Filing California State Taxes

California has six state income tax rates. They range from 1% to 9.3%. In addition, there is a 1% surcharge on taxable incomes of more than $1 million per year.

Tax Planning

Personal Income Tax

California collects income tax from its single and married (filing separately) residents on the basis of these rates :

• You will be charged 1% on the first $6,827 of taxable income.
• You will be charged 2% percent on taxable income between $6,828 and $16,186.
• You will be charged 4% on taxable income between $16, 187 and $25,546.
• You will be charged 6% on taxable income between $25,547 and $35,463.
• You will be charged 8% on taxable income between $35,464 and $44,818.
• You will be charged 9.3% on taxable income of $44,819 and above.

The rates remain the same for head of households and married people filing joint returns but the income brackets are doubled. You must fill in forms 540EZ, Form 540A (short form), Form 540 (long form) by April 15. If there is holiday or weekend on April 15, you can submit these forms by April 16. With the help of CalFile, you can file your California taxes electronically without being charged any extra money.

Sales Tax

The sales tax rates in counties and cities with special taxing districts are comparatively high in California.

Personal and Real Estate Property Tax

All real estate property is taxable in the state of California and is normally evaluated at fair market value. Homestead exemptions are implemented at the county level. If you have any questions, immediately contact the local County Tax Assessor's office. There is a property tax postponement program in the state of California that allows eligible homeowners to postpone payment of property taxes. If you are a senior citizen or disabled you can benefit from this program.

The state of California also offers homeowner and renter assistance program. According to this program, you only need to pay annually. The qualification procedure of this program is fairly straightforward.

Other California State Taxes :

• There is no inheritance tax in the state of California.
• Estate tax has been phased out in the state, in line with federal estate tax law modifications.
• As a resident of California, you have the choice of making voluntary fund contributions to more than ten programs.
• There is no provision of intangible personal property taxes in the state.