how do I enter a California carryover credit from form 3804-CR from a prior year?

[CesarJ]

If your California carryover credit from Form 3804-CR relates to a K-1, TurboTax should flow the carryover automatically if you're importing your prior year return where the K-1 was entered. If you need to enter it manually:

1. Go to the California State Taxes section.
2. Navigate to the Credits area.
3. Find the option to enter carryover credits and select the relevant credit associated with your K-1.
4. Enter the carryover amount as shown on your prior year's Form 3804-CR.

Make sure your K-1 details are entered correctly under the income section for accurate carryover tracking.

[draut]

I didn't use TurboTax last year, so I'm entering the information manually. Here are the choices on the carryover credits page: 

• California Competes
• Disabled Access Credit for Eligible Small Businesses
• Donated Agricultural Products Transportation Credit
• Enhanced Oil Recovery Credit
• Low-Income Housing Credit
• Natural Heritage Preservation Credit
• New California Motion Picture and Television Credit
• Program 3.0 (Jan 1, 2025 - June 30, 2025) California Motion Picture and Television Production Credit
• Program 4.0 (July 1, 2025 - Dec 31, 2025) California Motion Picture and Television Production Credit
• New Donated Fresh Fruit or Vegetables Credit
• New Employment Credit
• Research Credit

None of these makes sense for a PTE credit from Form 3804-CR. Anything else I can do?

[MonikaK1]

If the PTE Credit wasn't automatically carried over to your current return because you didn't use TurboTax last year, you would enter it in your 2025 state tax return. 

If the pass-through entity is a Partnership, TurboTax will prompt you in the California interview to make any needed entries for the Partnership K-1. Under Partnership K-1 Adjustments, look for Credits and Form 3804-CR.

For taxable years beginning on or after January 1, 2021, and before January 1, 2026, California law allows an entity taxed as a partnership or an “S” corporation to annually elect to pay an elective tax at a rate of 9.3 percent based on its qualified net income (QNI). The election shall be made on an original, timely filed return and is irrevocable for the taxable year. See this California FTB webpage for more information.

Qualified taxpayers are allowed a credit equal to the qualified amount of the qualified taxpayer’s pro rata share or distributive share and guaranteed payments of the electing PTE’s qualified net income. That amount is reported on the qualified taxpayer’s Schedule K-1 (100S, 541, 565, or 568). 

If the available credit exceeds the current year tax liability the unused credit may be carried over to reduce the tax for five years or until exhausted, whichever occurs first. Apply the carryover to the earliest taxable year possible. In no event can the credit be carried back and applied against a prior year’s tax.

@draut