FTB 3500, Exemption Application filed:
Retroactive status is determined if the entity was organized and operating for nonprofit purposes within the provisions of its exempt code section.
FTB 3500A, Submission of Exemption Request filed:
For state income tax purposes, the effective date of an organization's tax-exempt status shall be no later than the federal effective date. If the federal effective date differs from the incorporation date, the organization should consider filing form FTB 3500, Exemption Application.
Example:
- ABC organization incorporated on 12/31/1999.
- Federal exempt status effective 12/31/2002.
- ABC organization filed form 3500A.
The state's effective date for ABC organization is 12/31/2002. To avoid the minimum franchise tax or annual tax, ABC organization must file form FTB 3500, Exemption Application to request an exemption retroactive to 12/31/1999.