Changes to 2011 Forms
Updates to the Form 109 on 07/03/2012 –– Exempt Organization Business Income Tax Return
We replaced text on Side 1, Line 3.
3 Enter the lesser amount from line 1 or line 2. If line 2 is zero, enter the amount from line 1.
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.
Reason for the changes
The language on line 3 intended to say taxpayers that are wholly in California and did not complete Schedule R, should enter the line 1 amount on line 3. However, the language did not reflect that intent.
This change reduces the tax liability for taxpayers who have a 0% apportionment factor.