109: Exempt Organization Business Income Tax Return (2024)
California · FTB · Used for tax years 2024
California Form 109 is the Exempt Organization Business Income Tax Return. It reports unrelated business income, deductions, tax, payments, and any refund or amount due.
What you'll need
Have the organization's name, address, California corporation number, FEIN, accounting method, and unrelated business activity code ready.
Gather the records and attachments that apply to your return:
- Records of unrelated business income, expenses, tax credits, and payments, including 2024 estimated tax payments and amounts paid with an extension using Form FTB 3539.
- Forms 592-B and/or 593 for withholding reported on line 17.
- Schedule K-1 (565, 568, or 100S), or a similar schedule, for income or losses from partnerships, limited liability companies, or S corporations. The form says to attach it.
- Supporting schedules for other income and deductions such as interest, taxes, contributions, depletion, and other deductions.
- Federal Schedule H (Form 990) if the organization answers yes to the hospital question.
- Schedule D (541) for trusts reporting capital gain net income, and Form FTB 3885F for trust depreciation.
- Form FTB 5806 if the estimated tax penalty is computed using Exception B or C. Check the box on line 28 and attach the form.
Common mistakes
- Claiming deductions unrelated to the business income. Part II says deductions must be directly connected with unrelated business income, except for contributions.
- Including unrelated amounts in the apportionment worksheet. Schedule R says to use only unrelated trade or business amounts. Complete the part for the formula the corporation uses.
- Using Schedule J for a trust. Schedule J is for corporations and associations only. Trusts use Form FTB 3885F.
- Counting additional first-year depreciation twice. Schedule J says not to include the additional first-year depreciation reported on line 1 in the items below it.
Questions people ask
Can the organization receive its refund by direct deposit?
Yes. Complete the routing number, account number, and checking or savings selection on Side 2, line 26.
Can an overpayment be applied to next year's estimated tax?
Yes. On the 2024 return, line 25 lets you enter the amount of the line 24 overpayment to apply to 2025 estimated tax.
Who signs the return?
The signature area calls for an officer's signature, title, date, and telephone number. There is a separate area for a paid preparer's information and signature.
What if all unrelated business activity is in California?
For the taxable corporation calculation, if the unrelated business activity is wholly in California and Schedule R was not completed, enter the amount from Side 1, line 1 on line 3.