FTB's Research Credit best practices & federal determinations.

• Position: FTB news - Franchise Tax Board - Brief article

* If the IRS audited the Research Credit, the FTB will generally follow the federal determination. However, the FTB may need to request information to determine how to apply the IRS analysis to California research. If the research activities reviewed by the IRS were substantially different from research conducted in California, the FTB may need to examine California research activities.

* In addition, the FTB may examine computational or state issues where California does not conform to the federal research credit. In these situations, the FTB will need to request information, but remain cognizant of minimizing duplication of audit requests on taxpayers.

* If the IRS "no changed" the research credit in a prior year, the FIB will generally accept the prior year IRS determination to the extent the activities...