5806: Underpayment of Estimated Tax by Corporations (2025)
California · FTB · Used for tax years 2025
California Form 5806 calculates a corporation’s underpayment of estimated tax and any resulting penalty for 2025. It also includes worksheets to check penalty exceptions based on prior-year tax, annualized current-year income, or annualized seasonal income.
Who files this form
Form FTB 5806 is used to figure a corporation’s underpayment of estimated tax and any related penalty for tax year 2025.
The form gives these attachment rules:
- If Exception B or C is met for any installment, attach Form FTB 5806 to the back of Form 100, Form 100W, Form 100S, or Form 109.
- If Exception A for regular corporations, line 8a, is met for all four installments, do not attach Form FTB 5806 to the return.
What you'll need
Have the information needed for the parts you complete:
- Corporation name, California corporation number, and taxable-year beginning and ending dates.
- Current-year tax amount.
- Estimated tax payment dates, amounts paid or credited for each installment, and overpayments from previous installments.
- Prior-year tax amount if using Exception A. The prior-year return must cover a full 12 months.
- Taxable income by period, tax credits, and other taxes if using Exception B or C. Exception C also asks for income information from the three prior taxable years.
How to file
If Exception B or C is met for any installment, attach Form FTB 5806 to the back of Form 100, Form 100W, Form 100S, or Form 109. Do not attach it if Exception A for regular corporations, line 8a, is met for all four installments.
Enter the total estimated penalty from line 22b on the applicable return:
- Form 100, line 44a.
- Form 100W, line 41a.
- Form 100S, line 44a.
- Form 109, line 28.
The supplied form does not give a mailing address or e-filing directions.
Common mistakes
- Skipping the exceptions worksheets. If line 7 shows an underpayment for any installment, the form directs you to Part IV before figuring the penalty.
- Using a short prior-year return for Exception A. The prior-year return must cover a full 12 months.
- Overlooking the limits on Exception A for large corporations. Use it only if prior-year tax is less than current-year tax. The form says line 29 must be greater than line 28 for both the first and second installments.
- Completing fiscal-year-only lines as a calendar-year corporation. Lines 16 and 17 are for fiscal-year corporations only.
Questions people ask
Does an underpayment automatically mean a penalty?
No. Part IV says the Franchise Tax Board will not assess a penalty for an installment if timely payments equal or exceed the amount determined under any of the three exceptions for that installment period.
What are the three exceptions?
Exception A uses prior-year tax. Exception B uses tax on annualized current-year income. Exception C uses tax on annualized seasonal income.
When do I calculate a penalty in Part III?
If line 7 shows an underpayment for an installment and none of the three exceptions is met, complete lines 11 through 22 to figure the penalty for that installment.
Where do I find the total estimated penalty?
Line 22b totals the amounts from line 22a, columns (a) through (d). The form directs you to enter that total on the applicable corporate tax return.