3503: Natural Heritage Preservation Credit (2024)
California · FTB · Used for tax years 2024
California Form FTB 3503 figures the Natural Heritage Preservation Credit for qualified property contributions approved for acceptance by the Wildlife Conservation Board. It reports contribution details, available credits, credits claimed or assigned, and carryovers for future ye
Who files this form
Use Form FTB 3503 with your 2024 California tax return to figure the Natural Heritage Preservation Credit or claim a pass-through credit from an S corporation, estate, trust, partnership, or LLC classified as a partnership.
To qualify for a contribution-based credit, the property contribution must meet the stated Public Resources Code requirements and be approved for acceptance by the Wildlife Conservation Board (WCB). You must receive a WCB certificate confirming approval.
S corporations, estates, trusts, partnerships, and LLCs classified as partnerships also use this form to figure credits to pass through to shareholders, beneficiaries, partners, or members.
When it's due
For the 2024 tax-year form, the printed eligible contribution period is January 1, 2021, through June 30, 2026. Contributions made from July 1, 2020, through December 31, 2020, do not qualify.
The text does not give a calendar filing deadline for the 2024 return. If you elect to make credits disallowed by the business credit limitation refundable in future years, you must submit Form FTB 3870 with an original, timely filed return.
What you'll need
- WCB certificate: Use it to enter the donor's name, property type, acceptance date, approved fair market value, project name, and WCB ID number. Keep the certificate and provide it to the Franchise Tax Board if requested.
- Schedule K-1 (100S, 541, 565, or 568): Use applicable schedules for pass-through credits. Attach a schedule listing the names and identification numbers of the entities passing credits through to you.
- Your 2023 Form FTB 3503: Use it to find any carryover for line 5.
- Form FTB 3544, if applicable: Corporations assigning credits within the same combined reporting group must complete Part A.
- Form FTB 3870, if applicable: Complete and attach it if you elect to make eligible disallowed credits refundable in future years.
How to file
- Complete Part I using your WCB certificate. Use a separate Form FTB 3503 for each qualified contribution.
- In Part II, multiply the approved fair market value by 55%, add any pass-through credits, and enter any carryover from 2023.
- Enter the credit claimed, any assigned credit, and any amount elected as refundable in future years. Calculate the remaining carryover on line 8.
- Attach Form FTB 3503 to your California tax return. Use credit code 213 when claiming the credit.
Pass-through entities attach the form to Form 100S, 541, 565, or 568, as applicable, and report each recipient's credit on Schedule K-1.
The supplied text does not specify a mailing address or an e-file method.
Common mistakes
- Claiming without a WCB certificate: No credit is allowed unless you received the certificate confirming approval.
- Combining multiple contributions on one form: Figure each qualified contribution on a separate Form FTB 3503.
- Including assigned credits on line 7a: Do not include assigned credits claimed on Form FTB 3544, Part B. If you are not a corporation, enter 0 on line 7b.
- Claiming another state tax benefit for the same property: This credit replaces any other state tax credit or deduction otherwise allowed for the contributed property or interest.
- Making an incorrect refundable-credit election: Do not include credit limited by your tax liability, elect only part of the eligible disallowed credit, or include the elected refundable amount in line 8 carryover. The election must also cover all other credits claimed that year that were disallowed by the $5,000,000 limitation.
- Carrying the credit back: The credit cannot be applied against a prior year's tax.
Questions people ask
How much is the credit?
The credit equals 55% of the fair market value of a qualified contribution approved for acceptance by the WCB. The amount you can claim may be limited by your tax liability and other stated limitations.
Can I carry unused credit forward?
Yes. For credits generated on or after January 1, 2015, unused credit may be carried forward for up to 15 years or until exhausted, whichever comes first. Apply it to the earliest possible taxable year. Credits disallowed by the business credit limitation may receive an extended carryover period if no refundable-credit election is made.
Is the credit refundable?
The credit is generally nonrefundable. However, credits disallowed by the $5,000,000 business credit limitation may qualify for an irrevocable election to receive refunds in future years using Form FTB 3870. S corporations cannot make this election for credits taken at the entity level.
Where can I ask about qualifying contributions?
Contact the WCB at 916.445.8448 or visit wcb.ca.gov.