Exempt Organization

[ljhyer]

I have a 501(c)12 client who files a 990 federal exempt org return and for the past 15+ years has been filing not a CA state 109 or 199 but a CA State corp return form 100 and paying the minimum $800 fee every year? Does this make any sense? What am I missing here? It's not a HOA, its a mutual road & well maintenance for a group of homeowners off grid. The statement of Information lists it as a CA nonprofit/cooperative corp.

[George4Tacks]

Is the organization registered with CA? http://rct.doj.ca.gov/Verification/Web/Search.aspx?facility=Y

There is also an annual RRF-1 that might be needed to file. 

Exempt is not my real strong suit, but it seems prior years with the 100 are probably incorrect.

I did find https://www.ftb.ca.gov/forms/misc/927.html#927-11

Mutual ditch or irrigation companies

California does not have a comparable section under R&TC Section 23701. R&TC Section 24405 may apply for exclusion of membership income.

They may be exempt under IRC Section 501(c)(12).

That may explain why they might not have filed for CA exemption. 

[ljhyer]

Thank you so much for your input, you've given me a lot of information to reveiw!!  It's still a work in progress.

[George4Tacks]

I went to a very informative one day workshop on Exempt Organizations. I left muttering "Never Again!"
I try really hard to be good at what I do and that area was just too random and foreign to what my practice was that I thereafter referred those clients that enjoyed and hopefully properly prepared that type of return.
Good luck.

[ljhyer · Accepted solution]

Well, I just got my answer and can't say I'm too delighted about it but at least the mystery is solved.  It seems that the client cannot get CA exempt status due to the fact that they charge members for water based upon usage rather than a flat fee so they have to file a  CA Corp return and a Federal Exempt return.

There is no way to generate a CA corp return in Lacerte's Exempt module AND there is no way to generate a CA corp return without a Federal corporate return so........... looks like I'm going to have to prepare the return twice....  with over 50 depreciable assets!!  

Not having fun in this tax office today ;-(

[George4Tacks]

Be sure to charge appropriately.
You can export depreciable assets from one module and then import to the other.
https://proconnect.intuit.com/community/help-articles/help/exporting-depreciation-data-to-a-file/00/...

[ljhyer]

Thanks George!!!!!