Preparing California S Corporation consolidated returns when the state and federal groups are the same

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Use this procedure to ensure the correct preparation of the California S Corporation consolidated income tax return if the members of the California group are the same as those included in the federal S Corporation consolidated group and there is not a federal eliminations client.

  1. Add California to the parent client and all subsidiary clients. Complete all data entry for these member clients. Each member's state return should be complete and correct before proceeding to the next step.

    Note: Apportionment data entry must be completed for each member client, even if the client is 100 percent in-state. Apportionment data entry is accessed through View > Apportionment.

  2. Add California to the federal S Corporation consolidated client.

    Note: When adding California to an S Corporation consolidated federal client, the state automatically defaults to being a consolidated return.

    If the state is added as an S Corporation to a federal consolidated group, the combined functionality does not take place. The amounts from each member are not consolidated.

  3. Review all California consolidated client input screens and complete any necessary remaining data entry. For each Category not marked in the File > Client Properties > Advanced Properties > Options dialog, enter the necessary data in the applicable input screens.

    Note: If a category is not marked, enter the data on the applicable input screens in the consolidated client. For a list of categories and related input screens, see Categories and related California input screens.

    Any changes made to the File > Client Properties > Advanced Properties > Options dialog affect both the federal and state return.

  4. To make manual adjustments in other areas of the return, click the Group View button or press F7 in the input screen field you want to adjust, and then enter the adjustment amount in the Group View dialog.
  5. To change amounts entered in the California parent or subsidiary clients, go back to the original source of data entry. For instance, if you made a mistake when you entered the apportionment of the first subsidiary, close the consolidated client and reopen the first subsidiary. Choose View > Apportionment for that client and correct the data. Close the subsidiary client and reopen the consolidated client. The correct amount is now a part of the combined Group return.
  6. Print and review the California S Corporation consolidated tax return.

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