California Disabled Access Credit for Eligible Small Businesses

Disabled Access Credit for Eligible Small Businesses
2023 FORM 3548 Disabled Access Credit for Eligible Small Businesses
TAXABLE YEAR

2023

Disabled Access Credit for Eligible
Small Businesses

CALIFORNIA FORM

3548

Attach to your California tax return.
Name(s) as shown on your California tax return

□ SSN or ITIN □ CA Corporation number □ FEIN

Address of facility (number and street)

California Secretary of State file number

City

State

1
2
3
4
5
6
7
8
9

Eligible access expenditures. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Maximum amount of eligible access expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Enter the smaller of line 1 or line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Current year credit. Multiply line 3 by 50% (.50). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Pass-through Disabled Access Credit(s) from Schedule K-1 (100S, 541, 565, or 568). See instructions. . . . . . . . . 5
Total current year Disabled Access Credit. Add line 4 and line 5, but do not enter more than $125 . . . . . . . . . . . . . 6
Credit carryover from prior year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Total available Disabled Access Credit. Add line 6 and line 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
a Credit claimed. Enter the amount of the credit claimed on the current year tax return. See instructions.
(Do not include any assigned credit claimed on form FTB 3544, Part B). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9a
9 b Total credit assigned. Enter the total amount from form FTB 3544, Part A, column (g).
If you are not a corporation, enter -0-. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9b
10 Credit carryover available for future years. Add line 9a and line 9b, subtract the result from line 8 . . . . . . . . . . . . . 10

General Information
California allows a Disabled Access Credit that is similar to the federal
Disabled Access Credit under Internal Revenue Code (IRC) Section 44,
with exceptions. Unless specifically identified otherwise, references
in these instructions are to the IRC as of January 1, 2015, and to
the California Revenue and Taxation Code (R&TC).

A

Purpose

Eligible small businesses use form FTB 3548, Disabled Access Credit for
Eligible Small Businesses, to figure a credit for expenditures to provide
access to disabled individuals. Also, use this form to claim pass-through
Disabled Access Credits received from S corporations, estates,
trusts, partnerships, or limited liability companies (LLCs) classified
as partnerships.
S corporations, estates, trusts, partnerships, and LLCs classified as
partnerships should complete form FTB 3548 to figure the amount of credit
to pass through to shareholders, beneficiaries, partners, or members.
Attach this form to Form 100S, California S Corporation Franchise or
Income Tax Return; Form 541, California Fiduciary Income Tax Return;
Form 565, Partnership Return of Income; or Form 568, Limited Liability
Company Return of Income. Show the pass-through credit for each
shareholder, beneficiary, partner, or member on Schedule K-1 (100S,
541, 565, or 568), Share of Income, Deductions, Credits, etc.

B

Description

The amount of California credit allowed to an eligible small business
is 50% (.50) of the qualified expenditures that do not exceed $250 per
taxable year. The maximum credit per eligible small business per taxable
year is $125.

C

California and Federal Differences

The federal Disabled Access Credit under IRC Section 44 and the
California Disabled Access Credit under R&TC Sections 17053.42
and 23642 are generally the same, except:
• California bases the credit on 50% (.50) of the eligible access
expenditures up to $250. Federal bases the credit on 50% (.50) of
For Privacy Notice, get FTB 1131 EN-SP.

ZIP code

$250

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the eligible access expenditures that exceed $250 up to a maximum
of $10,250.
• California allows a carryover of the credit until it is exhausted. The
federal credit is one of the general business credits subject to the
limitations imposed by IRC Section 38.

D

Qualifications

To qualify for the Disabled Access Credit, you must be an eligible small
business that complies with the federal Americans with Disabilities
Act of 1990 (Public Law 101-336) and pay or incur eligible access
expenditures for taxable years beginning on or after January 1, 1996.

E

Definitions

Eligible small business is any business or person that meets both of
the following requirements:
• Had gross receipts for the preceding taxable year that did not exceed
$1 million, or if gross receipts exceeded $1 million, employed no
more than 30 full-time employees during the preceding taxable year.
• Elects to claim the Disabled Access Credit for the taxable year by
filing form FTB 3548.
For purposes of the definition of an eligible small business:
• Gross receipts are reduced by returns and allowances made during
the taxable year.
• An employee is considered full-time if employed at least 30 hours per
week for 20 or more calendar weeks in the taxable year.
• Generally, all members of the same controlled group and all
persons under common control are considered to be one person.
See IRC Section 44(d)(2)(A).
Eligible access expenditures are the amounts the eligible small
business pays or incurs to comply with applicable requirements under
the Americans with Disabilities Act of 1990. Eligible access expenditures
include amounts paid or incurred to:
1. Remove architectural, communication, physical, or transportation
barriers that prevent a business from being accessible to, or usable
by individuals with disabilities, but only in connection with a facility
first placed in service before November 6, 1990 (the effective date of
the Americans with Disabilities Act of 1990).

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FTB 3548 2023 Side 1

2. Provide qualified interpreters or other methods of making audio
materials available to hearing-impaired individuals.
3. Provide qualified readers, taped texts, and other methods of making
visual materials available to individuals with visual impairments.
4. Acquire or modify equipment or devices for individuals with disabilities.
5. Provide other similar services, modifications, materials, or equipment.
The expenditures must be reasonable and necessary to accomplish the
above purposes. See IRC Section 44(c) for further details.
Disability for an individual (as defined by the Americans with Disabilities
Act of 1990) means:
1. A physical or mental impairment that substantially limits one or more
of the major life activities of that individual.
2. A record of an impairment described in 1 above, or
3. Being regarded as having an impairment described in 1 above.

F

Limitations

The amount of credit generated for any taxable year is limited to $125.
This limitation applies at the entity level (for S corporations) as well as
to each shareholder. S corporations may claim only 1/3 of the credit (not
to exceed $41.67) against the 1.5% entity-level tax (3.5% for financial
S corporations), the remaining 2/3 must be disregarded and may not be
used as carryover. S corporations can pass through 100% of the credit
(not to exceed the $125 limitation) to their shareholders.
If a C corporation had unused credit carryovers when it elected
S corporation status, the carryovers were reduced to 1/3 and transferred
to the S corporation. The remaining 2/3 were disregarded. The allowable
carryovers may be used to offset the 1.5% tax on net income in
accordance with the respective carryover rules. These C corporation
carryovers may not be passed through to shareholders. For more
information, get Schedule C (100S), S Corporation Tax Credits.
If a taxpayer owns an interest in a disregarded business entity [a single
member limited liability company (SMLLC) not recognized by California,
and for tax purposes is treated as a sole proprietorship owned by an
individual or a branch owned by a corporation], the credit amount
received from the disregarded entity that can be utilized is limited to the
difference between the taxpayer’s regular tax figured with the income of
the disregarded entity, and the taxpayer’s regular tax figured without the
income of the disregarded entity.
For more information on SMLLC, get form 568, Limited Liability
Company Tax Booklet.
If the disregarded entity reports a loss, the taxpayer may not claim the
credit this year but can carry over the credit amount received from the
disregarded entity to succeeding years.
This credit cannot reduce the minimum franchise tax (corporations and
S corporations), the annual tax (limited partnerships, limited liability
partnerships, and LLCs classified as partnerships), the alternative
minimum tax (corporations, exempt organizations, individuals, and
fiduciaries), the built-in gains tax (S corporations), or the excess net
passive income tax (S corporations).
This credit cannot reduce regular tax below the tentative minimum tax.
Get Schedule P (100, 100W, 540, 540NR, or 541), Alternative Minimum
Tax and Credit Limitations, for more information.
This credit is taken in lieu of any deduction or credit otherwise allowable
for the same eligible access expenditures. Any deduction allowed for
these same expenditures must be reduced by the amount of credit
claimed and/or assigned to an affiliated corporation for the current
taxable year (the amount shown on line 9a and 9b).
Taxpayers that claim this credit cannot increase the basis of the property,
with respect to the eligible access expenditures paid or incurred in
connection with such property, by the amount of credit claimed and/or
assigned to an affiliated corporation for the current taxable year (the
amount shown on line 9a and line 9b).
This credit is not refundable.

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FTB 3548 Instructions 2023

G

Assignment of Credits

Assigned Credits to Affiliated Corporations – Credit earned by
members of a combined reporting group may be assigned to an
affiliated corporation that is an eligible member of the same combined
reporting group. A credit assigned may only be claimed by the affiliated
corporation against its tax liability. For more information, get form
FTB 3544, Assignment of Credit, or go to ftb.ca.gov and search for
credit assignment.

H

Carryover

If the available credit exceeds the current year tax liability, the unused
credit can be carried over to succeeding years until exhausted. Apply the
carryover to the earliest taxable year. In no event can this credit be carried
back and applied against a prior year’s tax.

Specific Line Instructions
Line 1 – Eligible access expenditures
Enter the total eligible access expenditures paid or incurred during the
current taxable year.
Line 5 – Pass-through Disabled Access Credit
If you received more than one pass-through credit from S corporations,
estates, trusts, partnerships, or LLCs classified as partnerships, add the
amounts and enter the total. Attach a schedule showing the names and
identification numbers of the entities from which the credits were passed
through to you.
Line 9a – Credit claimed
Do not include assigned credits claimed on form FTB 3544, Part B, List
of Assigned Credit Received and/or Claimed by Assignee.
This amount may be less than the amount on line 8 if your credit
is limited by your tax liability. For more information, see General
Information F, Limitations, and refer to the credit instructions in your tax
booklet. Use credit code 205 when you claim this credit.
Line 9b – Total credit assigned
Corporations that assign credit to other corporations within the same
combined reporting group must complete form FTB 3544, Part A, Election
to Assign Credit Within Combined Reporting Group. Enter the total amount
of credit assigned from form FTB 3544, Part A, column (g) on this line.

Franchise Tax Board Privacy Notice on
Collection
Our privacy notice can be found in annual tax booklets or online.
Go to ftb.ca.gov/privacy to learn about our privacy policy statement, or
go to ftb.ca.gov/forms and search for 1131 to locate FTB 1131 EN-SP,
Franchise Tax Board Privacy Notice on Collection - Aviso de Privacidad
del Franchise Tax Board sobre la Recaudación. To request this notice by
mail, call 800.338.0505 and enter form code 948 when instructed.