Rev. & Tax. Code, § 23101 · Article 1. Definitions and General Provisions
Rev. & Tax. Code, § 23101
Text — As published in the Legislative Counsel's database, tables dated October 18, 2026 (pubinfo_2025.zip)
(a) “Doing business” means actively engaging in any transaction for the purpose of financial or pecuniary gain or profit.
(b) For taxable years beginning on or after January 1, 2011, a taxpayer is doing business in this state for a taxable year if any of the following conditions has been satisfied:
(1) The taxpayer is organized or commercially domiciled in this state.
(2) Sales, as defined in subdivision (e) or (f) of Section 25120 as applicable for the taxable year, of the taxpayer in this state exceed the lesser of five hundred thousand dollars ($500,000) or 25 percent of the taxpayer’s total sales. For purposes of this paragraph, sales of the taxpayer include sales by an agent or independent contractor of the taxpayer. For purposes of this paragraph, sales in this state shall be determined using the rules for assigning sales under Sections 25135 and 25136 and the regulations thereunder, as modified by regulations under Section 25137.
(3) The real property and tangible personal property of the taxpayer in this state exceed the lesser of fifty thousand dollars ($50,000) or 25 percent of the taxpayer’s total real property and tangible personal property. The value of real and tangible personal property and the determination of whether property is in this state shall be determined using the rules contained in Sections 25129 to 25131, inclusive, and the regulations thereunder, as modified by regulation under Section 25137.
(4) The amount paid in this state by the taxpayer for compensation, as defined in subdivision (c) of Section 25120, exceeds the lesser of fifty thousand dollars ($50,000) or 25 percent of the total compensation paid by the taxpayer. Compensation in this state shall be determined using the rules for assigning payroll contained in Section 25133 and the regulations thereunder, as modified by regulations under Section 25137.
(c) (1) The Franchise Tax Board shall annually revise the amounts in paragraphs (2), (3), and (4) of subdivision (b) in accordance with subdivision (h) of Section 17041.
(2) For purposes of the adjustment required by paragraph (1), subdivision (h) of Section 17041 shall be applied by substituting “2012” in lieu of “1988.”
(d) The sales, property, and payroll of the taxpayer include the taxpayer’s pro rata or distributive share of pass-through entities. For purposes of this subdivision, “pass-through entities” means a partnership or an “S” corporation.
Notes and commentary — not statutory text
History
Amended November 6, 2012, by initiative Proposition 39, Sec. 3.
Source of truth
- Edition
- As published in the Legislative Counsel's database, tables dated October 18, 2026 (pubinfo_2025.zip)
- Official file
- https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=RTC§ionNum=23101.
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- compose_ca.py 2026-10-22: the Legislative Counsel's CAML content files read by a tokenizer (caml_readers.reader_a); an independent xml.etree reading (caml_readers.reader_b) agrees on every section
This section cites
Provisions in this library that the text above cites, as it prints each citation. A range cited as “ss. 61.13-61.16” links its first and last provisions.
Revenue and Taxation Code
- Rev. & Tax. Code, § 17041Printed as Section 17041
- Rev. & Tax. Code, § 25120Printed as Section 25120
- Rev. & Tax. Code, § 25129Printed as Sections 25129 to 25131, inclusive
- Rev. & Tax. Code, § 25131Printed as Sections 25129 to 25131, inclusive
- Rev. & Tax. Code, § 25133Printed as Section 25133
- Rev. & Tax. Code, § 25135Printed as Sections 25135 and 25136
- Rev. & Tax. Code, § 25136Printed as Sections 25135 and 25136
- Rev. & Tax. Code, § 25137Printed as Section 25137
Cited by 16 provisions
Provisions in this library whose text cites Rev. & Tax. Code, § 23101. Each shows the citation as that text prints it.
Revenue and Taxation Code
- Rev. & Tax. Code, § 17276Printed as Section 23101
- Rev. & Tax. Code, § 17935Printed as Section 23101
- Rev. & Tax. Code, § 17941Printed as Section 23101
- Rev. & Tax. Code, § 17942Printed as Section 23101
- Rev. & Tax. Code, § 17948Printed as Section 23101
- Rev. & Tax. Code, § 19135Printed as Section 23101
- Rev. & Tax. Code, § 19900Printed as Section 23101
- Rev. & Tax. Code, § 19910Printed as Section 23101
- Rev. & Tax. Code, § 23156Printed as Section 23101
- Rev. & Tax. Code, § 23310Printed as Section 23101
- Rev. & Tax. Code, § 23311Printed as Section 23101
- Rev. & Tax. Code, § 23800.5Printed as Section 23101
- Rev. & Tax. Code, § 24416Printed as Section 23101
- Rev. & Tax. Code, § 24676Printed as Section 23101
- Rev. & Tax. Code, § 25113Printed as Section 23101
Procedural information only. Not legal advice and not a substitute for the advice of an attorney. Confirm the current text with the official publisher before relying on it.