California’s 9 state income tax rates range from 1% to 12.3%. The Golden State also assesses a 1% surcharge on taxable incomes of $1 million or more. More on California taxes can be found in the tabbed pages below.
Personal income tax
California collects income tax from its residents at the following rates.
For single and married filing separately taxpayers:
- 1% on the first $7,850 of taxable income.
- 2% on taxable income between $7,851 and $18,610.
- 4% on taxable income between $18,611 and $29,372.
- 6% on taxable income between $29,373 and $40,773.
- 8% on taxable income between $40,774 and $51,530.
- 9.3% on taxable income between $51,531 and $263,222.
- 10.3% on taxable income between $263,223 and 315,866.
- 11.3% on taxable income between $315,867 and $526,443.
- 12.3% on taxable income of $526,444 and above.
A 1% surcharge, the mental health services tax, is collected on taxable incomes of $1 million or more, making California’s highest marginal rate 13.3%.
For married people filing joint returns and heads of households, the rates remain the same, but the income brackets are doubled.
Residents must complete returns on Form 540 2EZ or Form 540. Nonresidents or part-year residents should file 540NR Short Form or 540NR Long Form. The deadline for all forms is April 15. When that date falls on a weekend or holiday, filers get until the next business day to submit their state returns.
California’s previous free filing option, Ready Return, has been rolled into CalFile.
California’s minimum combined state, county and local sales and use tax rate increased to 7.5% (6.5% state-only portion and 1% collected by localities) on Jan. 1, 2013, due to voter approval in November 2012 of Proposition 30.
Rates will be higher in cities and counties with special taxing districts. Publication 71 lists combined sales tax rates for California cities and counties.
Many business owners believe gift wrapping is a nontaxable service. However, unless it is food products that were sold in a nontaxable transaction, sales tax generally applies to gift-wrapping charges. Publication 106 contains more information.
Personal and real property taxes
In the state of California, all real property is taxable and shall be assessed at fair market value.
Any homestead exemptions are handled at the county level, and residents must contact the local county tax assessor’s office to inquire.
The state’s property tax postponement program allows eligible homeowners (senior citizens and blind or disabled residents) to postpone payments of property taxes on their principal places of residence. Applications may be filed with the state controller’s office beginning Sept. 1, 2016. Some California counties also may offer a property tax postponement program for properties located in the county.
California previously offered a homeowner and renter assistance program under which a once-a-year payment was made to qualified individuals based on part of the property taxes assessed and paid on their homes or paid indirectly as part of their rent. However, this program was suspended due to budget constraints.
Check the state’s homeowner and renter assistance program Web page periodically for program updates.
Inheritance and estate taxes
California has no inheritance tax, and its estate tax has been phased out in connection with federal estate tax law changes. Executors of estates of people who died on or after Jan. 1, 2005, are no longer required to file a California estate tax return.
There is no inheritance tax in California.
Other California tax facts
California taxpayers can check the status of their refunds by using the state’s interactive Web page.
No intangible personal property taxes are levied in California.
For more information, go to the California Franchise Tax Board’s website or call (800) 852-5711 toll-free.
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