California Form 568 is a separate report to the state regarding your LLC disregarded entity and is not tied directly to Form 540. California requires SMLLCs to file Form 568, even though they are considered a disregarded entity for tax purposes. They are subject to the annual tax, LLC fee and credit limitations.
Your California Schedule CA is where any California differences between your income and expenses on the Federal Schedule C and the California return are reported. TurboTax also prepares a California Schedule C Worksheet for your records.
The instructions for Form 568 include the following regarding Schedule IW:
If the SMLLC does not meet the 3 million criteria for filing Schedule B (568) and Schedule K (568), the SMLLC is still required to complete Schedule IW. Disregarded entities that do not meet the filing requirements to complete Schedule B or Schedule K should prepare Schedule IW by entering the California amounts attributable to the disregarded entity from the member’s federal Schedule B, C, D, E, F (Form 1040), or additional schedules associated with other activities. For example, if an SMLLC has IRC Section 1231 gains, the SMLLC will need to get the amount from the schedule containing that information, such as Schedule D-1, and enter the amount on line 14 of the Schedule IW.
Be sure to go through the California questionnaire and answer all of the questions to ensure that any California differences are captured for Schedule CA.
[Edited 04/10/24| 10:47am PST]
@JG532
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