How do you suppress the minimum franchise tax for an initial California 100S in Lacerte
by Intuit• Updated 3 months ago
Per the CA 100S instructions,
For the first taxable year, the corporation will not be subject to the minimum franchise tax and will compute its tax liability by multiplying its state net income by the appropriate tax rate. The corporation will become subject to minimum franchise tax beginning in its second taxable year. This does not apply to qualified Subchapter S subsidiaries or corporations that are not qualified by the California SOS, or reorganize solely to avoid payment of the minimum franchise tax.
To mark the CA return as an initial return and compute the tax by the above instructions:
- Go to Screen 42.011 California Miscellaneous.
- Scroll down to the California Miscellaneous section.
- Check the box, Initial return in California (code 16).
This check box will remove the $800 franchise tax from Form 100S, line 21 and instead will multiply line 20 by the applicable tax rate .
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