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Screen CAD - California Capital Gains and Losses (1120)
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Overview
Use this screen to complete Schedule D for Form 100, 100W, or 100S, Form 3726, Deferred Intercompany Stock Account (DISA) and Capital Gains Information, and to complete other Schedule D-1 information. Also use this screen for Settlement Funds returns on Schedule D of Form 541.
Capital Gains and Losses
Detail schedule
Use the statement to enter information for the sale of capital assets not sold on installment. The application transfers the description, date purchased, date sold, and proceeds from the federal Schedule D to this statement. If the California cost / basis is different from the federal cost / basis, enter the state basis in the
CA Basis Force
column in the statement attached to these boxes. The application defaults to the federal cost / basis amount if you leave CA Basis Force
blank.note
When filing a return electronically, only the 1st 20 characters of the description shown on Schedule D are reported.
The application determines long-term or short-term status of an asset based on the dates entered for
Date Acquired
and Date Sold
in the statement. If the dates are blank, the application defaults to short-term status. Enter I
for Date Acquired
to designate an asset as inherited; the application treats this as a long-term holding period. Enter V
for Date Acquired
or Date Sold
to print the word "Various" for the date on the return. The application treats this as a short-term holding period. To report worthless securities on Schedule D, enter W
for Date Sold
and then enter Cost or Basis
. The application prints the word "Worthless" for the date sold and treats this as a short-term holding period.To override the treatment of the sale, select a code from the dropdown or from the
Force
column in the statement. For S Corporations, code 3
is provided for consistency with federal code 3
, which indicates that an asset is a collectible. The application treats this as a long-term asset, as if it were coded 2
. Also for S Corporations, codes 4, 5
, and 6
are provided for consistency with the same federal codes. IRC Section 1202 treatment in R&TC Sections 18038.5 and 18152.5 has been ruled unconstitutional. These transactions are reported as long-term capital gain rather than as other income on Schedules K and K-1 of Form 100S, as if they were coded 2
.In the statement for S Corporations, enter
1
or 2
for Rate
to indicate the capital gains tax rate. Enter 1
or leave it blank for a 1.5 percent capital gains tax rate. Enter 2
for an 8.84 percent capital gains tax rate.Type:
For S Corporations, an entry of 1
or 2
transfers the gain or loss to Schedule K, Other income. If you leave Type
blank, the transaction defaults to portfolio and transfers the gain or loss to Schedule K, Net short-term capital gain (loss) or Net long-term capital gain (loss).For C Corporations, if you leave
Type
blank, the transaction defaults to portfolio.Deferred Intercompany Stock Account (DISA) (C Corp)
The application uses the information entered in this section to complete Form 3726, and transfers taxable gains to Schedule D.
Prior year DISA detail (Enter percentage as xx.xxxx)
Use the statement to enter information about prior-year DISA transactions that this corporation received. For any which have resulted in a sale this year, enter the appropriate information. The application calculates the gain on the transaction and reports it on Form 3726 and Schedule D of Form 100 or 100W in the combined return that this member belongs to. Any DISA items remaining at year end will proforma to next year.
Current year DISA detail
Use the statement to enter information about new DISA distributions that the corporation received this year. The application reports these on Form 3726 in the combined return that this member belongs to, and will proforma this information to next year.
Built-In Gains (S Corp)
The application uses the information entered in this section to complete Schedule D, Part III for Form 100S. Use this section to enter California Built-In Gains information.
note
Also see the CAOthTax screen in the Taxes folder for additional S Corporation information.
Ordinary income: Recognized Built-In Gain (Loss)
In the statement, enter the information needed to calculate the current-year recognized built-in gain on the sale of ordinary income assets. The application calculates the amount of recognized built-in gain or loss on each asset entered in the statement. The built-in gains tax allocated to ordinary income items transfers to the Tax from Schedule D (100S) line on Form 100S, Page 1.
Recognized Built-In Gain Carryover
Enter the amount of recognized built-in gain carryover from the prior year. The application includes these amounts when calculating the current-year recognized built-in gain (loss). The application proformas the amount of recognized built-in gain carryover in the following year.
Were assets acquired in a Section 1374(d)(8) transaction?
Enter
1
if the S Corporation acquired transferred (substituted) basis property from a C Corporation, the property was owned by the S Corporation less than ten years, and the property was disposed of during the current tax year. A separate built-in gain tax recognition period applies to transferred basis assets. The recognition period is measured from the date the property is acquired by the S Corporation rather than the date of election of S Corporation status.Code
1
should also be entered here if the S Corporation acquired property from another S Corporation that is subject to the built-in gains tax, and the built-in gain recognition period for that asset hasn’t yet ended. The recognition period is the remainder of the original recognition period during which the transferor S Corporation was subject to the built-in gains tax with respect to that property.Enter
2
if the S Corporation hasn’t acquired transferred basis property from a C Corporation, or from an S Corporation that is subject to the built-in gains tax.The application continues to calculate any built-in gain carryover when code
1
is entered here, and the S Corporation’s recognition period has been met. The application doesn’t calculate any carryover when code 2
is entered here, and the S Corporation’s built-in gain recognition period has been met.