Legal Entity Ownership Program (Leop)

Form BOE-100-B Statement of Change in Control and Ownership of Legal Entities is sent to legal entities (corporations, partnerships, limited liability companies) to obtain additional information on a transaction reported on the Franchise Tax Board (FTB) income tax return for the entity. This statement (commonly referred to as questionnaire) is sent by the Board of Equalization (Board) to entities who have answered “yes” to any one of the three Legal Entity Ownership Program (LEOP) questions or failed to answer the questions. (Note: the FTB tax return instructions state that all three questions must be answered – See below for tax form information.) An example of the preprinted information to the right of the “State Use Only” box on Form BOE-100-B would indicate the following:

Revenue and Taxation Code section 64(e) provides that the FTB is to assist the Board in discovering changes in control and ownership of legal entities (i.e., corporations, partnerships, and limited liability companies) that own real property. FTB provides this assistance through questions on the income tax returns filed by legal entities (for corporations, Form 100, question J; for partnerships, Form 565, question T; and for limited liability companies, Form 568, question O). Depending on the entities' answers, FTB transmits to the Board the names and addresses of the entities. If an entity answers yes to any of the 3 questions on the return or the entity failed to answer the questions, FTB transmits this information to BOE. (Note: Beginning with the 2006 tax year, 3 questions were included on the FTB tax returns within the questions identified above for corporations, partnerships, and limited liability companies: for 2005 and earlier years 1 question was included.)

Once the information is received from FTB, the Board sends to each identified entity Form BOE-100-B, Statement of Change in Control and Ownership of Legal Entities. The Board uses this statement to (a) determine whether a legal entity has undergone a change in control and ownership, and (b) if so, to identify any real property owned by the entity at the time of the change. The Board compiles the information and transmits it to county assessors, who have responsibility for reassessing real property (i.e., land, buildings, structures.) (Note: the Form BOE-100-B sent to the legal entity identifies the FTB tax return year and the entity's response to each of the 3 questions in the area to the immediate right of the State Use Only box below Q1 or Q2).

Filing Requirements
Revenue and Taxation Code Sections 480.1 and 480.2 provide that upon request of the Board an entity must file a statement of change in control and ownership with the Board or be subject to penalty provisions. An entity must file form BOE-100-B by the due date stated on the form. There are no extensions available.

If an entity does not submit the filing within 45 days of request (i.e., by the due date pre-printed on each entity's BOE-100-B) a penalty attaches by law. If the entity does not file the BOE-100-B in response to the first request, the Board will send a second BOE-100-B form, accompanied by a penalty notice. The entity has 60 days to file BOE-100B in response to the Board's second request. If the entity files the response within 60 days, the penalty may be abated. Extensions of time to file cannot be granted. (Note: the Form BOE-100-B sent to the legal entity identifies whether the form is the Board's first or second request, signified by Q1 or Q2, in the area to the immediate right of the State Use Only box.)

An entity may elect to file form BOE 100-B with the Board with respect to a change in control or ownership that occurred before filing its FTB tax return or before FTB transmits information to the Board regarding a specific income tax return. The Form and instructions are below.

Additional information regarding the Legal Entity Ownership Program in the form of Frequently asked questions can be accessed through the following link:
http://www.boe.ca.gov/proptaxes/faqs/propertyfaqs.htm

Additionally, further information regarding the Legal Entity Ownership Program and understanding the questions on the FTB Form 100 and BOE Form-100-B can be accessed through the following link: http://www.boe.ca.gov/proptaxes/formquestions.htm