California Form FTB 3805V is the Net Operating Loss (NOL) Computation and NOL and Disaster Loss Limitations — Individuals, Estates, and Trusts form that California taxpayers use to figure, track, and carry over a state NOL or disaster loss when their deductions exceed their income. The California Franchise Tax Board requires this form any time you generate, claim, or carry forward a California NOL on Form 540, Form 540NR, Form 541, or a fiduciary return.
Because California does not fully conform to federal NOL rules under IRC §172, filing FTB 3805V is the only way the state can track your loss correctly. The FTB processed more than 1.2 million NOL-related schedules in the most recent reporting cycle, and the agency rejects or adjusts roughly 14% of them for math errors, missing carryover years, or wrong AGI thresholds. Getting this form right protects deductions worth thousands of dollars.
Here is what this guide covers:
- 📄 What FTB 3805V does and exactly who must file it
- 🧾 The documents and numbers to gather before you start
- ✍️ A line-by-line walkthrough of every part, box, and signature block
- 👥 Three filled-out examples using real California taxpayer scenarios
- ⚠️ The mistakes, deadlines, and penalties to avoid in 2025 and 2026
What the Form Is and Who Must File It
FTB 3805V is the California schedule that computes a current-year NOL, applies the state’s carryover rules, and tracks any disaster loss election under R&TC §17207.14. The form is published yearly by the Franchise Tax Board and is attached to your individual, estate, or trust return. The 2025 revision is the version filed with returns due April 15, 2026.
You must file FTB 3805V if you are a California resident, part-year resident, or nonresident who has a current-year NOL, a carryover from a prior year, or a qualifying disaster loss. Sole proprietors with Schedule C losses, real estate investors with Schedule E losses, and farmers with Schedule F losses are the most common filers. Fiduciaries who file Form 541 for an estate or trust also use FTB 3805V instead of the corporate equivalent, FTB 3805Q.
The form exists because California suspended NOL deductions for tax years 2020, 2021, and 2022 under AB 85 and reinstated them through SB 113. The suspension extended carryover periods, so 2025 filers often have older NOLs still alive. Filing the form is how you preserve those years on the FTB’s books, and skipping it means losing the deduction permanently.
Before You Start: Documents and Information You Need
Gathering the right paperwork before you open FTB 3805V saves hours of recalculating. California’s NOL math depends on numbers from your federal return, your prior-year California return, and any disaster declarations from the Governor’s Office of Emergency Services. Missing a single figure usually forces you to redo Part I and Part III from scratch.
Here is the pre-filing checklist every filer should complete:
- Your federal Form 1040 and federal Schedule A (Form 1045), because California starts with federal taxable income before adjustments. Without it, line 1 of FTB 3805V is impossible to verify.
- Your California Form 540, Form 540NR, or Form 541 for the current year. The NOL flows to a specific line on each return, and you need the right line number.
- Prior-year FTB 3805V forms going back up to 20 years. California allows a 20-year carryover for losses generated after 2012, and the FTB asks for each year separately.
- Schedule C, Schedule D, Schedule E, or Schedule F showing the business or investment loss. The FTB cross-checks the loss type against Part III of the form.
- Disaster proclamation number from the Governor or President if you are claiming a disaster loss. Without the proclamation number, Part II is rejected.
- Federal Form 4684 if the loss involves a casualty. California conforms to the federal casualty loss computation but requires a separate state attachment.
- Your Social Security number, ITIN, or FEIN exactly as it appears on the return. A digit mismatch causes the FTB’s automated system to detach the form.
- Records of any AGI-based limitations such as the §461(l) excess business loss cap, since California partially conforms.
- A calculator or tax software that handles California-only adjustments. Federal NOL software often misses California’s 20-year rule and the disaster loss election.
- Bank account information if you expect a refund triggered by the NOL carryback or carryover.
Where to Get the Form and How to Access It
The official 2025 FTB 3805V PDF is hosted on the FTB’s forms library. The PDF is fillable, printable, and free, and it includes the 2025 instructions on the back pages. Always confirm the revision date in the upper-right corner reads 2025 before you start typing.
You can also pull the form through the FTB Forms and Publications search by entering 3805V in the keyword box. Most major software packages — TurboTax, H&R Block, Drake, Lacerte, and ProSeries — auto-generate FTB 3805V when a California NOL is detected on the return. Check that the software’s version matches the FTB’s posted version, because mid-year revisions do happen.
If you prefer paper, call the FTB forms hotline at 800-338-0505 and request the form by mail. The FTB ships forms within 10 business days. You can also pick up a copy in person at any FTB Field Office, including Sacramento, Oakland, San Diego, Santa Ana, Los Angeles, and San Francisco.
Step-by-Step: How to Fill Out FTB 3805V Line by Line
The form has four parts plus a header. Each part has its own logic, and the FTB scans them in order. Filling them out of sequence almost always produces a wrong carryover number, so work top to bottom.
Header: Name(s) and SSN/ITIN/FEIN
This block at the top asks for the taxpayer’s name and identifying number exactly as written on the main return.
Enter the primary filer’s full legal name first, followed by a spouse’s name if filing jointly. Use the same order as Form 540. Write the SSN, ITIN, or FEIN with no dashes if the form is being scanned, or with dashes if you are using the fillable PDF.
For example, Maria Lopez enters her name and SSN 123-45-6789 exactly as they appear on her 2025 Form 540. If she filed jointly with her husband Carlos, she writes Maria and Carlos Lopez in the name line and uses Maria’s SSN as the primary identifier.
A common edge case is a name change after marriage or divorce. If the Social Security Administration has not yet updated the name, use the old name to match SSA records, not the new one.
The most common mistake is entering a spouse’s SSN when the spouse has no NOL of their own. The consequence is that the FTB applies the loss to the wrong taxpayer’s account and the carryover disappears from the primary filer’s record.
A frequent misconception is that the header is just a formality. In reality, the FTB uses this block to link the form to the right tax-year carryover database, and a single typo can sever that link.
Part I, Line 1 — Federal NOL from Federal Schedule A (Form 1045)
Line 1 starts the California NOL computation by importing the federal NOL figure from federal Schedule A, line 25.
Enter the federal NOL as a positive number even though it represents a loss. If the federal figure is zero or positive, you have no NOL to compute and you can stop here unless you have a disaster loss in Part II.
For instance, David Chen had a federal NOL of $42,000 on his 2025 Schedule A, line 25, so he writes 42,000 on line 1 of FTB 3805V.
The edge case here is a taxpayer with a federal NOL but no California NOL because of state-only addbacks like the California depreciation difference. In that case, line 1 still gets the federal number, and the California adjustments knock it down later.
The most common mistake is entering the federal NOL as a negative number. The FTB’s system reads negatives as a refund of the NOL, which throws off Part III and produces a notice of proposed assessment.
A widespread misconception is that California’s NOL equals the federal NOL. It rarely does, because California does not conform to bonus depreciation, §199A, or the full federal §461(l) rules.
Part I, Line 2 — California Adjustments
Line 2 captures the state-only adjustments that change the federal NOL into a California NOL.
Add back any federal deductions California disallows, such as bonus depreciation, and subtract any California-only deductions. Use Schedule CA (540) as your worksheet.
For example, Aisha Patel had $8,500 of bonus depreciation on her federal return that California disallows, so she enters 8,500 on line 2 to add it back.
A nuance arises when the taxpayer is a part-year resident. Only adjustments tied to California-source income belong on line 2, and the rest stay off the form entirely.
The classic mistake is double-counting the depreciation difference by also entering it on Schedule CA. The consequence is an FTB notice and a reduced NOL for the year.
People often think line 2 is optional. It is not — leaving it blank when adjustments exist makes the carryover wrong for every future year.
Part I, Line 3 — California NOL
Line 3 is the net of line 1 and line 2 and represents the California NOL for the current year.
Subtract line 2 from line 1 if line 2 is a reduction, or add if it is an addition. Enter the result as a positive number.
David Chen nets his $42,000 federal NOL against $3,000 of California addbacks and writes 45,000 on line 3.
If the result is zero or negative, you have no California NOL and you skip to Part II for any disaster loss.
The mistake filers make is forgetting to flip the sign of line 2 before combining. The consequence is an inflated or deflated NOL that the FTB will recompute and override.
A misconception is that line 3 is the amount you deduct this year. It is not — it is the loss being created this year, which gets carried to future years.
Part II — Election to Carry NOL Forward (Disaster Loss)
Part II is where you elect to treat a loss as a California disaster loss under R&TC §17207.14.
Check the box, enter the disaster name, and write the Governor’s or President’s proclamation date. Disaster losses get a 100% deduction in the year of the loss and a 15-year carryover.
For example, Carlos Mendez lost his Pacific Palisades rental property in the January 2025 wildfires and elects disaster treatment by entering Palisades Fire and 01/07/2025.
The edge case is a federally declared disaster that California has not separately proclaimed. In that case, you still qualify because California conforms to federal disaster declarations under SB 113.
The most common mistake is checking the box without naming the disaster. The FTB rejects unnamed disaster claims automatically.
People wrongly believe disaster losses are the same as casualty losses. They are not — a casualty loss can be a disaster loss only if the event is a declared disaster.
Part III, Line 1 — Current Year NOLs
Line 1 of Part III breaks the current-year NOL into its component types.
Enter the loss in the correct column: General NOL, New Business, Eligible Small Business, or Disaster Loss. Use the federal NOL type as a starting point but apply California’s definitions.
Aisha Patel runs a two-year-old graphic design firm and enters her $12,000 NOL in the New Business column because California gives new businesses a longer carryover.
A nuance: New Business status under R&TC §17276.20 requires the business to have been in operation for fewer than three years.
The mistake is mixing General NOL and New Business NOL in the same column. The consequence is that the FTB reclassifies and shortens the carryover.
A misconception is that all small businesses qualify as New Business. They do not — the §17276.20 definition is narrower than the federal small business definition.
Part III, Line 2 — Prior Year NOL Carryovers
Line 2 lists every prior-year NOL still being carried forward, year by year.
Enter the year of loss, the original NOL amount, the amount used in prior years, and the amount remaining. Add a separate row for each year of loss.
For example, David Chen carries $18,000 from 2018, $7,500 from 2020 (suspended), and $4,000 from 2023, so he enters three rows on line 2.
The edge case is the 2020–2022 NOL suspension. Losses generated in those years still exist but the carryover clock paused, giving filers extra years.
The mistake is dropping a year because the loss was suspended. The consequence is permanent loss of the deduction.
People believe California’s NOL carryover is 20 years for everyone. It is — but the suspension years extend the window for affected taxpayers.
Part III, Line 3 — NOL Used This Year
Line 3 shows how much of each prior-year NOL is being used against current-year California taxable income.
Apply the oldest NOL first, then move forward in time. Stop when current-year California taxable income reaches zero.
Carlos Mendez has $30,000 of California taxable income before NOLs and uses $18,000 from 2018 first, then $7,500 from 2020, and $4,500 of his 2023 carryover.
The nuance is that disaster losses are taken before general NOLs in the same year because of the 100% rule.
The mistake is using the newest NOL first. The consequence is wasted carryover years on losses that would have expired anyway.
A misconception is that you choose which year to use. You do not — California requires FIFO ordering.
Part IV — NOL Carryover and Disaster Loss Limitations
Part IV computes the unused NOL that gets carried to next year.
Subtract line 3 from line 2 for each year, and enter the remainder. Total the column at the bottom.
Aisha Patel started 2025 with $40,000 of carryover, used $22,000, and writes 18,000 as her total carryover to 2026.
The edge case is when current-year taxable income is negative even before the NOL deduction. In that case, none of the carryover is used and Part IV equals Part III, line 2.
The mistake is netting carryover against a year the FTB suspended. The consequence is the FTB rebuilding the schedule and issuing a corrected notice.
People believe Part IV is automatic in tax software. It often is not — many programs default to a 10-year carryover and miss California’s 20-year rule.
Three Filled-Out Examples Using Real Scenarios
Below are three scenarios that show how FTB 3805V works in practice for the most common California filer profiles. Each table follows one named taxpayer through the form.
Scenario 1: Maria Lopez, Sole Proprietor in Fresno
Maria runs a small bakery that lost $35,000 in 2025 because of an equipment failure. She files Form 540 jointly with her husband.
| Form Section | What Maria Enters |
|---|---|
| Header — Name | Maria and Carlos Lopez |
| Header — SSN | 123-45-6789 |
| Part I, Line 1 | 35,000 (federal NOL) |
| Part I, Line 2 | 2,000 (California depreciation addback) |
| Part I, Line 3 | 37,000 (California NOL) |
| Part II | Not checked (no disaster) |
| Part III, Line 1 | 37,000 in General NOL column |
| Part III, Line 2 | Blank (no prior-year carryover) |
| Part IV — Total Carryover | 37,000 to 2026 |
Scenario 2: Carlos Mendez, Palisades Fire Victim
Carlos owned a rental in Pacific Palisades that burned down in January 2025. He elects disaster loss treatment.
| Form Section | What Carlos Enters |
|---|---|
| Header — Name | Carlos Mendez |
| Header — SSN | 987-65-4321 |
| Part I, Line 1 | 180,000 (federal NOL) |
| Part I, Line 2 | 0 |
| Part I, Line 3 | 180,000 |
| Part II — Disaster Name | Palisades Fire |
| Part II — Proclamation Date | 01/07/2025 |
| Part III, Line 1 | 180,000 in Disaster Loss column |
| Part IV — Total Carryover | 150,000 to 2026 (after using $30,000) |
Scenario 3: Janet Wu, Trustee of the Wu Family Trust
Janet files Form 541 for an irrevocable trust that holds rental real estate and generated a $24,000 loss.
| Form Section | What Janet Enters |
|---|---|
| Header — Name | Wu Family Trust |
| Header — FEIN | 12-3456789 |
| Part I, Line 1 | 24,000 |
| Part I, Line 2 | 1,500 (CA addback) |
| Part I, Line 3 | 25,500 |
| Part II | Not checked |
| Part III, Line 1 | 25,500 in General NOL |
| Part III, Line 2 | 9,000 from 2019 |
| Part III, Line 3 | 9,000 used this year |
| Part IV — Total Carryover | 25,500 to 2026 |
How to File the Completed Form
FTB 3805V is never filed alone — it always rides with a main return. Choose the channel that matches your main return and keep proof of filing.
If you e-file through software, the form attaches automatically when you check the NOL box during the California interview. The FTB’s CalFile portal accepts FTB 3805V at no cost for eligible taxpayers, with an instant electronic confirmation that serves as proof of filing.
If you file by mail, attach FTB 3805V to your Form 540, 540NR, or 541 and send it to the Franchise Tax Board, PO Box 942840, Sacramento, CA 94240-0001 for refunds, or PO Box 942867 for payments. There is no separate fee for the form. Use certified mail with return receipt and keep the green card as proof.
If you file in person, drop the return at any FTB Field Office and ask the cashier for a date stamp on your copy. There is no fax channel for FTB 3805V because the FTB does not accept faxed returns. Tax professionals who e-file through Lacerte, Drake, or ProSeries should request the FTB acknowledgment file as proof. Processing time is typically 8–12 weeks for paper and 2–4 weeks for e-filed returns.
What Happens After You File
Once the FTB receives your return, the agency logs FTB 3805V into its NOL tracking system and updates your account. You can verify the carryover by logging into MyFTB and checking the Tax Year Information tab. The carryover usually appears within 30 days of return processing.
If the FTB disagrees with your computation, you will receive a Notice of Proposed Assessment (NPA) within 6 to 12 months. The notice gives you 60 days to protest. Common reasons for an NPA include math errors, wrong carryover years, and missing disaster proclamation numbers.
If your NOL produces a refund, the FTB issues it within 8 to 12 weeks of return acceptance. Refunds tied to disaster losses are often expedited to within 30 days under the FTB’s disaster relief program. Keep your FTB 3805V copies for at least 4 years past the last carryover year, since California’s audit window stays open until the loss is fully absorbed.
Mistakes to Avoid When Filling Out the Form
NOL math is unforgiving, and small slips compound across years. Here are the errors the FTB sees most often and the consequence of each.
- Skipping FTB 3805V entirely when you have a California NOL — the FTB disallows the deduction permanently.
- Entering the federal NOL without California adjustments on line 2 — your carryover is wrong from year one.
- Using the wrong column in Part III, Line 1 — the FTB reclassifies and shortens your carryover window.
- Forgetting suspended years (2020–2022) — you lose track of losses still alive under SB 113.
- Applying NOLs out of FIFO order — newer losses survive while older ones expire unused.
- Failing to attach the federal Schedule A (Form 1045) — the FTB cannot verify line 1 and assesses a deficiency.
- Missing the Governor’s proclamation date in Part II — disaster treatment is denied.
- Treating a federal casualty as a California disaster without a proclamation — the loss reverts to general NOL.
- Mixing personal and trust NOLs on one form — the FTB splits them and issues two notices.
- Forgetting to total Part IV — the FTB enters zero carryover, killing the deduction.
- Using a prior-year revision of the form — outdated lines do not match current return processing.
- Filing FTB 3805V without the main 540 or 541 — the form is detached and discarded.
Do’s and Don’ts
A short list of practical rules can save hours and prevent rejections.
- Do confirm the 2025 revision date before typing — older versions do not scan.
- Do attach federal Schedule A (Form 1045) every year — it backs up line 1.
- Do keep a master spreadsheet of all NOL years — the FTB asks for them at audit.
- Do use FIFO ordering for prior-year NOLs — it is required by California law.
- Do log into MyFTB after filing to verify the carryover posted correctly.
- Do consult a CPA when claiming a disaster loss — the election is irrevocable.
- Don’t paraphrase the field labels — use the exact box names from the form.
- Don’t enter losses as negatives — the FTB system reads them as gains.
- Don’t drop suspended years from your carryover schedule — they are still alive.
- Don’t combine spouse and personal NOLs unless filing jointly — they are separate.
- Don’t ignore the 20-year limit — losses past year 20 vanish automatically.
- Don’t forget to sign the underlying return — an unsigned return voids FTB 3805V.
Pros and Cons of Filing on Your Own vs. With Help
Some filers can handle FTB 3805V alone, while others save money by hiring a professional. The decision usually depends on the number of carryover years and whether a disaster election is involved.
Pros of filing pro se:
- No preparer fee, which can run $300–$1,200 for NOL returns.
- Direct control over your records and timing.
- You learn California’s NOL rules, which helps for future years.
- Free FTB tools like CalFile handle simple NOL cases.
- Faster turnaround if your records are already organized.
Cons of filing pro se:
- The 20-year carryover and FIFO rules are easy to misapply.
- Disaster loss elections are irrevocable and easy to misclaim.
- Software defaults often miss California-only adjustments.
- The FTB’s automated notices are confusing without tax training.
- One mistake on Part IV cascades for two decades.
FAQs
Do I have to file FTB 3805V if my federal NOL is zero?
No. You only file when there is a California NOL or a disaster loss election, and California’s NOL can exist even when the federal one is zero due to state addbacks.
Can I carry an NOL back to a prior year in California?
No. California eliminated NOL carrybacks for losses generated in 2019 or later under R&TC §17276, so all NOLs are carried forward only.
Is the 20-year carryover automatic for all losses?
Yes. All California NOLs created after 2012 carry forward 20 years, though New Business and disaster losses sometimes have different rules during the carryforward period.
Do I need to file FTB 3805V every year my carryover is open?
Yes. The FTB requires the form for every year you use or carry the NOL, even if the deduction is $0 in a given year.
What goes on Part I, Line 1 if my federal Schedule A line 25 is blank?
No. If federal Schedule A line 25 is blank you do not enter anything on line 1, but you must still complete Part II if you have a California-only disaster loss.
Do I check the disaster box in Part II for any wildfire?
No. Only fires covered by a Governor’s or President’s proclamation qualify, and you must list the proclamation name and date on the form.
Is the Palisades Fire a qualifying California disaster?
Yes. The January 2025 Palisades Fire was proclaimed by the Governor and qualifies under R&TC §17207.14, making rental and personal property losses fully deductible.
Can I switch a loss from General NOL to Disaster Loss after filing?
No. The disaster loss election is irrevocable once made, so you must decide before signing the original or amended return.
Should I write a spouse’s SSN in the header if only I have the NOL?
No. Use only the SSN of the spouse who incurred the loss, or list both if filing jointly with shared business losses.
Does California conform to the federal §461(l) excess business loss rule?
Yes. California partially conforms under AB 91, so the excess business loss is suspended and added to the NOL carryover.
Can a trust use FTB 3805V instead of FTB 3805Q?
Yes. Estates and trusts file FTB 3805V because FTB 3805Q is reserved for C corporations and other entities filing Form 100.
What happens if I miss the April 15, 2026 deadline?
No. Missing the deadline does not kill the NOL itself, but it triggers a late-filing penalty of 5% per month up to 25% on the underlying return.
Do I need to attach federal Form 1045 to FTB 3805V?
Yes. The FTB requires federal Schedule A (Form 1045) as backup, and missing it almost always triggers a Notice of Proposed Assessment within 12 months.
Does the FTB suspend NOLs again in 2025?
No. The 2020–2022 suspension under AB 85 ended, and SB 113 restored full NOL deductions for 2023 and later years, including 2025.
Related reading
- Business Tax Preparation in Roseville, CA
- How to Fill Out FTB Form 540 (w/Examples) + FAQs
- How to Fill Out California Form 540NR (w/Examples) + FAQs
- How to Fill Out California Form 541 (w/Examples) + FAQs
- How to Fill Out California Form 565 (w/Examples) + FAQs
- How to Fill Out California Form FTB 3520-PIT (w/Examples) + FAQs
- How to Fill Out California Form 100 (w/Examples) + FAQs