Looking for a California Tax Forms And Templates? Download it for free!

2015 Instructions for Form FTB 3725

Assets Transferred from Corporation to Insurance Company

What’s New

Specific Line Instructions

Line 15 and Line 17, column (b) – Description

of property. Describe the assets sold, or are no

Revenue and Taxation Code (R&TC)

Part I Assets Transferred from

longer used in an active trade or business, or are

Section 24465 requires a corporation to file

no longer held by an insurer in the commonly

Corporation to Insurance

an annual statement, form FTB 3725, Assets

controlled group of the transferor (or a member

Transferred from Corporation to Insurance

Company

of the taxpayer’s combined reporting group) .

Company, when property is transferred from

Line 15 and Line 17, column (d) – Percentage

a corporation to an insurance company .

Section A – Information on Property

of property. If the property was partially disposed

Effective for taxable years beginning on or

of, enter the percentage sold, or no longer used

Transferred

after April 1, 2015, Cal . Code Regs ., tit . 18

in an active trade or business, or no longer held

section 24465-3 requires more detailed

Line 1 – Enter the insurance company’s name,

by an insurer in the commonly controlled group

reporting for an annual statement . Also, the

California corporation number, or federal employer

of the transferor (or a member of the taxpayer’s

annual statement must be signed by both the

identification number (FEIN) . If the insurance

combined reporting group) . Otherwise, enter

corporation/transferor and the insurer .

company does not have one of these numbers,

100% .

enter “not applicable” and continue with line 2 .

Line 15 and Line 17, column (e) – Date . Enter

General Information

the date the property was sold, no longer used

Section B – Deferred Capital Gains

in an active trade or business, or no longer held

A Purpose

Line 3, column (a) – Taxable year. Enter the

by an insurer in the commonly controlled group

corporation’s taxable year in which the transfer of

of the transferor (or a member of the taxpayer’s

Use form FTB 3725 to track the assets transferred

property occurred .

combined reporting group .)

from a corporation to an insurance company .

Line 3, column (b) – Description of property

In addition, use this form to figure capital gains

Line 15 and Line 17, column (f) – Amount

transferred. Describe the assets the corporation

(losses) if the corporation transferred assets

realized or FMV. If the property was sold, enter

transferred to an insurance company .

to an insurance company beginning on or after

the amount realized . Otherwise, enter the FMV of

June 23, 2004 .

Line 3, column (e) – Fair market value (FMV)

the property as of the date it was no longer used

at date of transfer. FMV is the price that the

in an active trade or business or no longer held

R&TC Section 24465 provides that when a

property would sell for in the open market .

by an insurer in the commonly controlled group

corporation transfers appreciated property to

of the transferor (or a member of the taxpayer’s

an insurance company, the gain is deferred if

Line 3, column (f) – Adjusted basis of the

combined reporting group .)

the property transferred to the insurer is used in

transferred property on date of transfer. In

the active conduct of a trade or business of the

general, the cost or other basis is the cost of

Line 16 – Short-term capital gains (losses).

insurer . The gain must be recognized as income if

the property plus purchase commissions and

Total amounts in column (h) . Enter total short-

any of the following apply:

improvements minus depreciation, amortization,

term capital gains (losses) here and on Form 100

and depletion . Enter the cost or adjusted basis of

or Form 100W, Side 6, Schedule D, Part I, line 1,

• The transferred property is no longer owned

the asset for California purpose .

column (f) or Schedule D (100S), Section A

by an insurer in the taxpayer’s commonly

or Section B, Part I, line 1, column (f) . Write

controlled group (or a member of the

Part II Information on Stocks

on Schedule D, under column (a) Description

taxpayer’s combined reporting group) .

of property: “FTB 3725” and attach a copy of

• The property is no longer used in the active

Line 7, Line 8 and Line 9 – The transferred entity

form FTB 3725 to the tax return .

conduct of the insurer’s trade or business (or

is the entity whose stock was transferred from the

the trade or business of another member in

corporation to the insurer .

Line 18 – Long-term capital gains (losses).

the taxpayer’s combined reporting group) .

Total amounts in column (h) . Enter total long-term

Part III Assets Transferred from

• The holder of the property is no longer held

capital gains (losses) here and on Form 100 or

by an insurer in the commonly controlled

Insurance Company

Form 100W, Side 6, Schedule D, Part II, line 5,

group of the transferor (or a member of the

column (f) or Schedule D (100S), Section A

Line 13 – Check “No,” if the insurer disposed of

taxpayer’s combined reporting group) .

or Section B, Part II, line 4, column (f) . Write

the transferred property to an entity other than a

on Schedule D, under column (a) Description

R&TC Section 24465 applies to transactions

member of the corporation/transferor’s combined

of property: “FTB 3725” and attach a copy of

entered into on or after June 23, 2004 . For more

reporting group, or another insurer in the

form FTB 3725 to the tax return .

information, refer to R&TC Section 24465 .

transferor’s commonly controlled group .

B Definitions

Part IV Capital Gains and Losses

Appreciated property – Appreciated property

Complete Part IV to report the gain if any of the

means property whose fair market value (FMV),

following apply:

as of the date of the transfer, exceeds its adjusted

• The property is no longer owned by an insurer

basis as of that date .

in the taxpayer’s commonly controlled group

Commonly controlled group – Commonly

(or a member of the taxpayer’s combined

controlled group exists when stock possessing

reporting group) .

more than 50% of the voting power is owned,

• The property is no longer used in the active

or constructively owned, by a common parent

conduct of the insurer’s trade or business (or

corporation (or chains of corporations connected

the trade or business of another member in

through the common parent) or by members

the taxpayer’s combined reporting group) .

of the same family, see R&TC Section 25105 .

• The holder of the property is no longer held

Also, a commonly controlled group includes

by an insurer in the commonly controlled

corporations that are stapled entities, see R&TC

group of the transferor (or a member of the

Section 25105(b)(3) . Special rules are provided in

taxpayer’s combined reporting group .)

R&TC Section 25105 for partnerships, trusts, and

Report short-term or long-term capital gains

transfers of voting power by proxy, voting trust,

(losses) based on the length of time the

written shareholder agreement, etc .

corporation held the assets .

FTB 3725 Instructions 2015 Page 1

Form 3725 - California Assets Transferred From Corporation To Insurance Company - 2015 Page 3

Related Articles

Related forms

Related Categories