Schedule D (541) Instructions (2025):
California Capital Gain or Loss

How to Complete Schedule D (541): Line-by-Line Instructions

Name as shown on the tax return

Enter the name of the organization, estate or trust as it appears on the associated CA Form 541 or CA Form 109.

FEIN

Enter the federal employer identification number (FEIN) associated with the entity and its related tax return.

Part I - Capital Gain and Loss

Line 1 – Sales or Exchanges of Capital Assets

• Report each sale or exchange of a capital asset during the 2025 taxable year in line 1. 
• The 2025 Schedule D (541) provides six columns for each transaction: description of property, date acquired, date sold, gross sales price, cost or other basis plus expenses of sale, and gain or loss.

Column (a) – Description of Property

Enter a description of the capital asset that was sold or exchanged. The description should be specific enough to identify the property.

Column (b) – Date Acquired

Enter the date the capital asset was acquired using the format mm/dd/yyyy.

Column (c) – Date Sold

Enter the date the capital asset was sold or exchanged, using the mm/dd/yyyy format.

Column (d) – Gross Sales Price

Enter the gross sales price of the capital asset. This represents the gross amount associated with the sale before accounting for the applicable expense of sale reported in Column (e).

Column (e) – Cost or Other Basis, as Adjusted, Plus Expense of Sale

• Enter the property's cost or other basis, as adjusted, plus the expense of sale.
• This column therefore combines;

Column (f) – Gain or Loss

Calculate the gain or loss by subtracting Column (e) from Column (d).

For Example:

Here is an example as quick reference for filing Line 1 of Part I in Schedule D (541),

Line 2 – Capital Gain From Installment Sales

• Enter the capital gain from installment sales reported on FTB 3805E.
• If an estate or trust sold property at a gain during the tax year and will receive a payment in a later tax year, the installment method generally applies.
• If the estate or trust elects out of the installment method, report the gain or loss on Line 1 instead.

Line 3 – Net Gain or Loss From Pass-Through Entities

Enter your share of net gain or loss from:

• S corporations
• Fiduciaries
• Partnerships
• Limited liability companies (LLCs)

Line 4 – Capital Gain Distributions

Enter the amount of capital gain distributions reported in federal Form 1099-DIV, refer to Box 2a.

Line 5 – Net Gain or Loss

Line 5 combines the gain or loss amounts from Line 1, Column (f), and Lines 2, 3, and 4.

For Example:

Line 6 – Gain From California Schedule D-1

Enter the applicable gain from California Schedule D-1, Sales of Business Property.

Line 7 – Capital Loss Carryover form Prior-Year

• Enter the amount of unused capital loss carryover from prior years. For the 2025 Schedule D (541), Line 7 specifically refers to the capital loss carryover from 2024.
• There is no capital loss carryover from a decedent to an estate.

Line 8 – Net Gain or Loss

Line 8 calculates the final net gain or loss for Part I by combining Line 5, Line 6, and Line 7.

For Example:

Part II – Summary of Part I

Line 9 – Allocation of Capital Gain or Loss

• Use Line 9 to summarize the net gain or loss calculated on Part I, Line 8, and allocate the amount between beneficiaries and the fiduciary. If Column (c) shows a net loss, complete Part III.
• Line 9 has three columns: (a) Beneficiaries, (b) Fiduciary, and (c) Total.

Column (a) – Beneficiaries

• Enter the amount of capital gain or loss allocable to the beneficiaries.
• Generally, do not allocate capital losses to beneficiaries unless the losses are required to offset capital gains.
• If this is the final year of the estate or trust, a capital loss carryover may be allowed to beneficiaries to the extent of their distributive shares.

Column (b) – Fiduciary

• Enter the amount of capital gain or loss allocable to the fiduciary.
• Also include in Column (b) any capital gain paid or permanently set aside for charitable purposes under IRC Section 642(c).

Column (c) – Total

• Enter the total of Columns (a) and (b).
• Where Column (c) = Column (a) + Column (b)

For Example:

Part III – Computation of Capital Loss Limitation

Line 10 – Capital Loss Limitation

Complete Line 10 when Line 9, Column (c), shows a net loss. Enter the smaller of the net loss on Line 9, Column (c), or $3,000 as a loss on Line 10.