California Research Credit

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Research Credit
2025 California Form 3523 Research CreditTAXABLE YEAR

2025

CALIFORNIA FORM

3523

Research Credit

Attach to your California tax return.

◻ SSN or ITIN  ◻ CA Corporation no.   ◻ FEIN

Name(s) as shown on your California tax return

California Secretary of State file number

Part I  Credit Computation. Read the instructions before completing this form.
Section A  Regular Credit. If you are electing the Alternative Simplified Credit, skip this section and go to Section B.
Line 1 through line 4 are to be completed only by corporations (other than S corporations, personal holding companies, and service organizations).
Individuals, S corporations, estates, trusts, partnerships, and limited liability companies (LLCs), begin on line 5.
 1	 Basic research payments paid or incurred during the taxable year. See instructions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	1			
00	

 2	 Base period amount. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 2	 		
00	

 3	 Subtract line 2 from line 1. If less than zero, enter -0-  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 3	 		
00	

 4	 Multiply line 3 by 24% (.24)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 4	 		
00	

	

Qualified research expenses paid or incurred.

 5	 Wages for qualified services. See instructions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 5	 		
00	

 6	 Cost of supplies. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 6	 		
00	

 7	 Rental or lease costs of computers. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 7	 		
00	

 8	 Enter the applicable percentage of contract research expenses. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 8	 		
00	

 9	 Total qualified research expenses. Add line 5 through line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 9	 		
00	

10	 Enter fixed-base percentage, but not more than 16% (.16). See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 10	 		%	

11	 Enter average annual gross receipts. See instructions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 11	 	

	00	

12	 Base amount. Multiply line 11 by the percentage on line 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	12	 		
00	

13	 Subtract line 12 from line 9. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	13	 		
00	

14	 Multiply line 9 by 50% (.50). See instructions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	14	 		
00	

15	 Enter the smaller of line 13 or line 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	15	 		
00	

16	 Multiply line 15 by 15% (.15)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	16	 		
00	
17	 a	 Regular credit. Add line 4 and line 16. If you do not elect the reduced credit under IRC Section 280C(c), enter the
result here, and see instructions for the schedule to attach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
	 b	 Reduced regular credit under IRC Section 280C(c). Multiply line 17a by the applicable percentage below:
		
•	 87.7% (.877) for individuals, estates, and trusts
	 	•	 91.16% (.9116) for corporations
		
•	 98.5% (.985) for S corporations
		 Enter the reduced credit amount. See instructions.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

For Privacy Notice, get FTB 1131 EN-SP.

7311253

	 17a	 		
00	

	 17b	 		
00	

FTB 3523  2025  Side 1

Section B  Alternative Simplified Credit. Skip this section if you completed Section A, Regular Credit.
Line 18 through line 21 are to be completed only by corporations (other than S corporations, personal holding companies, and service organizations).
Individuals, S corporations, estates, trusts, partnerships, and LLCs, begin on line 22.
18	 Basic research payments paid or incurred during the taxable year. See instructions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  18	 		00	
19	 Base period amount. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  19	 		
00	
20	 Subtract line 19 from line 18. If less than zero, enter -0-  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  20	 		
00	
21	 Multiply line 20 by 24% (.24)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 21	 		
00	
	

Qualified research expenses paid or incurred.

22	
23	
24	
25	
26	
27	

Wages for qualified services. See instructions  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 22	 		
00	
Cost of supplies. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 23	 		
00	
Rental or lease costs of computers. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 24	 		
00	
Enter the applicable percentage of contract research expenses. See instructions.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 25	 		
00	
Total qualified research expenses. Add line 22 through line 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 26	 		
00	
Enter the total qualified research expenses for the prior 3 taxable years. If there are no QREs in
any 1 of those years, skip lines 28 and 29. See instructions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	 27	 		
00	
28	 Divide line 27 by 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	28	 		
00	
29	 Subtract line 28 from line 26. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	29	 		
00	
30	 Multiply line 29 by 3% (.03) If you skipped lines 28 and 29, multiply line 26 by 1.3% (0.013)  . . . . . . . . . . . . . . . . . . . . . . . . . 	30	 		
00	
31	 a	 Alternative simplified credit. Add lines 21 and 30. If you do not elect the reduced credit
under IRC Section 280C(c), enter the result here, and see instructions for the schedule that must be attached  . . . . . . . 	 31a	 		
00	
	 b	 Reduced alternative simplified credit under IRC Section 280C(c). Multiply line 31a by the applicable percentage below:
		
•	 87.7% (.877) for individuals, estates, and trusts
		
•	 91.16% (.9116) for corporations
		
•	 98.5% (.985) for S corporations
		 Enter the reduced credit amount. See instructions.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
31b	 	
00
Section C  Available Research Credit
32	 Pass-through research credit(s) from S corporations, estates, trusts, partnerships, and LLCs. See instructions . . . . . . . . .
32	
33	 Current year research credit. If you did not elect the reduced credit under IRC Section 280C(c), add line 17a or
line 31a to line 32 and enter the result here. If you elected the reduced credit under IRC Section 280C(c),
add line 17b or line 31b to line 32 and enter the result here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
33	
34	 Enter the amount of credit on line 33 that is from passive activities. If none of the amount on line 33 is from
passive activities, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	34	
35	 Subtract line 34 from line 33 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	35	
36	 Enter the allowable credit from passive activities. See instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	36	
37	 Non-passive activity credit carryover from prior year. (Do not include credits received through assignment.)
See instructions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
37	
38	 Total. Add line 35 through line 37 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
38	

	
	

		
00	

		
00	

		
00	
		
00	
		
00	

		
00	
		
00	

Part II  Carryover Computation. Combined Report Filers see instructions for Part III before completing this part.
39	 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.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 39	 		
00	

40	 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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

	 40	 		
00	

41	 Credit amount to be elected as refundable in future years. See instructions.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 	41	 		
00	
42	 Credit carryover available for use or assignment for future years. Subtract lines 39, 40, and 41 from line 38 . . . . . . . . . . .

Side 2  FTB 3523  2025

7312253

	 42	 		
00	

Part III  Credit Allocation and Carryover Per Entity – Only Combined Report Filers
To make an election for assigning credits, you must also complete form FTB 3544, Part A. Otherwise, the assignment indicated here will be invalid.
Credit Generated and Assigned Per Entity
(a)
Corporation

(b)
Corporation no., FEIN, or
SOS no.

(c)
Amount of credit generated
in current year

(f)
Amount of credit from col. (e) claimed
in current year return. (Do not include
any assigned credit claimed on
form FTB 3544, Part B.)

(g)
Amount of research credit
assigned and to be reported
on form FTB 3544, Part A

(h)*
Generated credit carryover
for future years
col. (e) – [col. (f) + col. (g)]

(d)
Amount of generated credit
carryover from prior years

(e)
Total of generated credit
and credit carryover from
prior years
col. (c) + col. (d)

1
2
3
4
5
6
7
Total

1
2
3
4
5
6
7
Total
*If the taxpayer elects to make credits that were disallowed due to the $5,000,000 limitation refundable, do not include the credit amount elected to be refundable
in column (h). To make an election for refundable credits, you must complete form FTB 3870. Get form FTB 3870 for more information.

7313253

FTB 3523  2025  Side 3

Extracted from PDF file 2025-california-form-3523.pdf, last modified December 2025

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More about the California Form 3523 Corporate Income Tax Tax Credit TY 2025

It is required for you to attach this form with your California tax return. This form contains areas for you to fill out relating to credit computation, carryover computation, and credit allocation and carryover per entity filled out.

We last updated the Research Credit in February 2026, so this is the latest version of Form 3523, fully updated for tax year 2025. You can download or print current or past-year PDFs of Form 3523 directly from TaxFormFinder. You can print other California tax forms here.

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Other California Corporate Income Tax Forms:

TaxFormFinder has an additional 174 California income tax forms that you may need, plus all federal income tax forms.

Form Code	Form Name
3805-Z Booklet	Enterprise Zone Business Booklet
Form 100-ES	Corporation Estimated Tax Estimated
Form 3536	Estimated Fee for LLCs Estimated
Form 541-ES Form	Estimated Tax for Fiduciaries Estimated
Form 568	Limited Liability Company Return of Income

Download all CA tax forms View all 175 California Income Tax Forms

Form Sources:

California usually releases forms for the current tax year between January and April. We last updated California Form 3523 from the Franchise Tax Board in February 2026.

Show Sources >

Form 3523 is a California Corporate Income Tax form. States often have dozens of even hundreds of various tax credits, which, unlike deductions, provide a dollar-for-dollar reduction of tax liability. Some common tax credits apply to many taxpayers, while others only apply to extremely specific situations. In most cases, you will have to provide evidence to show that you are eligible for the tax credit, and calculate the amount of the credit to which you are entitled.

About the Corporate Income Tax

The IRS and most states require corporations to file an income tax return, with the exact filing requirements depending on the type of company.

Sole proprietorships or disregarded entities like LLCs are filed on Schedule C (or the state equivalent) of the owner's personal income tax return, flow-through entities like S Corporations or Partnerships are generally required to file an informational return equivilent to the IRS Form 1120S or Form 1065, and full corporations must file the equivalent of federal Form 1120 (and, unlike flow-through corporations, are often subject to a corporate tax liability).

Additional forms are available for a wide variety of specific entities and transactions including fiduciaries, nonprofits, and companies involved in other specific types of business.

Historical Past-Year Versions of California Form 3523

We have a total of fourteen past-year versions of Form 3523 in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:

2025 Form 3523

2025 California Form 3523 Research Credit

2023 Form 3523

2023 Form 3523 Research Credit

2022 Form 3523

2022 California Form 3523 Research Credit

2021 Form 3523

2021 California Form 3523 Research Credit

2020 Form 3523

2020 Form 3523 Research Credit

2019 Form 3523

2019 California Form 3523 Research Credit

2018 Form 3523

2018 Form 3523 - Research Credit

2017 Form 3523

2017 California Form 3523 Research Credit

2016 Form 3523

2016 Form 3523 Research Credit

2015 Form 3523

2015 Form 3523 -- Research Credit

2014 Form 3523

2014 Form 3523 -- Research Credit

2013 Form 3523

2013 Form 3523 -- Research Credit

2012 Form 3523

2012 Form 3523

2011 Form 3523

2011 Form 3523 -- Research Credit

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