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Changes to 2006 Form

2006 Updates to Form 3805Q Instructions

Revision Date: 4/5/2007

Revision Details: Under Section 24347.5(b)(1) a disaster loss is carried forward for five taxable years following the year for which the loss is claimed. If there is additional disaster loss carryover after that five-year period then it may be carried forward for 10 additional years. Codes 3, 4, and 5 are expired because the 15-year carryover period has expired. Code 6 expired for corporations that elect to deduct the disaster loss in the prior year under IRC Section 165(i). For those corporations that did not elect to make an IRC 165(i) election, the disaster loss will expire this year. We added a new note to explain this, see the double asterisks"**" explanation. Code 16 followed the normal NOL rules and is expired.

FTB 3805Q Instructions, Page 3; Form 100 Booklet, Page 40; and Page 82 of the Package X.

  • Page 3, column 2, Designated Disasters, codes 3, 4, 5, 6, and 16

It should read:

1996 16 Firestorms 96(expired)* 1991 6 Oakland/Berkeley fire and other related casulties(expired)**
1990 5 Santa Barbara fires and other related casulties(expired)
1989 4 Bay Area earthquakes and other related casulties(expired)
1987 3 Forest fires, October earthquake, and other related casulties(expired)

  • Page 3, column 2, After the sentence with one asterisk

It should read:

**Corporations that elect to deduct the disaster loss in the prior year under IRC Section 165(i), the disaster loss carryover expires this year. Corporations that did not elect IRC Section 165(i), the disaster loss carryover expires next year.

This change will have an impact to tax liability because corporations can no longer claim the expired NOL's on the 2006 tax returns.

The revised internet version is available for download.

Back to Tax Form Changes for 2006