Question about "Sales Shipped"

[faithbeerose]

I'm trying to do my state business return and I'm at the apportionment section. It is asking about "Sales shipped to CA Purchasers" both "from outside CA" and "from within CA."

If I am a filmmaker and I make films for clients, should I be answered questions about sales shipped, I am not technically shipping anything to anyone? 

Is there a way to put all my gross receipts under services instead? Or do I just apply this "shipped" language to my business?

[MelindaS1]

You are correct that this language does not apply to you; this is for product sales. If you did not ship any tangible items to CA customers, indicate that with zero entries, and you will then be prompted to enter your CA-source intangible property (filmmaking) sales. Definitions from the CA Franchise Tax Board page, Help with apportionment and allocation:

Sales of tangible personal property

Sales of tangible personal property are in California if at least one of the following applies:

• The property is delivered or shipped to a purchaser in California
• The property is shipped from California to a state where the taxpayer is not taxable or the purchaser is the U.S. government

Sales of other than tangible personal property

For taxable years beginning on or after January 1, 2013, sales of other than tangible personal property are assigned to California sales factor based on market assignment.

Under market assignment, sales of other than tangible personal property are assigned to the California sales factor numerator if:

• Sales from services are in California to the extent the purchaser of the service received the benefit of the services in California
• Sales from intangible property are in California to the extent the property is used in California. In the case of marketable securities, sales are in California if the customer is in California