Main Street Small Business Tax Credit II – Don't forget to claim it!February 2022 Tax News
The credit is for California businesses impacted by recent economic disruptions resulting from COVID-19
To claim the credit, taxpayers were required to obtain a tentative credit reservation from the California Department of Tax and Fee Administration (CDTFA) in November of 2021. On their credit reservation, taxpayers made an irrevocable election to apply it to either Sales and Use taxes, or Franchise and Income taxes.
Taxpayers who elected to apply their credit to their Franchise and Income taxes must claim their credit by filing form FTB 3866, Main Street Small Business Tax Credits, with their timely filed, original tax return (including extensions). The form FTB 3866 must be included with their 2021 tax return, even if the taxpayer cannot utilize the tax credit on that year's return. Any credit not utilized on the 2021 tax return can be carried over for up to five years. The credit cannot be claimed on an amended return.