Form instructions for taxable year 2025 relating to credit for prior year alternative minimum tax or minimum tax credit Tax News Flash

February 12, 2026

Franchise Tax Board (FTB) updated the following form instructions for taxable year 2025:

  • Schedule P (100) Instructions
    • Specific Line Instructions, Part III, Line 1
  • Schedule P (100W) Instructions
    • Specific Line Instructions, Part III, Line 1
  • Form FTB 3510 Instructions
    • Specific Line Instructions, Line 28

The updates relate to the computation of the credit for prior year alternative minimum tax, which is also referred to as the "minimum tax credit."

Specifically, FTB deleted the following sentence in Schedule P (100) Instructions, Specific Line Instructions, Part III, Line 1 instruction:
  • If this amount was reduced by any credits from Part II, Section C, use the AMT from the 2024 Schedule P (100), Section C, line 18.

FTB deleted the following sentence in Schedule P (100W) Instructions, Specific Line Instructions, Part III, Line 1 instruction:

  • If this amount was reduced by any credits from Part II, Section C, use the AMT from the 2024 Schedule P (100W), Section C, line 18.

FTB deleted the following sentence in FTB 3510 Instructions, Specific Line Instructions, Line 28 instruction:

  • Line 28 – Reduce the amount on line 28 by the same amount shown on one of the forms below if you reduced your 2024 AMT by any solar energy credit carryover or commercial solar energy credit carryover:
    • Schedule P (540), Part III, line 23 and line 24, column (b).
    • Schedule P (540NR), Part III, line 23 and line 24, column (b).
    • Schedule P (541), Part IV, line 18 and line 19, column (b).
  • Write the amount of the reduction in the space to the left of line 28.

Prior to the update, the line instructions for the minimum tax credit required taxpayers to reduce their prior year alternative minimum tax (AMT) with the credits taxpayers used to lower their prior year AMT. The updated form instructions no longer require that reduction.

With the update, corporate taxpayers compute their minimum tax credit by adding their prior year AMT and their prior year unused allowable minimum tax credit carryover. Individual and fiduciary taxpayers generally compute the minimum tax credit in the same manner to the extent the amount of AMT was attributable to deferral preferences.

For updated forms and instructions, go to Forms and publications.

Last updated: 02/12/2026