California Franchise Tax Board issues Technical Advice Memorandum on application of IRC Sections 382-384 for apportioning taxpayers

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April 28, 2017


On April 6, 2017, the California Franchise Tax Board issued Technical Advice Memorandum (TAM) 2017-03.  The TAM addresses the application of Internal Revenue Code sections 382-384 for California tax purposes for apportioning taxpayers.

The TAM provides that the IRC section 382(b)(1) limitation for net operating losses and 383(a)(1) limitation for excess credits are to be applied on a pre-apportionment basis, while items of net income such as realized built-in gains and losses and net unrealized built-in gains and losses are to be determined on a post-apportionment basis.

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Peter Michalowski

Peter Michalowski

State and Local Tax Leader, PwC US

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