The California 109 form is a tax return specifically designed for exempt organizations operating in California. This form allows these organizations to report their unrelated business income and determine their tax obligations for the year. If you are part of an exempt organization, be sure to fill out the California 109 form accurately to ensure compliance with state tax regulations.
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The California Form 109 is an essential document for exempt organizations operating within the state. This form is primarily used to report unrelated business taxable income, which is income generated from activities that are not directly related to the organization's exempt purpose. Organizations must provide detailed information, including their name, address, and federal employer identification number (FEIN). Additionally, the form requires answers to several key questions, such as whether it is the organization's first return or if it is under audit by the IRS. It also covers various tax benefits, accounting methods, and deductions related to unrelated business activities. The form is structured to help organizations calculate their taxable income and determine any tax owed, including credits and payments made. For organizations involved in multiple business activities, the form includes sections to report income from different sources, such as rental income and investment income. Understanding how to accurately complete this form is crucial for compliance and for maximizing potential tax benefits.
TAXABLE YEAR
California Exempt Organization
FORM
109
2021
Business Income Tax Return
Calendar Year 2021 or fiscal year beginning (mm/dd/yyyy)
, and ending (mm/dd/yyyy)
Corporation/Organization name
California corporation number
Additional information. See instructions.
FEIN
Street address (suite/room no.)
PMB no.
City (If the corporation has a foreign address, see instructions.)
State
ZIP code
Foreign country name
Foreign province/state/county
Foreign postal code
A First return filed?
. . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . .
. . .
□ Yes
□ No
H Is the organization a non-exempt charitable trust as
B Is this an education IRA within the meaning of
described in IRC Section 4947(a)(1)? . . . .
. .
. . . . . . .
. . . • □ Yes
R&TC Section 23712?
I Is this organization claiming any former; Enterprise Zone
C Is the organization under audit by the IRS or has the IRS
(EZ), Local Agency Military Base Recovery Area (LAMBRA),
•□ Yes
Targeted Tax Area (TTA), or Manufacturing Enhancement
audited in a prior year?
D Final return?
Area (MEA) tax benefits?
.
• □ Dissolved
□ Surrendered (Withdrawn)
□ Merged/Reorganized
J Is this organization a qualified pension, profit-sharing,
Enter date(mm/dd/yyyy)
•
/
or stock bonus plan as described in IRC
• □ Yes
E Amended return?
. . . . . . . . . . . . . .Section 401(a)?
. . . . . . . . . .
K Unrelated Business Activity (UBA) code . .
.•
F Accounting method used: (1) □ Cash (2) □ Accrual
(3) □ Other
L Is this a hospital?
G Nature of trade or business _____________________________________
. . . . . .
If “Yes,” attach federal Schedule H (Form 990)
1
Unrelated business taxable income from Side 2, Part II, line 30
. . . .
. . . . . . . . . . . .
. •
00
Taxable
2
Multiply line 1 by the average apportionment percentage ________% from the Schedule R,
Corpora-
Apportionment Formula Worksheet, Part A, line 2 or Part B, line 5. See instructions
tion
3
Enter the lesser amount from line 1 or line 2. If the unrelated business activity is wholly in California
and Schedule R was not completed, enter the amount from line 1
4
Trust
5
Unrelated business taxable income from line 3 or line 4
6
EZ, LAMBRA, or TTA NOL carryover deduction . .
. . . . . . . . . . .
Tax
7
Net Operating Loss deduction. See General Information N
Computa-
8
Add line 6 and line 7
9
Net unrelated business taxable income. Subtract line 8 from line 5
10
Tax ________% x line 9. See General Information J
11
Tax credits from Schedule B. See instructions
Total
12
Balance. Subtract line 11 from line 10. If line 11 is greater than line 10, enter -0-
13
Alternative minimum tax. See General Information O
14
Total tax. Add line 12 and line 13 . . . .
15
. . . . . . . . . .Overpayment from a prior year allowed as a credit
16
. .2021 estimated tax payments. See instructions
Payments
17
Withholding (Form 592-B and/or 593). See instructions
18
Amount paid with extension (form FTB 3539)
19
Total payments and credits. Add line 15 through line 18
20
USE TAX. See instructions
Use Tax/
21
Payments balance. If line 19 is more than line 20, subtract line 20 from line 19
22
USE TAX BALANCE. If line 20 is more than line 19, subtract line 19 from line 20
Tax Due/
Overpay-
23
Tax due. Subtract line 21 from line 14. Pay entire amount with return. See instructions
ment
24
Overpayment. Subtract line 14 from line 21. See instructions
25
. . . . . . . . . .Enter amount of line 24 to be applied to 2022 estimated tax
3641213
Form 109 2021 Side 1
26
. . . . . . . . . . . . . . . . . . . . . . .Refund. If line 25 is less than line 24, then subtract line 25 from line 24
•. . .
. . •
. . . . . . . . .a Fill in the account information to have the refund directly deposited. Routing number
26a
b Type: Checking
•□
Savings
c Account Number
26c
Refund or
Amount
27
Penalties and interest. See General Information M
Due
28
• □ Check if estimate penalty computed using Exception B or C and attach form FTB 5806
29
Total amount due. Add line 22, line 23, line 25, and line 27, then subtract line 24
Unrelated Business Taxable Income
Part I
Unrelated Trade or Business Income
a
Gross receipts or gross sales______________ b Less returns and allowances______________ c Balance
• 1c
Cost of goods sold and/or operations (Schedule A, line 7)
Gross profit. Subtract line 2 from line 1c
Capital gain net income. See Specific Line Instructions – Trusts attach Schedule D (541)
• 4a
b
Net gain (loss) from Part II, Schedule D-1
• 4b
c
Capital loss deduction for trusts
• 4c
5Income (or loss) from partnerships, limited liability companies, or S corporations. See Specific Line Instructions.
Attach Schedule K-1 (565, 568, or 100S) or similar schedule
Rental income (Schedule C)
Unrelated debt-financed income (Schedule D)
Investment income of an R&TC Section 23701g, 23701i, or 23701n organization (Schedule E)
Interest, Annuities, Royalties and Rents from controlled organizations (Schedule F)
Exploited exempt activity income (Schedule G)
• 10
Advertising income (Schedule H, Part III, Column A)
• 11
Other income. Attach schedule
• 12
Total unrelated trade or business income. Add line 3 through line 12
• 13
Part II Deductions Not Taken Elsewhere (Except for contributions, deductions must be directly connected with the unrelated business income.)
Compensation of officers, directors, and trustees from Schedule I
. . . . . . . . . . . . . . . . . . . . .
Salaries and wages
Repairs
Bad debts
Interest. Attach schedule
Taxes. Attach schedule
Contributions. See instructions and attach schedule
a Depreciation (Corporations and Associations – Schedule J) (Trusts – form FTB 3885F)
21a
b Less: depreciation claimed on Schedule A. See instructions
21b
Depletion. Attach schedule
. . . . . . . . . . . . . . . . . . . . . .
a Contributions to deferred compensation plans
23a
b Employee benefit programs. See instructions
. . . . . . . . . . . . . . . . . . . . . ..
•. .
23b
Other deductions. Attach schedule
Total deductions. Add line 14 through line 24
Unrelated business taxable income before allowable excess advertising costs. Subtract line 25 from line 13
Excess advertising costs (Schedule H, Part III, Column B)
Unrelated business taxable income before specific deduction. Subtract line 27 from line 26
Specific deduction. See instructions
30
Unrelated business taxable income. Subtract line 29 from line 28. If line 28 is a loss, enter line 28
Our privacy notice can be found in annual tax booklets or online. Go to ftb.ca.gov/privacy to learn about our privacy policy statement, or go to ftb.ca.gov/forms and search for 1131 to locate FTB 1131 EN-SP, Franchise Tax Board Privacy Notice on Collection. To request this notice by mail, call 800.338.0505 and enter form code 948 when instructed.
Sign
Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and
Here
belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.
Title
Date
• Telephone
Signature
▶
of officer
Preparer’s
Check if self-
• PTIN
▶ □
Paid
signature
employed
• Firm’s FEIN
Firm’s name (or yours,
Use Only
if self-employed)
and address
May the FTB discuss this return with the preparer shown above? See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . • □ Yes □ No
Side 2 Form 109 2021
3642213
Schedule A Cost of Goods Sold and/or Operations.
Method of inventory valuation (specify)_______________________________________________
. . . . . . . . . . .Inventory at beginning of year
Purchases
Cost of labor
a Additional IRC Section 263A costs. Attach schedule
4a
b Other costs. Attach schedule
4b
Total. Add line 1 through line 4b
Inventory at end of year
Cost of goods sold and/or operations. Subtract line 6 from line 5. Enter here and on Side 2, Part I, line 2
Do the rules of IRC Section 263A (with respect to property produced or acquired for resale) apply to this organization? □ Yes □ No
Schedule B Tax Credits.
. . . . . . .Enter credit name__________________________code •__________
4Total. Add line 1 through line 3. If claiming more than 3 credits, enter the total of all claimed credits,
on line 4. Enter here and on Side 1, line 11
. . . . . . . . . . . . . . . . .
Schedule K Add-On Taxes or Recapture of Tax. See instructions.
Interest computation under the look-back method for completed long-term contracts. Attach form FTB 3834
. . . •
Interest on tax attributable to installment: a Sales of certain timeshares or residential lots.
. . . • 2a
b Method for non-dealer installment obligations
. . . • 2b
IRC Section 197(f)(9)(B)(ii) election to recognize gain on the disposition of intangibles
. . . . . . . . . . . . . . . .
Credit recapture. Credit name___________________________________________
Total. Combine the amounts on line 1 through line 4. See instructions
Schedule R Apportionment Formula Worksheet. Use only for unrelated trade or business amounts.
Part A.
Standard Method – Single-Sales Factor Formula. Complete this part only if the corporation uses the single-sales factor formula.
(a)
(b)
(c)
Total within and
Total within
Percent within
outside California
California
California [(b) ÷ (a)] x 100
Total sales
Apportionment percentage. Divide total sales column (b) by total sales column (a) and
multiply the result by 100. Enter the result here and on Form 109, Side 1, line 2
Part B.
Three Factor Formula. Complete this part only if the corporation uses the three-factor formula.
Property factor: See instructions
Payroll factor: Wages and other compensation of employees
Sales factor: Gross sales and/or receipts less returns and allowances
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .Total percentage: Add the percentages in column (c)
Average apportionment percentage: Divide the factor on line 4 by 3 and enter the
result here and on Form 109, Side 1, line 2. See instructions for exceptions.
Schedule C Rental Income from Real Property and Personal Property Leased with Real Property
For rental income from debt-financed property, use Schedule D, R&TC Section 23701g, Section 23701i, and Section 23701n organizations. See instructions for exceptions.
1Description of property
2 Rent received
3 Percentage of rent attributable
or accrued
to personal property
%
4 Complete if any item in column 3 is more than 50%, or for any item
5 Complete if any item in column 3 is more than 10%, but not more than 50%
if the rent is determined on the basis of profit or income
(a) Deductions directly connected
(b) Income includible, column 2
(a) Gross income reportable,
(b) Deductions directly connected with
(c) Net income includible, column 5(a)
(attach schedule)
less column 4(a)
column 2 x column 3
personal property (attach schedule)
less column 5(b)
Add columns 4(b) and column 5(c). Enter here and on Side 2, Part I, line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3643213
Form 109 2021 Side 3
Schedule D Unrelated Debt-Financed Income
1 Description of debt-financed property
2 Gross income from or
Deductions directly connected with or allocable to debt-financed property
allocable to debt-financed
Straight-line depreciation
(b) Other deductions
property
4 Amount of average acquisition
5 Average adjusted basis of or
6 Debt basis
7 Gross income reportable,
8 Allocable deductions,
9 Net income (or loss) includible,
indebtedness on or allocable
percentage,
column 2 x column 6
total of columns 3(a) and
column 7 less column 8
to debt-financed property
property (attach schedule)
column 4 ÷
3(b) x column 6
column 5
Total. Enter here and on Side 2, Part I, line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule E Investment Income of an R&TC Section 23701g, Section 23701i, or Section 23701n Organization
1 Description
2 Amount
3 Deductions directly connected
4 Net investment income,
5 Set-asides
6 Balance of investment income,
column 2 less column 3
column 4 less column 5
Total. Enter here and on Side 2, Part I, line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Enter gross income from members (dues, fees, charges, or similar amounts). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule F Interest, Annuities, Royalties and Rents from Controlled Organizations
Exempt Controlled Organizations
Name of controlled organizations
2 Employer
Net unrelated income
4 Total of specified
5 Part of column (4) that is
6 Deductions directly
identification
(loss)
payments made
included in the controlling
connected with income in
number
organization’s gross
column (5)
income
Nonexempt Controlled Organizations
Taxable income
9 Total of specified payments
10 Part of column (9) that is
11 Deductions directly
made
column (10)
Add columns 5 and 10
. . . . . . . . . . . . . . . . . . . . . . . .
Add columns 6 and 11
. . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . .
6 Subtract line 5 from line 4. Enter here and on Side 2, Part I, line 9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule G Exploited Exempt Activity Income, other than Advertising Income
1Description of exploited activity (attach schedule if more than one unrelated activity is exploiting the same exempt activity)
2 Gross unrelated
3 Expenses directly
business income
connected with
from trade or
production
business
of unrelated
4Net income from unrelated trade or business, column 2 less column 3
5Gross income from activity that is not unrelated business income
6Expenses attributable to column 5
7Excess exempt expense, column 6 less column 5 but not more than column 4
8Net income includible, column 4 less column 7 but not less than zero
Total. Enter here and on Side 2, line 10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Side 4 Form 109 2021
3644213
Schedule H Advertising Income and Excess Advertising Costs
Part I Income from Periodicals Reported on a Consolidated Basis
1 Name of periodical
2 Gross
3 Direct
4 Advertising income
5 Circulation
6 Readership
7 If column 5 is greater than
advertising
or excess advertising
costs
column 6, enter the income
costs. If column 2 is
shown in column 4, in
greater than column 3,
Part III, column A(b). If
complete columns 5,
column 6 is greater than
6, and 7. If column 3
column 5, subtract the sum
is greater than
of column 6 and column 3
column 2, enter the
from the sum of column 5
excess in Part III,
and column 2. Enter amount
column B(b). Do not
in Part III, column A(b). If the
amount is less than zero,
6, and 7.
enter -0-.
Totals . . . . . . . . . . . . . . . . . . .
Part II
Income from Periodicals Reported on a Separate Basis
enter
0 .
Part III
Column A – Net Advertising Income
Part III Column B – Excess Advertising Costs
(a) Enter “consolidated periodical” and/or
(b) Enter total amount from Part I, columns 4 or 7,
Enter total amount from Part I, column 4,
names of non-consolidated periodicals
and amount listed in Part II, columns 4 or 7
and amounts listed in Part II, column 4
Enter total here and on Side 2, Part I, line 11
Enter total here and on Side 2, Part II, line 27
Schedule I
Compensation of Officers, Directors, and
Trustees
1 Name of officer
2 SSN or ITIN
3 Title
4 Percent of time devoted
5 Compensation attributable
6 Expense account allowances
to business
to unrelated business
Total. Enter here and on Side 2, Part II, line 14
Schedule J
Depreciation (Corporations and Associations only. Trusts use form FTB 3885F.)
1 Group and guideline class or description
2 Date acquired (dd/mm/yyyy)
3 Cost or other basis
4 Depreciation allowed
Method of computing
6 Life or rate
7 Depreciation for
of property
or allowable in prior
depreciation
this year
years
1 Total additional first-year depreciation (do not include in items below)
2Other depreciation:
Buildings . . . . . . . . . . . . . . . . . . . .
Furniture and fixtures . . . . . . . . . . .
Transportation equipment . . . . . . .
Machinery and other equipment. . .
Other (specify)________________
___________________________
3 Other depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5 Amount of depreciation claimed elsewhere on return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6 Balance. Subtract line 5 from line 4. Enter here and on Side 2, Part II, line 21a. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3645213
Form 109 2021 Side 5
California 3522 - All LLCs registered or doing business in California are required to pay the $800 annual tax.
California 3500 - The form addresses the need for information on shared facilities, property transactions, and compensation beyond board membership.