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California Court of Appeal

Swart Enterprises v. Franchise Tax Bd., 070922

In a case dealing with the issue of whether California's franchise tax applies to an out-of-state corporation whose sole connection with California is a 0.2 percent ownership interest in a manager-managed California limited liability company (LLC) investment fund, the trial court's judgment is affirmed where passively holding a 0.2 percent ownership interest, with no right of control over the business affairs of the LLC, does not constitute 'doing business' in California within the meaning of Rev. & Tax. Code section 23101.

Appellate Information

  • Decided
  • Published 2017/01/12


  • PENA


  • California Court of Appeal


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