CA Form 3831 - Homeless Hiring Tax Credit
The California Homeless Hiring Tax Credit (HHTC) is designed to encourage employers to hire individuals who are homeless or have received supportive services from a homeless services provider. This credit is available to qualified taxpayers who hire eligible individuals and receive a tentative credit reservation for them.
Eligibility and Purpose
- Qualified Taxpayer: Must be an eligible employer that pays wages equal to or greater than 120% of the California minimum wage, subject to withholding under Division 6 of the Unemployment Insurance Code.
- Eligible Individual: Must be certified as homeless or have received supportive services from a homeless services provider, as defined under R&TC Section 17053.80 and 23629.
- Purpose: To provide a tax credit to employers who hire eligible individuals, promoting employment opportunities for the homeless population.
How to Claim the Credit
- Complete Form FTB 3831, Homeless Hiring Tax Credit, and attach it to your California tax return.
- For pass-through entities (S corporations, partnerships, LLCs classified as partnerships, estates, trusts), report the credit on Schedule K-1 (1008S, 541, 565, or 568).
- Use Worksheet 1 to calculate the total credit based on hours worked by each eligible individual. The credit per individual ranges from $2,500 to $10,000, with a maximum of $30,000 per taxable year.
- Ensure you have obtained a tentative credit reservation and a copy of the HHTC certificate for each eligible individual.
Important Notes
- The credit cannot reduce your regular tax below the tentative minimum tax or other applicable taxes (e.g., alternative minimum tax, built-in gains tax).
- Credits not used in the current year may be carried over, with the carryover period extended by the number of years the credit was not allowed.
- S corporations may not elect to make credits taken at the entity level refundable.
- Corporations within a combined reporting group may assign credits using Form FTB 3544, Part A.
Reporting and Filing
- Attach Form FTB 3831 to Form 1008 (S Corporation), Form 541 (Fiduciary), Form 565 (Partnership), or Form 568 (LLC).
- Enter the total credit claimed on Part I, line 1 of Form FTB 3831 and on your California tax return using credit code 244.
- For software users: Navigate to State > Start or Revisit California State > Other Credits > Start or Edit Form 3831.
Source:
Form FTB 3831 - Homeless Hiring Tax Credit
Disclaimer: Always verify details with official forms and instructions from the California Franchise Tax Board (FTB) or your state Department of Revenue. OLT (Online Taxes) provides guidance based on retrieved information but does not guarantee accuracy for all individual circumstances.