2005 California Revenue and Taxation Code Sections 23101-23114 Article 1. Definitions and General Provisions

23101.  "Doing business" means actively engaging in any transaction
for the purpose of financial or pecuniary gain or profit.
23101.5.  (a) The Franchise Tax Board may determine that a
corporation is not doing business in this state for purposes of this
chapter or deriving income from sources within this state for
purposes of Chapter 3 (commencing with Section 23501) if its only
activities within this state are either or both of the following:
   (1) The purchase of personal property or services solely for its
own use or use by its affiliate outside this state if:
   (A) The corporation does not have more than 100 employees in this
state, whose duties are limited to solicitation, negotiation,
liaison, monitoring, auditing, and inspecting the personal property
or services acquired, or providing technical advice with respect to
its requirements, and
   (B) The corporation does not have more than 200 employees in this
state, whose duties are limited to solicitation, negotiation,
liaison, monitoring, auditing, and inspecting the personal property
or services acquired, or providing technical advice with respect to
its requirements, and the personal property or services purchased by
the corporation or its affiliate are used for the construction or
modification of a physical plant or facility located outside the
state, and
   (C) The combined number of employees in this state pursuant to
subparagraphs (A) and (B) does not exceed 200.
   (2) The presence of employees in this state only for the purpose
of attending a public or private school, college, or university.
   (b) A corporation may petition the Franchise Tax Board for a
determination in accord with procedures established by the Franchise
Tax Board.  The filing of that petition shall be deemed a waiver of
the confidentiality provisions of Section 19542 with respect to the
facts alleged in the petition and any additional evidence produced
with respect to those facts.
   (c) If the determination is made, it shall remain in force for
five years as long as the corporation continues to meet the above
criteria.  However, with respect to corporations meeting the above
criteria on or before January 1, 1978, the determination shall remain
in force indefinitely so long as the corporation continues to meet
the above criteria.
   (d) The corporation shall annually confirm with the Franchise Tax
Board within two months and 15 days after the close of its fiscal
year, in the manner as the Franchise Tax Board may prescribe, that
the facts relevant to the granting of the determination then in
effect remain unchanged or shall state and explain any changes that
have occurred since the preceding report was filed.
   (e) Where a corporation applying for or relying on the
determination is engaged in a unitary business, the limitation of 100
or 200 employees, as applicable, that is specified in paragraph (1)
of subdivision (a) shall apply to the aggregation of all corporations
within the unitary group.
   (f) Each taxpayer that sells property or services to a corporation
with more than 100 employees in this state, with respect to which
the determination has been made, shall file annually with the
Franchise Tax Board, in the manner as the Franchise Tax Board may
prescribe, a report identifying the number of its employees within
this state directly attributable to the construction or modification
of a physical plant or facility located outside the state.
   (g) This section shall become operative on January 1, 1994.
23102.  Any corporation holding or organized to hold stock or bonds
of any other corporation or corporations, and not trading in stock or
bonds or other securities held, and engaging in no activities other
than the receipt and disbursement of dividends from stock or interest
from bonds, is not a corporation doing business in this State for
the purposes of this chapter.
23104.  (a) For purposes of this part only, any corporation that is
not incorporated under the laws of this state and whose sole activity
in this state is engaging in convention and trade show activities,
as described in Section 513(d)(3)(A) of the Internal Revenue Code,
for seven or fewer calendar days, or any portion thereof, during the
taxable year and that does not derive more than ten thousand dollars
($10,000) of gross income reportable to this state from those
activities during that taxable year is not a corporation doing
business in this state.
   (b) For purposes of this section, the determination of gross
income reportable to this state of a taxpayer shall be made by
including the gross income reportable to this state of each member of
the "commonly controlled group" (as defined by Section 25105) of
which the taxpayer is a member.
23113.  The tax imposed under this chapter shall attach whether a
taxpayer has a taxable year of twelve months or less.
23114.  (a) A corporation shall not be subject to the taxes imposed
by this chapter if the corporation did no business in this state
during the taxable year and the taxable year was 15 days or less.
   (b) The period of time for which a corporation is not subject to
taxes imposed by this chapter as provided in subdivision (a) may not
be considered a taxable year for purposes of subdivision (e) or
paragraph (1) of subdivision (f) of Section 23153.