California Form 3885l - Depreciation And Amortization - 2012 Page 2

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Additional differences may occur for the following:

Line 4 – California amortization for intangibles placed in service before

January 1, 2012.

• Luxury Automobile Depreciation: California generally conforms to the

Enter total California amortization for intangibles placed in service prior

federal 2003 increase (IRC Section 280F) for the limitation on luxury

to January 1, 2012, taking into account any differences in asset basis or

automobile depreciation . In addition, SUVs and minivans built on a truck

differences in California and federal tax law .

chassis are included in the definition of trucks and vans when applying

the 6,000 pound gross weight limit .

Assets with a Federal Basis Different from California Basis

• Amortization of Certain Intangibles (IRC Section 197): Property

Some assets placed in service on or after January 1, 1987, will have a

classified as Section 197 property under federal law is also Section 197

different adjusted basis for California purposes due to the credits claimed

property for California purposes . There is no separate California election

or accelerated write-offs of the assets . Review the list of depreciation and

required or allowed . However, for Section 197 property acquired before

amortization items in the instructions for Schedule CA (540), California

January 1, 1994, the California adjusted basis as of January 1, 1994,

Adjustments — Residents, and Schedule CA (540NR), California

must be amortized over the remaining federal amortization period .

Adjustments — Nonresidents or Part-Year Residents . If the LLC has any

• Qualified Indian Reservation Property: California has not conformed

other adjustments to make, get FTB Pub . 1001, Supplemental Guidelines to

to the accelerated recovery periods available under the Alternative

California Adjustments, for more information .

Depreciation System (ADS) for such property .

Line 6 – Total Depreciation and Amortization

• Grapevines subject to Phylloxera or Pierce’s Disease: For California

Add line 3 and line 5 . Enter the total on line 6 and on Form 568, Schedule B,

purposes, replacement grapevines may be depreciated using a recovery

line 17a .

period of five years instead of ten years .

If depreciation or amortization is from more than one trade or business

This list is not intended to be all-inclusive of the federal and state differences .

activity, or from more than one rental real estate activity, the LLC should

For additional information, please refer to California’s R&TC .

separately compute depreciation for each activity . Use the depreciation

computed on this form to identify the net income for each activity . Report

Specific Line Instructions

the net income from each activity on an attachment to Schedule K-1

(568), Member’s Share of Income, Deductions, Credits, etc ., for purposes

Line 1 – California depreciation for assets and amortization for intangibles

of passive activity reporting requirements . Use California amounts

placed in service during the current taxable year.

to determine the depreciation amount to enter on line 14 of federal

Complete column (a) through column (i) for each asset or group of assets

Form 8825, Rental Real Estate Income and Expenses of a Partnership or an

or property placed in service during the current taxable year . Enter the

S Corporation .

column (f) totals on line 1(f) . Enter the column (i) totals on line 1(i) .

Line 7

Line 2 – California depreciation for assets placed in service before

Enter the IRC Section 179 expense election amount from line 12 of the

January 1, 2012.

following worksheet .

Enter total California depreciation for assets placed in service prior to

These limitations apply to the LLC and each member .

January 1, 2012, taking into account any differences in asset basis or

differences in California and federal tax law .

Election to Expense Certain Tangible Property (IRC Section 179) Worksheet

Follow the instructions on federal Form 4562, Depreciation and Amortization, for listed property .

$ 25,000

1 Maximum dollar limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

2 Total cost of IRC Section 179 property placed in service during the taxable year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 __________________

$200,000

3 Threshold cost of IRC Section 179 property placed in service during the taxable year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

4 Reduction in limitation . Subtract line 3 from line 2 . If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 __________________

5 Dollar limitation for taxable year . Subtract line 4 from line 1 . If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 __________________

(a)

(b)

(c)

Description of property

Cost

Elected cost

7 Listed property . Use federal Form 4562, Part V, line 29 . Make any adjustments for California law and basis differences . . . . . . . . . 7 __________________

8 Total elected cost of IRC Section 179 property . Add amounts in column (c), line 6 and line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 __________________

9 Tentative deduction . Enter the smaller of line 5 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 __________________

10 Carryover of disallowed deduction from 2011 . See instructions for line 10 through line 13 on federal Form 4562 . . . . . . . . . . . . . 10 __________________

11 Income limitation . Enter the smaller of line 5 or the aggregate of the LLC’s items of income and expense described in

IRC Section 702(a) from any business actively conducted by the LLC, other than credits, tax-exempt IRC Section 179

expense deduction, and guaranteed payments under IRC Section 707(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 __________________

12 IRC Section 179 expense deduction . Add line 9 and line 10, but do not enter more than line 11 . Enter on

Schedule K (568), line 12 and on form FTB 3885L, line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 __________________

13 Carryover of disallowed deduction to 2013 . Add line 9 and line 10 and subtract line 12 . Enter here and on line 8

of form FTB 3885L . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 __________________

Page 2 FTB 3885L Instructions 2012