This is sadly, absolutely correct.  Just had a client who was audited over these identical issues (though an individual, not a corporation).  Being a California based attorney, was not aware of these hidden legislative landmines.  And the fact that the administrative code has not been changed.  Even on the state's own legislative website.  Still mis-instructing taxpayers to take this subtraction - is tantamount to legislative malpractice.

Extremely frustrating.  And sending mixed messages.  To say the least.