TAX NEWS - 2010

California corporate tax loopholes

California's upcoming ballot initiative – Repeal corporate tax loopholes

The California Secretary of State recently announced that an initiative entitled the "Repeal Corporate Tax Loopholes Act" (the "Initiative") sponsored by the California Teachers Union garnered enough support to qualify for the November 2010 ballot. If the Initiative passes, it would repeal the following California corporate franchise tax provisions that were enacted in two prior-year budget sessions:

- The single sales factor election
- Assignment of credits between members of the same combined reporting group
- Carryback of net operating losses (NOLs)
- 20-year carryforward of NOLs (thus reinstating the 10-year carryforward)