3809: Targeted Tax Area Deduction and Credit Summary (2025)
California · FTB · Used for tax years 2025
California Form 3809 summarizes Targeted Tax Area hiring and sales or use tax credit carryovers, along with net operating loss carryovers and deductions. It includes calculations for credit limitations and the portion of business attributable to the former Targeted Tax Area, and
Who files this form
Form 3809 reports Targeted Tax Area (TTA) hiring and sales or use tax credit carryovers, along with TTA net operating loss (NOL) carryovers and deductions.
The form lists these entity types: individuals, estates, trusts, C corporations, S corporations, partnerships, exempt organizations, limited liability companies, and limited liability partnerships. It must be attached to your California tax return.
What you'll need
The form calls for:
- Your name as shown on your California tax return and the applicable taxpayer and business identification numbers.
- Your TTA business name, actual business address, specific TTA area, SIC code, and six-digit Principal Business Activity code.
- The number of employees in the TTA, gross annual business receipts, and total business asset value.
- Worksheet I figures for the business apportionment percentage and applicable business income.
- Worksheet II figures for prior-year NOL carryovers, the current-year NOL deduction, and carryovers to future years.
- Prior-year hiring and sales or use tax credit carryover amounts.
- Tax amounts from your California tax return and, if applicable, credit assignment amounts from Form FTB 3544, Part A, column (g).
How to file
Attach Form 3809 to your California tax return.
Complete Schedule Z on Side 2 before completing Part I on Side 1. Use Worksheet I to complete the business apportionment entry in Part II and Worksheet II for the NOL entries in Part III.
The provided form does not give a mailing address or e-filing directions.
Common mistakes
- Do not complete Part I before Schedule Z. The form specifically says to complete Schedule Z first.
- Do not omit Form 3809 from your California tax return. The form says to attach it.
- Individuals completing Schedule Z, Part I, must enter the Worksheet I, Section B, line 14, column (c) amount on both lines 1 and 3, and skip line 2.
- In Schedule Z, Part II, the credit carryover used on Schedule P in column (f) cannot be greater than either column (d) or column (e).
Questions people ask
What percentage do I enter if my business operates entirely within the former TTA?
Enter 100% (1.00) on Part II, line 2. Otherwise, that line uses the average apportionment percentage from Worksheet I, Section A, line 4.
Where do I find the credit carryover amounts for Part I?
For the hiring credit, use Schedule Z, line 8A, column (f), or line 10, column (c). For the sales or use tax credit, use Schedule Z, line 9A, column (f), or line 11, column (c).
Where do I report the current-year TTA NOL deduction on my tax return?
Form 3809, Part III, line 3b directs you to enter the deduction on the applicable return: Schedule CA (540), Part I, Section B, line 9b3, column B; Schedule CA (540NR), Part II, Section B, line 9b3, column B; Form 100 or Form 100W, line 20; Form 100S, line 18; or Form 109, line 6.
Which part of Schedule Z applies to S corporations?
Part III is for S corporations only. Part IV is for corporations and S corporations subject to paying only the minimum franchise tax. The form refers you to the instructions for these parts.