CA Form 3592 - College Access Tax Credit

CA Form 3592 - College Access Tax Credit

The California College Access Tax Credit (CATC) is designed to support educational funding by allowing eligible taxpayers to claim a credit based on contributions to the CATC Fund. This credit is administered by the California Educational Facilities Authority (CEFA) and is available for taxable years beginning on or after January 1, 2017, and before January 1, 2028.

Key Features of the College Access Tax Credit

• Credit Amount: The credit equals 50% of the amount contributed by the taxpayer to the CATC Fund for the taxable year.
• Annual Limit: The total amount CEFA can allocate annually is $500 million.
• Eligibility: Available to entities awarded the credit by CEFA, including corporations, S corporations, partnerships, trusts, and LLCs classified as partnerships.
• Pass-Through Credits: Entities such as S corporations, partnerships, and LLCs must use Form 3592 to pass through credits to shareholders, partners, or members.

How to Claim the Credit

Use Form FTB 3592 to report the credit amount earned and claimed for the current year and any carryover to future years. The form includes the following key lines:

• Line 1a: Enter the credit amount issued by CEFA for the current year.
• Line 2: Report pass-through credits received from S corporations, estates, trusts, partnerships, or LLCs. Attach a schedule listing entity details if multiple credits are received.
• Line 3: Total current year credit (sum of lines 1a and 2).
• Line 4: Credit carryover from prior years.
• Line 5: Total available credit (sum of lines 3 and 4).
• Line 6a: Credit claimed on the current year tax return.
• Line 6b: Total credit assigned (for corporations assigning credit within a combined reporting group).
• Line 6c: Credit amount elected to be refundable in future years (subject to $5,000,000 limitation).
• Line 7: Credit carryover available for future years (calculated by subtracting lines 6a, 6b, and 6c from line 5).

Important Notes

• The credit is not refundable unless an irrevocable election is made under Form FTB 3870.
• Taxpayers may elect to receive a refundable credit over a five-year period, claiming 20% annually starting in the third year after the election.
• Credits disallowed due to the $5,000,000 limitation may be carried forward. The carryover period extends by the number of years the credit was not allowed.
• The credit cannot reduce minimum franchise tax, annual tax, alternative minimum tax (AMT), built-in gains tax, or excess net passive income tax.

Filing Instructions

To add Form 3592 in Online Taxes software:

1. Navigate to your tax return and select "State" from the left menu (or tap three dots on mobile).
2. Select "Start or Revisit California State."
3. Under "Other Credits," click "Start or Edit" near Form 3592.
4. Follow on-screen instructions to complete the form.

Note: For SMLLCs (single-member LLCs not recognized by California), the credit is limited to the difference between regular tax with and without the disregarded entity’s income.

Source:

Form 3592 - College Access Tax Credit

Disclaimer: Always verify details with official Federal or State Department of Revenue Forms and Instructions.