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This article was fact-checked by our editors and Christina Taylor, MBA, senior manager of tax operations for Credit Karma Tax®. It has been updated for the 2019 tax year.
Californians love a lot of things about their state, but few probably include state taxes on their list of likes about the Golden State.
California taxes the personal income of its residents to fund government operations and programs, like health and human services, as well as education. The cost for all those services is a state and local tax burden that the Tax Foundation says ranks as the sixth-highest in the nation.
If you’re looking for tips on how to file your California state tax return, here is helpful information.
- The basics of California state tax
- California deductions, adjustments and credits to know
- How to file your California state tax return
- Tracking your California tax refund
The basics of California state tax
The California Franchise Tax Board administers tax laws and collects taxes, including personal income tax, in California. The department’s general information number is 1-800-852-5711. There’s also a live chat for general questions.
Filing and payment deadline
For 2019 state taxes, the state has extended the filing and payment deadline. California residents now have until July 15, 2020 to file their state returns and pay any state tax they owe. As with the federal deadline extension, California won’t charge interest on unpaid balances between April 15 and July 15, 2020.
You don’t need to do anything to get this extension. It’s automatic for all California taxpayers. But keep in mind that if you’re expecting a refund, you might want to go ahead and file as soon as possible. During the coronavirus crisis, the state is continuing to process tax returns and issue refunds.
While this year is a little different, generally, California’s Tax Day is the same as the deadline for filing your federal income tax return — April 15. However, if the 15th falls on a Sunday or holiday, the deadline may be extended.
California recognizes the following federal filing statuses:
- Married filing jointly
- Married filing separately
- Head of household
- Qualifying widow(er)
Additionally, California recognizes registered domestic partnerships and accepts either joint or separate returns from couples in those partnerships.
Generally, you must use the same filing status on your California state tax return as you do on your federal return, unless you’re in a registered domestic partnership and had to file as single on your federal return. In that case, you would need to file as married (either jointly or separately) on your California state return.
California income tax rates
For 2019, California has income tax brackets that range from 1% to 12.30%. As with federal income tax rates, more than one California tax rate could apply to your income. The highest tax bracket that applies to your income determines your marginal tax rate.
California deductions, adjustments and credits to know
California standard deduction
In California, you can either take a standard deduction or itemize your tax deductions. If you’re married, or a registered domestic partner and filing separately, you and your spouse/registered domestic partner must either both itemize or both take the standard deduction.
Here are the standard deductions for most people by filing status in 2018.
- Single: $4,537
- Married/RDP filing joint return: $9,074
- Married/RDP filing separately: $4,537
- Head of household: $9,074
- Qualifying widow(er): $9,074
California allows personal exemptions of $122 each for taxpayers and their spouses, and $378 for up to three qualifying dependents. There are additional exemption amounts for filers and spouses (or registered domestic partners) who are blind or 65 or older.
Adjustments and deductions
- Mortgage interest deduction: Federal law caps at $750,000 the amount of home acquisition debt for which a married couple filing jointly can deduct interest on a loan taken out in 2018. The limit is $375,000 for couples who are married filing separately. If your mortgage interest amount exceeded the federal limit, you may be able to deduct the amount over the federal limit on your California state tax return.
- Health savings account distributions: If you had a tax-free HSA distribution for qualified medical expenses, you may be able to take a deduction for the portion of those expenses that exceed 7.5% of your federal adjusted gross income. Additionally, if you took an HSA distribution for a nonqualified medical expense and had to include that sum in your federal taxable income, the amount is not taxable on your California state tax return. However, your contributions to an HSA are not deductible for California state tax purposes.
- Mortgage interest credit deduction: If you took a mortgage interest deduction on your federal return and had to reduce the deduction by the amount of your mortgage interest credit, you may be able to deduct the amount of the federal mortgage interest credit on your California state tax return.
- California lottery winnings: If you win money playing the California lottery, you don’t have to pay state income tax on it! California excludes its state lottery winnings from taxable income.
California state tax credits
Available California tax credits include the following:
- Child adoption costs: 50% of qualified costs for a qualified adoption in the year an adoption is begun.
- College access tax credit: 50% of contributions to the College Access Tax Credit Fund, California’s Cal Grants financial aid program.
- Earned income tax credit: Similar to the federal earned income tax credit, California’s credit is intended for lower-income working people. If your income qualifies you, the amount of the credit depends on your income and the number of qualifying children you have.
How to file your California state tax return
You have multiple options for tax preparation, filing and paying your California state income tax.
- E-file and pay for free with CalFile through the Franchise Tax Board’s website. You’ll need to create an account.
- File for free through an online tax-filing service like Credit Karma Tax®. But if your filing status is married filing separately, you won’t be able to use Credit Karma Tax® to prepare your California state tax return.
- E-file through a fee-based tax-filing service.
- Download forms through the FTB website. You can complete and mail these forms to the Franchise Tax Board, PO Box 942840, Sacramento, CA 94240-0001, if no balance is due or you’re owed a refund. If you’re filing with a payment, mail it to PO Box 942867, Sacramento, CA 94267-0001.
If you owe and can’t pay
If you can’t pay your tax bill and it’s less than $25,000, you may be able to set up an installment agreement. You can apply online, by phone or mail. There’s a $34 set-up fee, and 60 months is the maximum payment term.
Keep in mind that even with a payment plan, interest and penalties will continue to accrue until you pay your bill in full.
Tracking your California tax refund
Like the IRS, California has a tool to help you track your refund. Math errors, incorrect forms, missing or incomplete information, the need for extra review for accuracy or identity theft can all delay your refund.
Living in the Golden State, where gold was discovered in 1848, doesn’t come cheap. California has one of the highest state income tax rates in the U.S. Make sure you file by the deadline, and if you’re due a refund, you can anticipate receiving it within two weeks if you e-file or four weeks if you file by paper.
Christina Taylor is senior manager of tax operations for Credit Karma Tax®. She has more than a dozen years of experience in tax, accounting and business operations. Christina founded her own accounting consultancy and managed it for more than six years. She co-developed an online DIY tax-preparation product, serving as chief operating officer for seven years. She is the current treasurer of the National Association of Computerized Tax Processors and holds a bachelor’s in business administration/accounting from Baker College and an MBA from Meredith College. You can find her on LinkedIn.