(a) Except as provided in subdivision (f), for taxable years beginning on or after January 1, 2003, the election provided for in Section 25110 shall be made on an original, timely filed return for the year of the election. The election will be considered valid if both of the following conditions are satisfied: (1) The tax is computed in a manner consistent with a waterâs-edge election. (2) A written notification of election is filed with the return on a form prescribed by the Franchise Tax Board. Pursuant to regulations promulgated under this section, the Franchise Tax Board may accept the filing of other objective evidence that supports the conclusion that a waterâs-edge election was intended in lieu of notification on the designated form. (b) Except as otherwise provided, a waterâs-edge election shall be effective only if made by every member of the self-assessed combined reporting group that is subject to taxation under this part. (1) An election made on a group return of a self-assessed combined reporting group shall constitute an election by each taxpayer member included in that group return, unless one of those taxpayers files a separate return in which no election is made and paragraph (2) does not apply. (2) A taxpayer that fails to make an election on its own timely filed original return shall be deemed to have elected if either of the following applies: (A) It has a parent corporation that is an electing taxpayer that included the income and apportionment factors of the nonelecting taxpayer in the self-assessed combined reporting group reflected in the electing parentâs timely filed original return, including a group return. (B) The income and apportionment factors of the nonelecting taxpayer are reflected in the self-assessed combined reporting group of a timely filed original return of an electing taxpayer, and the notification of election filed by the electing taxpayer pursuant to paragraph (2) of subdivision (a) is signed by an officer or other authorized agent of either a parent corporation of the nonelecting taxpayer or another corporation with authority to bind the nonelecting taxpayer to an election. (3) For purposes of this subdivision, a âparent corporationâ of the taxpayer is a corporation that owns or constructively owns stock possessing more than 50 percent of the voting power of the taxpayer as determined under subdivisions (e) and (f) of Section 25105. (4) If a corporation that is a member of a combined reporting group is not itself subject to taxation under this part in the year for which the waterâs-edge election is made, but subsequently becomes subject to taxation under this part, that corporation shall be deemed to have elected with the other taxpayer members of the combined reporting group. (5) If a unitary corporation not incorporated in the United States that is not itself subject to taxation under this part in the year for which the valid waterâs-edge election is made, but subsequently becomes subject to taxation under this part solely due to subdivision (b) of Section 23101 in a taxable year beginning on or after January 1, 2021, that corporation shall be deemed to have elected with the other members of the unitary combined reporting group. (6) A taxpayer that is engaged in more than one apportioning trade or business as defined in paragraph (6) of subdivision (d) of Section 25128 may make a separate election for each apportioning trade or business. (c) A waterâs-edge election shall remain in effect or be terminated in accordance with this subdivision. (1) Except as otherwise provided in this subdivision, if one or more electing taxpayer members of a combined reporting group later become disaffiliated or otherwise cease to be included in the combined reporting group, the waterâs-edge election shall remain in effect as to both the departing taxpayer members and any remaining taxpayer members. (2) If an electing taxpayer and a nonelecting taxpayer become members of a new uni
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