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Changes to 2009 Forms

Updates to the Form 3565 on 02/24/2014 –– Small Business Stock Questionnaire

We replaced text on:

  1. Side 1, Question O
  2. Page 1, Column 1
  3. Page 1, Column 1, General Information, third paragraph

Previous Version

  1. O. Since the issuance of non-treasury stock, were at least 80% (by value) of the corporation’s assets used in the active conduct of one or more qualified trades or businesses in California?
    See instructions...... Yes No
  2. What’s New
    Qualified Small Business Stock – California law does not conform to the federal law in regard to the increase in the percentage (from 50% to 75%) of the gain exclusion for the sale of qualified small business stock acquired after February 17, 2009, and before January 1, 2011. Current California law allows an exclusion of 50% of any gain from the sale or exchange of qualified small business stock held for more than 5 years.
  3. Note: new text added.

Revised Version

  1. O. Since the issuance of non-treasury stock, were at least 80% (by value) of the corporation’s assets used in the active conduct of one or more qualified trades or businesses?
    See instructions...... Yes No
  2. Note: text deleted.
  3. California law does not conform to federal law changes regarding the increase in the percentage of the gain exclusion for the sales of qualified small business stock acquired after February 17, 2009. California law allows an exclusion of 50% of any gain from the sale or exchange of qualified small business stock held for more than 5 years. For California purposes, 80% of the issuing corporation’s payroll must be attributable to employment located within California (at time of issuance). Also, at least 80% of the value of the corporation’s assets must be used by the corporation to actively conduct one or more qualified trades or businesses.

    For more information, go to ftb.ca.gov and search for qsbs.

Reason for the changes

AB 1412 (Stats.2013, ch. 546), signed by the Governor on October 4, 2013, retroactively allows the Qualified Small Business Stock (QSBS) deferral and 50 percent gain exclusion for tax years 2008 through 2012.

Impact

No tax impact.

Back to Tax Form Changes for 2009

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