1040-CA ELF: Electronic filing business rules and resolutions

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To learn how to address specific California electronic filing business rules, click a business rule in the following table. Note that there may be more than one reason that a specific business rule generates.

Business rule Potential message
F3801-010 Business Rule F3801-010 / Rejected;If Form 3801, Side 2, Line 1d [TotalFederalNetIncomeLoss] amount is significant, then amount must equal Schedule CA (540 or 540NR), Line 12, column (a) [Business Income]. (value TotalFederalNetIncomeLoss amount is xxxxx. Business Income amount is 0. , rule F3801-010)/CA-Return/CA-ReturnData/CAForm3801/CAActivityWorksheets/ScheduleEActivities/TotalFederalNetIncomeLoss: ;;SubID=xxxxxxxxxxxxxxxx

Description of Business Rule F3801-010

The California Franchise Tax Board (FTB) expects Schedule CA(540) to print if Form 3801 prints. This is contrary to the instructions, which state that you should print Schedule CA(540) only if there are differences to amounts due to differences between federal law and California law. We added a print condition for Schedule CA(540) for UltraTax/1040-CA, version 12.3.0 to print Schedule CA when Form 3801 prints regardless of whether there are amounts on the return that differ between federal law and California law.

Resolution: Force both pages of Schedule CA(540) or Schedule CA(540NR) to print.

Note: Form 3801 reconciles amounts under California law with amounts under federal law. The federal amount of Business Income from Form 3801, Page 2, line 1d should match Schedule CA(540), line 12A.

F3801-020 Business Rule F3801-020 / Rejected;If Form 3801, Side 2, Line 2d [TotalFederalNetIncomeLoss] amount is significant, then amount must equal Schedule CA (540 or 540NR), Line 17, column (a) [Rents]. (value TotalFederalNetIncomeLoss amount is xxxxx. Rents amount is 0. , rule F3801-020)/CA-Return/CA-ReturnData/CAForm3801/CAActivityWorksheets/ScheduleEActivities/TotalFederalNetIncomeLoss: ;;SubID=xxxxxxxxxxxxxxxx

Description of Business Rule F3801-020

The California Franchise Tax Board (FTB) expects Schedule CA(540) to print if Form 3801 prints. This is contrary to the instructions, which state that you should print Schedule CA(540) only if there are differences to amounts due to differences between federal law and California law. We added a print condition for Schedule CA(540) for UltraTax/1040-CA, version 12.3.0 to print Schedule CA when Form 3801 prints regardless of whether there are amounts on the return that differ between federal law and California law.

Resolution: Force both pages of Schedule CA(540) or Schedule CA(540NR) to print.

Note: Form 3801 reconciles amounts under California law with amounts under federal law. The federal amount of Rental Income from Form 3801, Page 2, line 2d should match Schedule CA(540), line 17a.

F3801-030 Business Rule F3801-030 / Rejected;If Form 3801, Side 2, Line 3d [TotalFederalNetIncomeLoss] amount is significant, then amount must equal Schedule CA (540 or 540NR), Line 18, column (a) [Farm Income]. (value TotalFederalNetIncomeLoss amount is xxxxx . Farm Income amount is 0. , rule F3801-030)/CA-Return/CA-ReturnData/CAForm3801/CAActivityWorksheets/ScheduleEActivities/TotalFederalNetIncomeLoss: ;;SubID=xxxxxxxxxxxxxxx

Description of Business Rule F3801-030

The California Franchise Tax Board expects Schedule CA(540) to print if Form 3801 prints. This is contrary to the instructions, which state that you should print Schedule CA(540) only if there are differences to amounts due to differences between federal law and California law. We added a print condition for Schedule CA(540) for UltraTax/1040-CA, version 12.3.0 to print Schedule CA when Form 3801 prints regardless of whether there are amounts on the return that differ between federal law and California law.

Resolution: Force both pages of Schedule CA(540) or Schedule CA(540NR) to print.

Note: Form 3801 reconciles amounts under California law with amounts under federal law. The federal amount of Farm Income from Form 3801, Page 2, line 3d should match Schedule CA(540), line 18A.

F540/NR/NRS/2EZ-170 or 180

CA-Return/CA-ReturnHeader/PrimarySignature/PriorYearAGI: Prior Year AGI [PriorYearAGI] in the Primary Taxpayer Signature [PrimarySignature] element does not match FTB's records, therefore you cannot sign your return electronically. You can still e-file by signing Form 8453-OL.

Description of Business Rule F540/NR/NRS/2EZ-170 or 180

When filing under the Self-Select PIN method, CA FTB does a cross check for AGI from the prior year return as originally filed. If the CA FTB records do not agree with the amount provided in the electronic record, the return will be rejected for Business Rule 170 or 180 (for spouse).

Resolution: There are two ways to resolve this:

  1. On Screen CAELF, mark the Suppress California use of PIN field in the Return PIN information section. No PIN information will be included in the electronic record; therefore California will not do a cross check of the prior year AGI. UltraTax CS will produce CA Form 8453 instead of CA Form 8879.
  2. Use the Practitioner PIN Method instead of Self-Select. For electronic returns created when the Practitioner PIN Program filer checkbox is marked, California FTB will also skip the cross check of prior year AGI and UltraTax CS still prints CA Form 8879.
F540 / NR-420

If Form 540/NR, Line 18 [CADeductions] is not equal to the standard deduction amount and Line 6 [ClaimedAsDependent] is checked 'No', then Line 18 [CADeductions] must equal Schedule CA (540 or 540NR), Line 43 [CAItemizedDeductions].

Description of Business Rule F540 / NR-420

Itemized deductions claimed on the main return, line 18, must be supported by an amount on Sch CA(540) or Sch CA(540NR), line 43. Unless there is an override, we would not expect users to encounter this rejection from FTB. UltraTax/1040-CA typically catches any discrepancies. If the return passes UltraTax CS e-file error checking but is rejected by the CA FTB, Schedule CA(540), Page 2 might have been omitted when the CA e-file was created. We have not been able to determine why this happens.

Resolution: Typically, re-creating the e-file corrects this business rule. Review the contents of the e-file in Electronic Filing Status dialog.

F540-650

Form 540, Line 64 [TotalTax] must equal the sum of Line 48 [TotalTaxAfterCredits] + Line 61 [AlternativeMinTax] + Line 62 [MentalHealthServicesTax] + Line 63 [OtherTaxesAndRecapture].

Description of Business Rule F540-650

This error code attempts to reconcile the components of Total Tax. Unless there is an override, we would not expect users to encounter this rejection from the CA FTB. UltraTax/1040-CA typically catches any discrepancies. If the return passes UltraTax CS e-file error checking but is rejected by the CA FTB, Form 540, Page 3 might have been omitted from the electronic record when the CA e-file was created. We have not been able to identify the circumstances under which this happens.

Resolution: Typically, re-creating the e-file corrects this business rule. Review the contents of the e-file in the Electronic Filing Status dialog.

F540-670

There is an error on Form 540, Line 71 [CAWithholding]. Line 71 [CAWithholding] must equal the total amounts withheld on all W-2, W-2G,1099-R forms and Other Withholding [OtherWithholding] Amounts [Amount] where: On Form W-2 'CA' is present in Line 15, [StateAbbreviationCd]. Withholding Amount Checked: Line 17, [StateIncomeTaxAmt ]. On Form W-2G 'CA' is present in Line 13, [StateAbbreviationCd]. Withholding Amount Checked: Line 15, [StateTaxWithheldAmt]. On Form 1099-R 'CA' is present in Line 13, [StateAbbreviationCd]. Withholding Amount Checked: Line 12, [StateTaxWithheldAmt]. Exception: The Filing Status [FilerStatus] is equal to Married/RDP Filing Separately [MarriedOrRDPFilingSeparately].

Description of Business Rule F540-670

This error code attempts to reconcile withholding on Form 540, line 71. Unless there is an override, we would not expect users to encounter this rejection from the CA FTB. UltraTax/1040-CA typically catches any discrepancies. If the return passes UltraTax e-file error checking but is rejected by the CA FTB, Form 540, Page 3 might have been omitted from the electronic record when the CA e-file was created. We have not been able to identify the circumstances under which this happens.

Resolution: Typically, re-creating the e-file corrects this business rule. Review the contents of the e-file in the Electronic Filing Status dialog.

F540-670, F540NR-670

Business Rule F540-670 / Rejected;There is an error on Form 540, Line 71 [CAWithholding]. Line 71 [CAWithholding] must equal the total amounts withheld on all W-2, W-2G,1099-R forms and Other Withholding [OtherWithholding] Amounts [Amount]

Business Rule F540NR-670Rejected;There is an error on Form 540NR, Line 81 [CAWithholding]. Line 81 [CAWithholding] must equal the total amounts withheld on all W-2, W-2G,1099-R forms and Other Withholding [OtherWithholding] Amounts [Amount]

Description of Business Rule F540-670, F540NR-670

The California Franchise Tax Board rejects the return if supporting documentation does not account for withholding on Form 540, line 71 or Form 540NR, line 81.

Resolution: Verify that all withholding documents have the payer Employer Identification Number (EIN), payer name, State ID number, and "CA" postal code. For sources of withholding other than W2, W2G, 1099R, use Screen CAOthWH to complete the applicable information, including the Alternate Form code, Payer EIN, Payer name, and CA withholding amounts. If the return was actually rejected by CA FTB, a key doucment, such as 1099-R, was probably omitted from the electronic record. Include the aforementioned information in the data entry and clear all Critical and ELF Critical diagnostics for 1040-Federal and 1040-CA.

F540-710 Business Rule F540-710 / Rejected;If Form 540, Line 74 [ExcessSDI] is significant, then Form W-2, Line 14 [TotalWithheld] must be significant on two or more W-2s for the same taxpayer. (value ExcessSDI amount is xxx. W-2 TotalWithheld amount count is 1., rule F540-710)/CA-Return/CA-ReturnData/CAForm540/Payments/ExcessSDI

Description of Business Rule F540-710

When a taxpayer (or spouse) has State Disabability Insurance (SDI) withholding from multiple employers and the total of that SDI withholding exceeds a certain threshold, the taxpayer can claim SDI credit for the excess withholding on the main return. However, the SDI withholding must be reflected properly in the W-2 portion of the electronic record. California Franchise Tax Board (FTB) Business Rule F540-710 suggests that this information belongs in the "Line 14" field in the W-2 portion of the California electronic record. In this case, the FTB is referring to the Disability Insurance field in the W-2 portion of the California electronic record.

Resolution: In UltraTax/1040, enter an amount with code 5 in Screen W2, Box 14 and then enter the CA postal code, or enter a California amount in Screen W2, Boxes 19 and 20. For Boxes 19 and 20, the SDI code is not as critical as the Name of locality field, which must be "State Dis." UltraTax CS automatically enters this information when you select SDI from the related fieldview. If the Box 20 entry is not "State Dis," the amount is included in the W-2 portion of the California electronic record as "local withholding," rather than Disability Insurance withholding. When the amount is reported as local withholding instead of SDI, the FTB cannot reconcile the amounts to support the SDI credit. Verify that you entered "State Dis" in Box 20 (Name of locality) in federal Screen W2 if you enter SDI in Boxes 19 and 20.

X0000-020 Rejected;Your Federal return does not match the latest published IRS Schema or is not well formed. (value File Name: submission.xml. Line Number: xxx. Position: xx. Reason...The Pattern constraint failed., rule X0000-020)

Description of Business Rule X0000-020

Even if the federal Form 1040 is not electronically filed, the 1040-CA electronic record includes a copy of the federal return. The California Franchise Tax Board (FTB) validates both the federal portion and the California portion of the electronic record. So, you must clear all federal schema errors (including PIN information) before you electronically file the CA Form 540/540NR return. UltraTax/1040-CA issues an FYI diagnostic message about this error.

Resolution: Whether the 1040-US return is actually being e-filed, the 1040-CA electronic record includes a copy of the federal return when required by the FTB. The California Franchise Tax Board actually validates both the federal portion and the CA portion of the electronic record. So, it is critical to clear all federal schema errors (including PIN information) before e-filing the CA Form 540/540NR return. 1040-CA issues an FYI diagnostic. For resolution information, see the "Federal Attachment to California Electronic Record" section of the 1040 California frequently asked questions. To access the frequently asked questions, press the F1 key from within any UltraTax/1040-CA input screen, and click the "Processing 1040 California returns and frequently asked questions" link at the end of the Overview section.

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