California Form 3864 - Group Nonresident Return Election - 2014
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1
2CALIFORNIA FORM
TAXABLE YEAR
Group Nonresident Return Election
2014
3864
Attach to Form 540NR and to the appropriate business entity return .
Business entity’s/corporation’s name
FEIN
CA corporation or CA Secretary of State (SOS) file no .
Business address (number and street, suite, PO Box, or PMB no .)
Telephone
(
)
Nature of business activity
City, state, and ZIP Code
State in which the principal
business activity is conducted
Principal California business address
Shareholders/Partners/Members/Directors
Number non-electing
Number electing
TERMS AND CONDITIONS OF FILING A GROUP NONRESIDENT RETURN
The above business entity/corporation and its electing nonresident individuals included in the filing of the group
nonresident return agree to the following terms and conditions:
a. Attach a Signed form FTB 3864 to the Group Nonresident Return. Each year the business entity/corporation must
make an election to file a group return on behalf of its electing nonresident individuals . Make the election by attaching
a completed form FTB 3864 to the group nonresident return (Form 540NR) . An authorized general partner, member-
manager, corporate officer, or an attorney-in-fact of the business entity/corporation must sign the form FTB 3864 .
b. Group Nonresident Return Must be a Calendar Year. A group nonresident return is not allowed to have a fiscal year
end . If the business entity has a fiscal year end, report on the 2014 group nonresident return the individual’s distributive
share of California source income from the business entity’s taxable year ending in 2014 . If the corporation has a fiscal
year end, report on the 2014 group nonresident return the director’s compensation that he or she received in 2014 .
c. Long Form 540NR, California Nonresident or Part-Year Resident Income Tax Return. Use Long Form 540NR for
the group nonresident return . Prepare the Form 540NR as instructed in FTB Pub . 1067, Guidelines for Filing a Group
Form 540NR .
d. Individual’s Election to be Included in the Group Nonresident Return is Irrevocable. Each year the business
entity/corporation will allow each nonresident individual the election to be included in the group nonresident return .
Only a qualified nonresident individual may elect to be included in the group nonresident return . Once the group
nonresident return is filed for the year, the individual’s election is irrevocable .
e. Qualified Nonresident Individual. A qualified individual must be an individual and must be a full-year nonresident of
California . In addition, the income from the business entity/corporation must be the only California source income of
the individual, unless the other California source income is being reported on another group nonresident return .
Partnerships, LLCs, corporations, estates, trusts (other than the grantor of grantor trusts described under IRC
Section 671-679 and not recognized as a separate taxable entity for income tax purposes), and other entities cannot
be included on the group nonresident return .
f. Powers-of-Attorney Maintained by Business Entity/Corporation. The business entity/corporation shall maintain a
file of powers-of-attorney executed by each electing nonresident individual . The powers-of-attorney shall authorize the
business entity/corporation to include the electing nonresident individual in the group nonresident return filed . Do not
attach the powers-of-attorney to the return .
g. Deductions.
• Shareholders/partners/members are not allowed deductions except those necessary to determine each individual’s
distributive share of income from the business entity . However, a deduction is allowed for contributions to qualified
deferred compensation plans attributable to earned income of a partner/member as provided in Subchapter D of
Chapter 1 of Subtitle A of the Internal Revenue Code, as modified by the California Revenue and Taxation Code
(R&TC) beginning with Section 17501 . No deduction to a qualified deferred compensation plan is allowed if the
individual has earned income from any other source .
• Directors are not allowed any deductions.
See FTB Pub .1067 for more information .
FTB 3864
2014 Side 1
7611143
C2
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