{"id":2395,"date":"2022-04-26T07:52:23","date_gmt":"2022-04-26T07:52:23","guid":{"rendered":"https:\/\/crowdsourcelawyers.com\/california-statutes\/?page_id=2395"},"modified":"2022-05-20T23:45:42","modified_gmt":"2022-05-20T23:45:42","slug":"revenue-and-taxation-code-rtc-17955","status":"publish","type":"page","link":"https:\/\/crowdsourcelawyers.com\/california-statutes\/california-statutes\/revenue-and-taxation-code-rtc-17955\/","title":{"rendered":"Revenue and Taxation Code &#8211; RTC 17955"},"content":{"rendered":"\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-l2fuk8bj-a64a01d084ab8cbfae7b3b772c5eb15e\">\n#top .av-special-heading.av-l2fuk8bj-a64a01d084ab8cbfae7b3b772c5eb15e{\npadding-bottom:10px;\n}\nbody .av-special-heading.av-l2fuk8bj-a64a01d084ab8cbfae7b3b772c5eb15e .av-special-heading-tag .heading-char{\nfont-size:25px;\n}\n.av-special-heading.av-l2fuk8bj-a64a01d084ab8cbfae7b3b772c5eb15e .av-subheading{\nfont-size:22px;\n}\n<\/style>\n<div  class='av-special-heading av-l2fuk8bj-a64a01d084ab8cbfae7b3b772c5eb15e av-special-heading-h1 blockquote modern-quote  avia-builder-el-0  el_before_av_hr  avia-builder-el-first '><div class='av-subheading av-subheading_above'><p>California<\/p>\n<\/div><h1 class='av-special-heading-tag '  itemprop=\"headline\"  >Revenue and Taxation Code &#8211; RTC \u00a7 17955<\/h1><div class=\"special-heading-border\"><div class=\"special-heading-inner-border\"><\/div><\/div><\/div>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-av_hr-3a876428eececa9d35452247ddb053af\">\n#top .hr.hr-invisible.av-av_hr-3a876428eececa9d35452247ddb053af{\nheight:50px;\n}\n<\/style>\n<div  class='hr av-av_hr-3a876428eececa9d35452247ddb053af hr-invisible  avia-builder-el-1  el_after_av_heading  el_before_av_textblock '><span class='hr-inner '><span class=\"hr-inner-style\"><\/span><\/span><\/div>\n<section  class='av_textblock_section av-av_textblock-e878f05c31dff72941bf1e49a00d9ff5 '  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.avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad #searchsubmit{\nbackground-color:#edae44;\n}\n#top .avia_search_element.av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad .av_searchsubmit_wrapper{\nbackground-color:#edae44;\n}\n<\/style>\n<div  class='avia_search_element av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad  avia-builder-el-3  el_after_av_textblock  el_before_av_hr '><search><form action='https:\/\/crowdsourcelawyers.com\/california-statutes\/' id='searchform_element' method='get' class='' data-element_id='av-avia_sc_search-4ee94ae86cde3b232e718bb4ac84e6ad' ><div class='av_searchform_wrapper'><input type='search' value='' id='s' name='s' placeholder='Search CA statutes' aria-label='Search CA statutes' class='av-input-field ' required \/><div class='av_searchsubmit_wrapper '><input type='submit' value='Find' id='searchsubmit' class='button ' title='View results on search page' aria-label='View results on search page' \/><\/div><input type='hidden' name='numberposts' value='10' \/><input type='hidden' name='results_hide_fields' value='' \/><\/div><\/form><\/search><\/div>\n\n<style type=\"text\/css\" data-created_by=\"avia_inline_auto\" id=\"style-css-av-av_hr-3a876428eececa9d35452247ddb053af\">\n#top .hr.hr-invisible.av-av_hr-3a876428eececa9d35452247ddb053af{\nheight:50px;\n}\n<\/style>\n<div  class='hr av-av_hr-3a876428eececa9d35452247ddb053af hr-invisible  avia-builder-el-4  el_after_avia_sc_search  el_before_av_textblock '><span class='hr-inner '><span class=\"hr-inner-style\"><\/span><\/span><\/div>\n<section  class='av_textblock_section av-l2fuomh7-3b01e198a0eac888346e4186ad541571 '   itemscope=\"itemscope\" itemtype=\"https:\/\/schema.org\/CreativeWork\" ><div class='avia_textblock'  itemprop=\"text\" ><div class=\"row\">\n<div class=\"subsection\"><\/div>\n<div class=\"subsection\">\n<div class=\"subsection\">\n<p>(a)\u2002<span class=\"added-material\">For purposes of computing \u201ctaxable income of a nonresident or part-year resident\u201d under\u00a0<span class=\"cite\">paragraph (1) of subdivision (i) of Section 17041\u00a0<\/span>, n<\/span>otwithstanding\u00a0<span class=\"cite\">Sections 17951\u00a0<\/span>,\u00a0<span class=\"cite\">17952\u00a0<\/span>, and\u00a0<span class=\"cite\">17953\u00a0<\/span>, gross income of a nonresident (as defined in\u00a0<span class=\"cite\">Section 17015\u00a0<\/span>) from sources within this state shall not include dividends, interest, or gains and losses from qualifying investment securities if any of the following apply:<\/p>\n<div class=\"subsection\">\n<p>(1)\u2002In the case of an individual, with respect to the qualifying investment securities, the taxpayer&#8217;s only contact with this state is through a broker, dealer, or investment adviser located in this state.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(2)\u2002In the case of a partner&#8217;s distributive share of income from qualifying investment securities, the partnership qualifies as an investment partnership, whether or not the partnership has a usual place of business located in this state.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(3)\u2002In the case of a beneficiary of a qualifying estate or trust, the taxpayer&#8217;s only contact with this state is through an investment account managed by a corporate fiduciary located in this state.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(4)\u2002In the case of a unit holder in a regulated investment company (as defined in\u00a0<span class=\"cite\">Section 851 of the Internal Revenue Code\u00a0<\/span>), to the extent of the dividends distributed by the regulated investment company, whether or not the regulated investment company has a principal place of business in this state.<\/p>\n<\/div>\n<\/div>\n<div class=\"subsection\">\n<p>(b)\u2002This section shall not apply to income derived from investment activity that is interrelated with any trade or business activity of the nonresident or an entity in which the nonresident owns an interest in this state, whose primary activities are separate and distinct from the acts of acquiring, managing, or disposing of qualified investment securities, or if those securities were acquired with working capital of a trade or business activity conducted in this state in which the nonresident owns an interest.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(c)\u2002For purposes of this section:<\/p>\n<div class=\"subsection\">\n<p>(1)\u2002\u201c<span class=\"wordphrase\">Investment partnership<\/span>\u201d means a partnership that meets both of the following requirements:<\/p>\n<div class=\"subsection\">\n<p>(A)\u2002No less than 90 percent of the partnership&#8217;s cost of its total assets consist of qualifying investment securities, deposits at banks or other financial institutions, and office space and equipment reasonably necessary to carry on its activities as an investment partnership.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(B)\u2002No less than 90 percent of its gross income consists of interest, dividends, and gains from the sale or exchange of qualifying investment securities.<\/p>\n<\/div>\n<\/div>\n<div class=\"subsection\">\n<p>(2)\u2002\u201c<span class=\"wordphrase\">Qualifying estate or trust<\/span>\u201d means an estate or trust that meets both of the following requirements:<\/p>\n<div class=\"subsection\">\n<p>(A)\u2002No less than 90 percent of the estate&#8217;s or trust&#8217;s cost of its total assets consist of qualifying investment securities, deposits at banks or other financial institutions, and office space and equipment reasonably necessary to carry on its investment activities.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(B)\u2002No less than 90 percent of its gross income consists of interest, dividends, and gains from the sale or exchange of qualifying investment securities.<\/p>\n<\/div>\n<\/div>\n<div class=\"subsection\">\n<div class=\"subsection\">\n<p>(3)(A)\u2002\u201cQualifying investment securities\u201d include all of the following:<\/p>\n<div class=\"subsection\">\n<p>(i)\u2002Common stock, including preferred or debt securities convertible into common stock, and preferred stock.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(ii)\u2002Bonds, debentures, and other debt securities.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(iii)\u2002Foreign and domestic currency deposits or equivalents and securities convertible into foreign securities.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(iv)\u2002Mortgage- or asset-backed securities secured by federal, state, or local governmental agencies.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(v)\u2002Repurchase agreements and loan participations.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(vi)\u2002Foreign currency exchange contracts and forward and futures contracts on foreign currencies.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(vii)\u2002Stock and bond index securities and futures contracts, and other similar financial securities and futures contracts on those securities.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(viii)\u2002Options for the purchase or sale of any of the securities, currencies, contracts, or financial instruments described in clauses (i) to (vii), inclusive.<\/p>\n<\/div>\n<div class=\"subsection\">\n<p>(ix)\u2002Regulated futures contracts.<\/p>\n<\/div>\n<\/div>\n<div class=\"subsection\">\n<p>(B)\u2002\u201cQualifying investment securities\u201d does not include an interest in a partnership unless that partnership is itself an investment partnership.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<p><br class=\"avia-permanent-lb\" \/><br class=\"avia-permanent-lb\" \/><\/p>\n<\/div>\n<\/div>\n<hr \/>\n<p><a href=\"https:\/\/crowdsourcelawyers.com\/\">CrowdSourceLawyers.com<\/a><\/p>\n<\/div><\/section>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":7,"featured_media":0,"parent":2019,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-2395","page","type-page","status-publish","hentry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Revenue and Taxation Code - RTC 17955 - California Statutes<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/crowdsourcelawyers.com\/california-statutes\/california-statutes\/revenue-and-taxation-code-rtc-17955\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" 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