A handful of states (not including California) do not levy personal income tax on top of the taxes collected by the federal government. California personal income tax laws are progressive in the sense that they charge a much higher rate for high earners than for those earning relatively small incomes. For instance, those earning less than $7,581 in taxable income are only responsible for a 1 percent state income tax rate. But those earning in excess of $508,500 annually must pay a 12.3 percent tax rate. To determine rates for dual filers (such as married couples filing jointly), simply double the income numbers.
Income taxes pay for state programs and projects such as public schools and state highways. The state's Franchise Tax Board (FTB) audits the expenditures of state income tax and makes this data available to the public. In 2013, for example, 31.7 percent (the largest portion) of the state's income tax revenue went to health and human services, with 27.4 percent going to K-12 public education.
California's personal income tax rates are detailed in the table below. See State Tax Laws to learn more about California and other state taxes. Go to the "Individuals" section of the FTB's web portal to access California income tax filing instructions, download forms, calculate tax liabilities, and more.
|Code Section||Rev. & Tax Code §§17041, et seq.|
|Who is Required to File||Resident persons, including estates and trusts; nonresidents and part-year residents are liable for prorata share|
|Rate||$0 and up: 1.0%; $7,850 and up: 2.0%; $18,610 and up: 4.0%; $29,372 and up: 6.0%; $40,773 and up: 8.0%; $51,530 and up: 9.3%; $263,222 and up: 10.3%; $315,866 and up: 11.3%; $526,443 and up: 12.3%; $1,000,000 and up: 13.3% (all rates apply to single filers -- simply double the income limits for dual-filing)
|Federal Income Tax Deductible||No|
|Federal Income Used as Basis||Yes|
Note: State laws are constantly changing -- contact a California tax attorney or conduct your own legal research to verify the state law(s) you are researching.
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For some California taxpayers, filing the annual tax return is as simple as filling out a single form, signing it, and sending it to the Franchise Tax Board. But for others, it can seem like a complicated mess. If you're unsure about your state taxes, get started early by talking to an experienced tax attorney in California.
Contact a qualified attorney.