
definition of amortizable basis below.
At your election, the 60-month amortization period begins with the
The certified pollution control facility amortization deduction is in lieu
month following the date in which you completed or acquired the
of otherwise allowable depreciation.
For C corporations that elect to amortize during the first three
taxable years following the conversion of a C corporation to an
Adjusted basis – includes the cost of purchase and installation or, if
S corporation, only 80% of the adjusted basis of the certified pollution
the facility is fabricated by you, the cost of labor and materials.
control facilities may be amortized over 60 months. Accordingly,
If the useful life of the facility is more than 15 years, you must reduce
for corporations the amortizable basis of certified pollution control
the adjusted basis of the facility to an amount that is in the same ratio
facilities for which a rapid amortization election is made must be
as 15 years is to the facility’s total years of useful life.
reduced by 20% (see IRC Sections 291(a)(4) and 1363(b)(4), and
For example: If the adjusted basis of the facility is $500,000 and its
R&TC Sections 24449 and 23800).
useful life is 20 years, then compute the amortizable basis as follows:
D Election and Certification
$500,000 x 15 = $375,000
Make the election to amortize the amortizable basis of a certified
pollution control facility by completing Part I and Part II of form
The $375,000, if elected, will be amortized over 60 months. The
FTB 3580. Then apply for certification as follows:
remaining adjusted basis of $125,000 ($500,000 less $375,000) may
Air pollution. If this election applies to air pollution, apply for
be depreciated over 20 years, the useful life of the facility.
certification from the State Air Resources Board. Mail the original and
You may not increase the basis elected to be amortized by the cost of
two copies of the completed form FTB 3580 to:
additions or improvements after the amortization period begins.
STATIONARY SOURCE DIVISION
ATTN: DIVISION CHIEF
Amortizable basis – the portion of the adjusted basis that may be
amortized, for determining gain, of a certified pollution control facility.
STATE AIR RESOURCES BOARD
PO BOX 2815
Certified pollution control facility – a new identifiable treatment
SACRAMENTO CA 95812-2815
facility located in California and used, in connection with a plant
or other property in operation before January 1, 1976, to abate or
control water or atmospheric pollution or contamination by removing,
The State Air Resources Board will add its certification to Part III if
altering, disposing, storing, or preventing the creation or emission of
the facility meets the law requirements. They will return the original
and one copy of form FTB 3580 to you. Attach the original to the first
pollutants, contaminants, wastes, or heat.
tax return you file with the Franchise Tax Board (FTB) on which you
The facility must not significantly:
deduct the amortization. Keep the copy for your records.
Increase the output or capacity, extend the useful life, or reduce the
Water pollution. If this election applies to water pollution, apply for
total operating costs of such plant or other property.
certification from the State Water Resources Control Board. Mail the
Alter the nature of the manufacturing or production process, or
original and two copies of the completed form FTB 3580 to:
DIVISION OF WATER QUALITY
The State Air Resources Board (air pollution) or the State Water
ATTN: DEPUTY DIRECTOR
Resources Control Board (water pollution) must certify that the
STATE WATER RESOURCES CONTROL BOARD
pollution control facility conforms with the state program or
PO BOX 100
requirements for abatement or control of water, or atmospheric
SACRAMENTO CA 95812-0100
pollution or contamination.
New identifiable treatment facility – tangible property, not including
The State Water Resources Control Board will add its certification to
a building and its structural components unless the building is
Part III if the facility meets the law requirements. They will return the
exclusively a treatment facility, which is subject to an allowance for
original and one copy of form FTB 3580 to you. Attach the original
depreciation as provided in IRC Section 167. It must be identifiable
to the first tax return you file with the FTB on which you deduct the
as a treatment facility, and must meet one of the following two
amortization. Keep the copy for your records.
Side 2 FTB 3580 Instructions 2011