Instructions For Form Ftb 3805v - Net Operating Loss (Nol) Computation And Nol And Disaster Loss Limitations - Individuals, Estates, And Trusts - 2016 Page 6

ADVERTISEMENT

NOL Carryover
Type of NOL and Description
Taxable Year
NOL
Carryover*
*Note: The carryover period for any NOL or NOL carryover, for which a deduction is disallowed because of the
NOL Incurred
Carried Over
Period
2008-2011 suspension, is extended. For more information, see General Information.
General
Available as a result of a loss incurred in years after 1986 and allowed under R&TC Section 17276.20.
On or after
Does not include losses incurred from activities that qualify as a new business, an eligible small business, an EZ,
01/01/2008
100%
20 Years
LARZ, LAMBRA, TTA, disaster loss, or to Pierce’s disease.
2004-2007
100%
10 Years
2002-2003
60%
10 Years
2000
-2001
55%
10 Years
1
1987-1999
None
Expired
Disaster Losses
Casualty losses sustained as the result of a disaster, not reimbursed by insurance or otherwise, and declared by
See
the President of the United States or the Governor of California to warrant assistance. For taxable years beginning
“Declared
on or after January 1, 2014, and before January 1, 2024, if the disaster is declared by the Governor only, no
Disasters”
subsequent state legislation is required for the disaster loss provisions to be activated. For taxable years before
list on page 4
2014, if the disaster was declared by the Governor only, subsequent state legislation was required for the disaster
provision to be activated.
If the loss qualifies under IRC Section 165(i), the taxpayer may elect to deduct the loss from the previous
year’s income. If the taxpayer made this election, see Part III, Current Year NOLs, line 3 and federal Form 4684
instructions for when the election must be filed.
Prior to
100%
First
If special legislation is enacted under the R&TC, 100% of the excess loss may be carried over for up to five years.
01/01/2011
5 Years
If any excess loss remains after the five year period, 50% of that remaining loss may be carried over for up to ten
additional taxable years for losses incurred in any taxable year beginning before January 1, 2000; 55% for losses
10 Years
incurred in any taxable year beginning on or after January 1, 2000, and before January 1, 2002; 60% for losses
Thereafter
incurred in any taxable year beginning on or after January 1, 2002, and before January 1, 2004; or 100% for losses
incurred in any taxable year beginning on or after January 1, 2004.
On or after
See Description
See Description
The following rules would apply if state legislation is enacted; or the President declared an area a major disaster; or
01/01/2011
the Governor declared an area a major disaster for taxable years beginning on after January 1, 2014:
A taxpayer can claim 100% of the disaster loss deduction in the year the loss was incurred, or make an election
under IRC Section 165(i) to claim the disaster loss deduction against the previous year’s income. For taxable years
beginning on or after January 1, 2011, if the disaster loss deduction creates an NOL (whether in the year of the
loss or the prior year), the applicable NOL carryforward rule for the taxable year the NOL was created would apply.
The NOL can be carried over for 20 years. See Specific Line Instructions for more information.
For taxable years beginning on or after January 1, 2013, if the disaster loss deduction creates an NOL (whether in
the year of the loss or the prior year), the applicable NOL carryback and carryforward rules for the taxable year the
NOL was created would apply. The taxpayer must carryback the NOL attributable to the disaster loss for two years
or elect to carryforward the NOL for 20 years. See NOL Carryback Table and Specific Line Instructions for more
information.
New Business Get FTB Legal Ruling 96-5 issued August 19, 1996, for more information.
On or after
100%
20 Years
New Business means any trade or business that first commenced in California on or after January 1, 1994. 100% of
01/01/2008
an NOL may be carried over, but only to the extent of the net loss from the new business. If a taxpayer’s NOL exceeds
the net loss from the new business, the excess may be carried over as a general NOL.
On or after
100%
10 Years
01/01/2000
For the
1
If a taxpayer acquires assets of an existing trade or business which is doing business in California, the trade or
and before
first three
business thereafter conducted by the taxpayer or related persons (IRC Sections 267 or 318) is not a new business if
01/01/2008
years of
the fair market value (FMV) of the acquired assets exceeds 20% of the FMV of the total assets of the trade or business.
business
If a taxpayer or related person has been engaged in a trade or business in California within the preceding 36
months and thereafter commences an additional trade or business in California, the additional trade or business
On or after
qualifies as a new business only if the activity is classified under a different division of the Standard Industrial
01/01/1994
Classification (SIC) Manual, 1987 Edition. Business activities conducted by the taxpayer or related persons wholly
and before
outside California are disregarded in determining whether the trade or business conducted within California is a
01/01/2000
new business.
The term “new business’’ includes any taxpayer engaged in biopharmaceutical activities or other biotechnology
Year of
activities described in Codes 2833 to 2836 of the SIC Manual, 1987 Edition. It also includes any taxpayer that has
Business
not received regulatory approval for any product from the United States Food and Drug Administration.
Year 1
None
Expired
See R&TC Section 17276.20(f)(7)(A) for more information.
Year 2
None
Expired
Year 3
None
Expired
Eligible Small Business Get FTB Legal Ruling 96-5 issued August 19, 1996, for more information.
On or after
100%
20 Years
An ESB NOL is an NOL incurred in operating a trade or business activity that has gross receipts, less returns and
01/01/2008
allowances, of less than $1 million during the taxable year.
100% of an ESB NOL may be carried over, but only to the extent of the net loss from the eligible small business. If
On or after
100%
10 Years
a taxpayer’s NOL exceeds the net loss from an eligible small business, the excess may be carried over as a general
01/01/2000
1
NOL.
and before
01/01/2008
Taxpayers should use the same SIC Code tests described in the “New Business NOL,’’ above, to group trade or
business activities for the eligible small business NOL.
On or after
None
Expired
01/01/1994
and before
01/01/2000
1
The NOL carryover deduction for GEN, NB, or ESB NOL incurred on or after 01/01/2000 and before 01/01/2001 expired in 2016.
Page 6 FTB 3805V Instructions 2016

ADVERTISEMENT

00 votes

Related Articles

Related forms

Related Categories

Parent category: Financial
Go
Page of 6