3548: Disabled Access Credit for Eligible Small Businesses (2024)

Who files this form

Eligible small businesses use Form FTB 3548 to claim a credit for eligible expenses that provide access to individuals with disabilities.

To qualify, a business or person must:

• Have had gross receipts of $1 million or less in the preceding taxable year, or, if receipts exceeded $1 million, have employed no more than 30 full-time employees during that year.
• Comply with the federal Americans with Disabilities Act of 1990 and pay or incur eligible access expenditures.
• Elect to claim the credit by filing Form FTB 3548.

For this purpose, a full-time employee works at least 30 hours per week for 20 or more calendar weeks in the taxable year. Gross receipts are reduced by returns and allowances.

Also use this form to claim pass-through Disabled Access Credits from S corporations, estates, trusts, partnerships, or LLCs classified as partnerships. These entities should complete the form to figure credits passed through to their shareholders, beneficiaries, partners, or members.

What you'll need

Have the following information and applicable forms available:

• Your name as shown on your California tax return, the applicable identification numbers, and the facility address.
• Total eligible access expenditures paid or incurred during the current taxable year.
• Any prior-year credit carryover.
• Schedule K-1 (100S, 541, 565, or 568) showing pass-through credits, if applicable. For line 5, attach a schedule showing the names and identification numbers of the entities passing credits through to you.
• Form FTB 3544, Part A, if your corporation assigns credit within its combined reporting group.
• Form FTB 3870, if you elect to make credits disallowed by the $5,000,000 business credit limitation refundable in future years.

How to file

Attach Form FTB 3548 to your California tax return. Use credit code 205 when claiming the credit.

S corporations, estates, trusts, partnerships, and LLCs classified as partnerships attach the form to Form 100S, 541, 565, or 568, as applicable. Show each recipient's pass-through credit on Schedule K-1 (100S, 541, 565, or 568).

If you make the election for future refundable credits, attach a completed Form FTB 3870 to your original, timely filed tax return.

The supplied text does not provide a mailing address or e-file instructions.

Common mistakes

• Exceeding the current-year credit limit. Line 6, including pass-through credits, cannot exceed $125.
• Including assigned credits on line 9a. Do not include assigned credits claimed on Form FTB 3544, Part B. If you are not a corporation, enter 0 on line 9b.
• Claiming an unreduced deduction for the same expenses. Reduce any deduction allowed for those expenses by the credit claimed or assigned for the current taxable year.
• Carrying the credit back. Unused credit may be carried forward, but not applied against a prior year's tax. Apply carryovers to the earliest taxable year.
• Including ineligible amounts in a refundable-credit election. Do not include credit limited by your tax liability. You cannot elect to make only part of the credit disallowed by the $5,000,000 limitation refundable, and the election must cover all other credits claimed that year and disallowed by that limitation.
• Counting elected refundable amounts as carryovers. Do not include amounts elected as refundable on Form FTB 3870 in line 10.

Questions people ask

How much is the California credit?

The credit is 50% of eligible access expenditures up to $250. The maximum credit generated per eligible small business per taxable year is $125.

What expenses can qualify?

Eligible expenses include removing access barriers, providing qualified interpreters or readers, making audio or visual materials accessible, acquiring or modifying equipment, and providing similar services or materials. Expenses must be reasonable and necessary to comply with applicable Americans with Disabilities Act requirements. Barrier-removal expenses qualify only for a facility first placed in service before November 6, 1990.

What happens if I cannot use all the credit this year?

Unused credit that exceeds your current-year tax liability can be carried forward until exhausted. It cannot be carried back to a prior year.

Is the credit refundable?

The credit is generally not refundable. However, for taxable years beginning on or after January 1, 2024, and before January 1, 2027, credits disallowed by the $5,000,000 business credit limitation may qualify for an irrevocable election on Form FTB 3870. The election allows 20% to be claimed annually over five years, starting in the third taxable year after the election year. S corporations cannot make this election for credits taken at the entity level.

Official sources

• https://www.ftb.ca.gov/forms/2024/2024-3548.pdf