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Updates to 2007 Form

Schedule R – Apportionment and Allocation of Income

Schedule R – Apportionment and Allocation of Income

The revised Internet version is available for download as of 03/26/2008

Revision Details: Revision 1: Line 4 asks taxpayers to report –Total interest income– from Form 100S, side 1, line 3 and the interest income included on Schedule F, line 5 and Schedule K, line 4. Schedule K, line 4 is the same amount as Schedule F, line 5 plus line 3 of the 100S. The taxpayer only needs to report the total interest income one time.
Revision 2: Line 2 should say net income (loss) since a positive or negative amount can be reported on this line. Line 5 and line 11 should be a positive number or zero for calculation purposes. If the total of these lines are a negative you cannot take a contributions adjustment.
Revision 3: The current instructions refers to the wrong legal ruling number, we are changing this to reflect the correct legal ruling number.
Revision 4: The current instructions refers to the wrong Revenue and Tax Code (R&TC) section, we are changing this to reflect the correct R&TC section.

  • Revision 1 – Schedule R-5, Computation of Interest Offset, Line 4
    Revision 2 – Schedule R-6, Contribution Adjustment, Lines 2, 5, and 11
    Revision 3 – Schedule R Instructions, Page 5, Column 2, Paragraph L
    Revision 4 – Schedule R Instructions, Page 6, Column 2, Paragraph 1
    and pages 727, 734, and 735 of the Package X

Previously read:

Revision 1: 4  …interest income included on Schedule F, line 5 and Schedule K, line 4)
Revision 2: 2  Net income after state adjustments from side 1, line 1c
5  Total. Add line 2 through line 4
11  Total. Add line 7 through line 10
Revision 3: (see FTB Legal Ruling 431)
Revision 4: …minimum franchise tax provided for in R&TC Sections 25135 and 23181.

Revised to:

Revision 1: 4  …interest income included on Schedule F, line 5 or Schedule K, line 4)
Revision 2: 2  Net income (loss) after state adjustments from side 1, line 1c
5  Total. Add line 2 through line 4. If zero or less, enter -0-
11  Total. Add line 7 through line 10. If zero or less, enter -0-
Revision 3: (see FTB Legal Ruling 413)
Revision 4: …minimum franchise tax provided for in R&TC Sections 23153 and 23181.

Revision 1: By having "and" instead of "or" S Corporations could double include total interest in the interest offset computation. The double inclusion of total interest would result in the S Corporation having an incorrect interest offset amount. This interest should only be included one time in the calculation.
Revision 2: By having the contribution limitation calculated as a negative number, taxpayers could reduce their loss attributable to California.
Revision 3: If a taxpayer looked at this legal ruling it would cause confusion. This change has no tax impact.
Revision 4: If a taxpayer looked at this R&TC section it would cause confusion. This change has no tax impact.

Back to Tax Form Changes for 2007

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