PBA is the abbreviation for Principal Business Activity Code. It is a 6-digit code designed to classify a business by the type of activity in which it is engaged. This code is required by the IRS and the states on all business returns.
TaxSlayer Pro provides a quick index of these codes within the program in the business return, allowing a preparer to determine the code searching by category or type of business. The instructions for the IRS forms that required the code, such as Schedule C and Forms 1065, 1120, and 1120-S also include a list of codes.
The IRS PBA list is based on the North American Industry Classification System (NAICS). California has modified the list for its own purposes, and many of the codes are different than the federal codes. If an e-filed California return rejects for the PBA, most likely the federal code isn't in the California PBA list. To fix the reject, change the code in the federal return to the corresponding California PBA code, then reopen the California return to update the return with the new code, then e-file the California return.
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