FTB Provides Guidance to Dealers in Real Property for Calculating the LLC Fee

 

DeEtte L. Loeffler, J.D., L.LM, Taxation

The state Franchise Tax Board will be releasing updated guidance and instructions for form 568 answering the question: “Does the cost of goods sold include the adjusted basis of real property held for sale to customers in the ordinary course of business?” The answer is that the fee will include property held for sale to customers, but not property held for investment purposes. For a summary or this question and answer, see FTB https://www.ftb.ca.gov/professionals/taxnews/Editions/August-2016.shtml. For the complete ruling, see https://www.ftb.ca.gov/law/rulings/active/2016/01_07142016.pdf.

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