California ~ Corporate Income Tax: Qualified REIT Subsidiary Not Subject to Minimum Tax

A qualified real estate investment trust subsidiary (QREITS) is not subject to the California minimum franchise tax under Rev. & Tax. Code §23153, according to informal guidance from the California Franchise Tax Board. A QREITS and its parent real estate investment trust (REIT) are treated as a single tax entity for California tax purposes. In addition, because the QREITS is disregarded as a separate entity for California income tax purposes, its activities are the activities of its parent REIT for purposes of Rev. & Tax. Code §23101 (doing business). Thus, a QREITS’s parent REIT is subject to the minimum franchise tax, but the QREITS itself is not subject to the tax.

Legal Division Guidance 2011-06-02, California Franchise Tax Board, June 2011

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Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

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