3805Z: Enterprise Zone Deduction and Credit Summary (2024)
California · FTB · Used for tax years 2024
California Form 3805Z summarizes Enterprise Zone hiring and sales or use tax credit carryovers, net operating loss carryovers and deductions, and the portion of business attributable to a former Enterprise Zone. It includes Schedule Z to calculate credit carryover limitations and
Who files this form
Form 3805Z is used to report Enterprise Zone (EZ) hiring and sales or use tax credit carryovers, and EZ net operating loss (NOL) carryovers and deductions.
The form provides entity boxes for individuals, estates, trusts, C corporations, S corporations, partnerships, exempt organizations, limited liability companies, and limited liability partnerships. The supplied form does not give a complete rule for who is required to file.
What you'll need
Have the following information and worksheets available to complete the form:
- Your name as shown on your California tax return, applicable tax identification number, and California Secretary of State file number.
- The EZ business name, actual business location, and name of the Enterprise Zone.
- The business activity code, total employees in the EZ, gross annual receipts, and total asset value.
- Prior-year hiring and sales or use tax credit carryover amounts.
- Worksheet I for apportionment and business income amounts, as applicable.
- Worksheet II for EZ NOL carryovers and deductions.
- Your California tax return for the tax amount used in Schedule Z.
- Form FTB 3544, Part A, column (g), if reporting assigned credits in Schedule Z.
How to file
Attach Form 3805Z to your California tax return.
The supplied form does not provide a mailing address or e-file directions.
Common mistakes
- Completing Part I before Schedule Z. The form says to complete Schedule Z on Side 2 first.
- Using the wrong location in item C. Enter the actual location where the EZ business is conducted.
- Overlooking the Long Beach code requirement. Item E asks for a six-digit Principal Business Activity Code, but directs Long Beach EZ businesses to enter an SIC code and see the instructions.
- Completing Schedule Z, line 2, as an individual. Individuals are told to enter Worksheet I, Section B, line 14, column (c), on both lines 1 and 3 and skip line 2.
- Exceeding the credit limit in Schedule Z, Part II. Column (f), the credit carryover used on Schedule P, can never exceed either column (d) or column (e).
Questions people ask
What if my business operates entirely within one former Enterprise Zone?
For Part II, line 2, the average apportionment percentage is 100% (1.00).
Where do I report my EZ net operating loss amounts?
Use Part III. Line 3a reports prior-year EZ NOL carryovers, line 3b reports the deduction used in the current year, and line 3c reports the carryover to future years. These amounts come from Worksheet II, line 9.
Does Schedule Z have a separate section for S corporations?
Yes. Part III is for S corporations only. Part IV is for corporations and S corporations subject to paying only the minimum franchise tax.
Where can I find the privacy notice?
The form directs you to FTB 1131 EN-SP for the privacy notice.