3820: High-Road Cannabis Tax Credit (2025)
California · FTB · Used for tax years 2025
California Form 3820 calculates the High-Road Cannabis Tax Credit and is attached to your California tax return. It reports license information, qualified expenditures, pass-through credits, credit claimed or assigned, amounts elected as refundable in future years, and credit car
Who files this form
Form 3820 is used to report the High-Road Cannabis Tax Credit on your California tax return.
- Qualified taxpayers conducting a licensed commercial cannabis business complete Part I, Items A through E. The listed license types are Type-10 (retailer) and Type-12 (micro-business).
- Shareholders, beneficiaries, partners, or members receiving the credit from a pass-through entity complete only Items C and E in Part I.
The form states that a business without a tentative credit reservation (TCR) from the Franchise Tax Board does not qualify for the credit.
What you'll need
Have the following information and records available, as applicable:
- Your name and identifying numbers as shown on your California tax return.
- Your California Department of Cannabis Control license information, including the business name, license type, and license number.
- Your TCR confirmation number.
- Worksheet I, line 1, column (k), for qualified employment compensation expenditures.
- Amounts for safety-related equipment, training, and services, and for workforce development and employee safety training.
- Schedule K-1 (100S, 541, 565, or 568) if you received a pass-through credit.
- Any credit carryover amount from prior years.
- Form FTB 3544, Part A, column (g), if you assigned credit.
How to file
Attach Form 3820 to your California tax return.
- Qualified taxpayers: Complete Part I, Items A through E, and Part II, lines 1 through 6 and 8 through 11. Skip line 7.
- Pass-through credit recipients: Complete Part I, Items C and E, and Part II, lines 7 through 11. Skip Items A, B, and D and lines 1 through 6.
The supplied form does not state a mailing address or e-filing instructions.
Common mistakes
- Do not claim eligibility for a business that did not obtain a TCR from the Franchise Tax Board. Item D says that business does not qualify.
- Check only one license type in Item B.
- Follow the separate completion directions for qualified taxpayers and pass-through credit recipients. They complete different items and lines.
- Do not include assigned credit claimed on Form FTB 3544, Part B, in line 10a.
- If you are not a corporation, enter zero on line 10b.
Questions people ask
How is the credit calculated for a qualified taxpayer?
Add qualified employment compensation expenditures, safety-related equipment, training and services expenditures, and workforce development and employee safety training expenditures. Multiply the total by 25%. Line 6 is the smaller of that result or $250,000.
Where do I report a credit received from a pass-through entity?
Enter the pass-through credit from Schedule K-1 (100S, 541, 565, or 568) on line 7. Pass-through credit recipients skip lines 1 through 6 and complete lines 7 through 11.
Where do I enter credit carried over from earlier years?
Enter credit carryovers from prior years on line 8. Add lines 6 through 8 to calculate the total available credit on line 9.
How do I calculate the carryover available for future years?
Add lines 10a, 10b, and 10c, then subtract that total from line 9. Enter the result on line 11.
Does the form include a refundable-credit election?
Yes. Line 10c is for a credit amount elected as refundable in future years. The form directs you to the instructions, but those instructions were not supplied here.