California Form 540 Instructions
Before You Begin
Complete your federal income tax return (Form 1040, Form 1040A, or Form 1040EZ) before you begin your California Form 540. Use information from your federal income tax return to complete your Form 540. Complete and mail Form 540 by April 15, 2014. If unable to mail your tax return by the due date, see page 2.
Tip: You may qualify for the federal earned income credit. See page 2 for more information. No comparable state credit exists.
Note: The lines on Form 540 are numbered with gaps in the line number sequence. For example, lines 20 through 30 do not appear on Form 540, so the line number that follows line 19 on Form 540 is line 31.
Caution: Form 540 has five sides. When filing Form 540, you must send all five sides to the Franchise Tax Board (FTB).
Filling in Your Tax Return
- Use black or blue ink on the tax return you send to the FTB.
- Enter your social security number(s) (SSN) or individual taxpayer identification number(s) (ITIN) at the top of Form 540, Side 1.
- Print numbers and CAPITAL LETTERS between the combed lines. Be sure to line up dollar amounts.
- If you do not have an entry for a line, leave it blank unless the instructions for a line specifically tell you to enter -0-. Do not enter a dash, or the word "NONE."
Name(s) and Address
Print your first name, middle initial, last name, and street address in the spaces provided at the top of the form.
Additional Information . Use the Additional Information field for "In-Care-Of" name and other supplemental address information only.
Foreign Address . If you have a foreign address enter the city, foreign country name, foreign province/state/county name, and foreign postal code in the appropriate boxes. Do not abbreviate the foreign country name. Follow the country's practice for entering the province/state/county name and foreign postal code.
Principal Business Activity (PBA) Code. For federal Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship) business filers, enter the numeric PBA code from federal Schedule C (Form 1040), line B.
Date of Birth (DOB) . Enter your DOBs (mm/dd/yyyy) in the spaces provided. If your filing status is married/RDP filing jointly or married/RDP filing separately, enter the DOBs in the same order as the names.
Prior Name. If you or your spouse/RDP filed your 2012 tax return under a different last name, write the last name only from the 2012 tax return.
Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN)
Enter your SSN in the spaces provided. If filing a joint tax return, enter the SSNs in the same order as the names.
If you do not have an SSN because you are a nonresident or resident alien for federal tax purposes, and the Internal Revenue Service (IRS) issued you an ITIN, enter the ITIN in the space for the SSN. An ITIN is a tax processing number issued by the IRS to foreign nationals and others who have a federal tax filing requirement and do not qualify for an SSN. It is a nine-digit number that always starts with the number 9.
Filing Status
Line 1 through Line 5 - Filing Status
Check only one box for line 1 through line 5. Enter the required additional information if you checked the box on line 3 or line 5. For filing status requirements, see page 3.
Use the same filing status for California that you used for your federal income tax return.
Exception: If you file a joint tax return for federal, you may file separately for California if either spouse was:
- An active member of the United States armed forces or any auxiliary military branch during 2013.
- A nonresident for the entire year and had no income from California sources during 2013.
Caution - Community Property States: If the spouse earning the California source income is domiciled in a community property state, community income will be split equally between the spouses. Both spouses will have California source income and they will not qualify for thenonresident spouse exception.
If you had no federal filing requirement, use the same filing status for California you would have used to file a federal income tax return.
Registered domestic partners (RDPs) who file single for federal must file married/RDP filing jointly or married/RDP filing separately for California. If you are an RDP and file head of household for federal purposes, you may file head of household for California purposes only if you meet the requirements to be considered unmarried or considered not in a domestic partnership.
If you filed a joint tax return and either you or your spouse/RDP was a nonresident for 2013, you must file the Long or Short Form 540NR, California Nonresident or Part-Year Resident Income Tax Return.
Exemptions
Line 6 - Can be Claimed as Dependent
601 - Check the box on line 6 if someone else can claim you or your spouse/RDP as a dependent on their tax return, even if they chose not to.
Line 7 - Personal Exemptions
Did you check the box on line 6?
No. Follow the instructions on line 7.
Yes. Ignore the instructions on line 7. Instead, enter in the box on line 7 the amount shown below for your filing status:
- Single or married/RDP filing separately, enter -0-.
- Head of household, enter -0-.
- Married/RDP filing jointly and both you and your spouse/RDP can be claimed as dependents, enter -0-.
- Married/RDP filing jointly and only one spouse/RDP can be claimed as a dependent, enter 1.
Do not claim this credit if someone else can claim you as a dependent on their tax return.
Line 8 - Blind Exemptions
The first year you claim this exemption credit, attach a doctor's statement to the back of Form 540 indicating you or your spouse/RDP are visually impaired. Visually impaired means not capable of seeing better than 20/200 while wearing glasses or contact lenses, or if your field of vision is not more than 20 degrees.
Do not claim this credit if someone else can claim you as a dependent on their tax return.
Line 9 - Senior Exemptions
If you were 65 years of age or older by December 31, 2013,* you should claim an additional exemption credit on line 9. If you are married or an RDP, each spouse/RDP 65 years of age or older should claim an additional credit. You may contribute all or part of this credit to the California Seniors Special Fund. See page 23 for information about this fund.
*If your 65th birthday is on January 1, 2014, you are considered to be age 65 on December 31, 2013.
Do not claim this credit if someone else can claim you as a dependent on their tax return.
Line 10 - Dependent Exemptions
To claim an exemption credit for each of your dependents, write each dependent's first and last name and relationship to you in the space provided. If you are claiming more than four dependents, attach a statement with the required dependent information to your tax return. Count the number of dependents listed and enter the total in the box on line 10. Multiply the number you entered by the pre-printed dollar amount and enter the result.
Line 11 - Exemption Amount
Add line 7 through line 10 and enter the total dollar amount of all exemptions for personal, blind, senior, and dependent.
Taxable Income
Refer to your completed federal income tax return to complete this section.
Line 12 - State Wages
204 - Enter the total amount of your state wages from all states from each of your Form(s) W-2, Wage and Tax Statement. This amount appears on Form W-2, box 16.
If you received wages and do not have a Form W-2, see "Attachments to your tax return" on page 16.
Line 13 - Federal Adjusted Gross Income (AGI) from Form 1040, line 37; 1040A, line 21; or 1040EZ, line 4
RDPs who file a California tax return as married/RDP filing jointly and have no RDP adjustments between federal and California, combine their individual AGIs from their federal tax returns filed with the IRS. Enter the combined AGI on line 13.
RDP adjustments include but are not limited to the following:
- Transfer of property between spouses/RDPs
- Capital loss
- Transactions between spouses/RDPs
- Sale of residence
- Dependent care assistance
- Investment interest
- Qualified residence interest acquisition loan & equity loan
- Expense depreciation property limits
- Individual Retirement Account
- Interest education loan
- Rental real estate passive loss
- Rollover of publicly traded securities gain into specialized small business investment companies
RDPs filing as married/RDP filing separately, former RDPs filing separately, and RDPs with RDP adjustments will use the California RDP Adjustments Worksheet in FTB Pub. 737, Tax Information for Registered Domestic Partners, or complete a federal pro forma Form 1040. Transfer the amount from the California RDP Adjustments Worksheet, line 37, column D, or federal pro forma Form 1040, line 37, to Form 540, line 13.
Line 14 - California Adjustments - Subtractions [from Schedule CA (540), line 37, column B]
If there are no differences between your federal and California income or deductions, do not file a Schedule CA (540), California Adjustments - Residents.
If there are differences between your federal and California income or deductions, complete Schedule CA (540). Follow the instructions for Schedule CA (540) beginning on page 33. Enter on line 14 the amount from Schedule CA (540), line 37, column B. If a negative amount, see Schedule CA (540), line 37 instructions, page 37.
Line 15 - Subtotal
Subtract the amount on line 14 from the amount on line 13. Enter the result on line 15. If the amount on line 13 is less than zero, combine the amounts on line 13 and line 14 and enter the result in parentheses. For example: "(12,325)."
Line 16 - California Adjustments - Additions [from Schedule CA (540), line 37, column C]
If there are differences between your federal and California income or deductions, complete Schedule CA (540). Follow the instructions for Schedule CA (540) beginning on page 33. Enter on line 16 the amount from Schedule CA (540), line 37, column C. If a negative amount, see Schedule CA (540), line 37 instructions, page 37.
Line 18 - California Itemized Deductions or California Standard Deduction
Decide whether to itemize your charitable contributions, medical expenses, mortgage interest paid, taxes, etc., or take the standard deduction. Your California income tax will be less if you take the larger of:
- Your California itemized deductions.
- Your California standard deduction.
California itemized deductions may be limited based on federal AGI. To compute limitations, use Schedule CA (540). RDPs use your recalculated federal AGI to figure your itemized deductions.
On federal tax returns, individual taxpayers who claim the standard deduction are allowed an additional deduction for net disaster losses. For California, deductions for disaster losses are only allowed for those individual taxpayers who itemized their deductions.
If married or an RDP and filing separate tax returns, you and your spouse/ RDP must either both itemize your deductions (even if the itemized deductions of one spouse/RDP are less than the standard deduction) or both take the standard deduction.
If someone else can claim you as a dependent, you may claim the greater of the standard deduction or your itemized deductions. To figure your standard deduction, use the Form 540 - California Standard Deduction Worksheet for Dependents on page 9.
Itemized deductions. Figure your California itemized deductions by completing Schedule CA (540), Part II, line 38 through line 44. Enter the result on Form 540, line 18.
If you did not itemize deductions on your federal income tax return but will itemize deductions for your Form 540, first complete federal Schedule A (Form 1040), Itemized Deductions. Then complete Schedule CA (540), Part II, line 38 through line 44. Attach both the federal Schedule A (Form 1040) and California Schedule CA (540) to the back of your tax return.
Standard deduction. Find your standard deduction on the California Standard Deduction Chart for Most People on this page. If you checked the box on Form 540, line 6, use the California Standard Deduction Worksheet for Dependents on page 9.
California Standard Deduction Chart for Most People
Do not use this chart if your parent, or someone else, can claim you (or your spouse/RDP) as a dependent on their tax return.
Your Filing Status Enter On Line 18
| Your Filing Status | Enter On Line 18 |
| 1 - Single . . . . . . . . . | $3,906 |
| 2 - Married/RDP filing jointly . . . | $7,812 |
| 3 - Married/RDP filing separately . . | $3,906 |
| 4 - Head of household . . . . . . . . | $7,812 |
| 5 - Qualifying widow(er) . . . . . | $7,812 |
The California standard deduction amounts are less than the federal standard deduction amounts.
California Standard Deduction Worksheet for Dependents
Use this worksheet only if your parent, or someone else, can claim you (or your spouse/RDP) as a dependent on their return. Use whole dollars only.
| 1. Enter your earned income from: line 1 of the "Standard Deduction Worksheet for Dependents'' in the instructions for federal Form 1040; Form 1040A; or from line A of the worksheet on the back of Form 1040EZ. |
______
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| 2. Minimum standard deduction |
$1,000.00
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| 3. Enter the larger of line 1 or line 2 here |
______
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4. Enter the amount shown for your filing status
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______
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| 5. Standard deduction. Enter the smaller of line 3 or line 4 here and on Form 540, line 18 |
______
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Line 19 - Taxable Income
Capital Construction Fund (CCF). If you claim a deduction on your federal Form 1040, line 43 for the contribution made to a capital construction fund set up under the Merchant Marine Act of 1936, reduce the amount you would otherwise enter on line 19 by the amount of the deduction. Next to line 19, enter "CCF" and the amount of the deduction. For details, see federal Publication 595, Capital Construction Fund for Commercial Fishermen.
Tax
When figuring your tax, use the correct filing status and taxable income amount.
Line 31 - Tax
To figure your tax, use one of the following methods and check the matching box on line 31:
- Tax Table. If your taxable income on line 19 is $100,000 or less, use the tax table beginning on page 59. Use the correct filing status column in the tax table.
- Tax Rate Schedules. If your taxable income on line 19 is over $100,000, use the tax rate schedule for your filing status on page 64.
- FTB 3800. Generally, use form FTB 3800, Tax Computation for Certain Children with Investment Income, to figure the tax on a separate Form 540 for your child who was 18 and under or a student under age 24 on January 1, 2014, and who had more than $2,000 of investment income. Attach form FTB 3800 to the child's Form 540.
- FTB 3803. If, as a parent, you elect to report your child's interest and dividend income of $10,000 or less (but not less than $1,000) on your tax return, complete form FTB 3803, Parents' Election to Report Child's Interest and Dividends. File a separate form FTB 3803 for each child whose income you elect to include on your Form 540. Add the amount of tax, if any, from each form FTB 3803, line 9, to the amount of your tax from the tax table or tax rate schedules and enter the result on Form 540, line 31. Attach form(s) FTB 3803 to your tax return.
To prevent possible delays in processing your tax return or refund, enter the correct tax amount on this line. To automatically figure your tax or to verify your tax calculation, use our online tax calculator. Go to ftb.ca.gov and search for tax calculator.
Tip: CalFile or e-file and you won't have to do the math. Go to ftb.ca.gov and search for efile.
Line 32 - Exemption Credits
Exemption credits reduce your tax. If your federal adjusted gross income (AGI) on line 13 is more than the amount shown below for your filing status, your credits will be limited.
For purposes of computing limitations based upon AGI, RDPs, recalculate their AGI using a federal pro forma or California RDP Adjustments Worksheet (located in FTB Pub. 737). If your recalculated federal AGI is more than the amount shown below for your filing status, your credits will be limited.
| If your filing status is: | Is Form 540/540A, line 13 more than: |
| Single or married/RDP filing separately . . . | $172,615 |
| Married/RDP filing jointly or qualifying widow(er) . | $345,235 |
| Head of household . | $258,927 |
Yes. Complete the AGI Limitation Worksheet below.
No. Follow the instructions on Form 540, line 32.
AGI Limitation Worksheet
Use whole dollars only.
| a Enter the amount from line 13 |
______
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b Enter the amount for your filing status on line b:
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______
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| c Subtract line b from line a . |
______
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| d Divide line c by $2,500 ($1,250 if married/RDP filing separately). If the result is not a whole number, round it to the next higher whole number |
______
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| e Multiply line d by $6 |
______
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| f Add the numbers from the boxes on lines 7, 8, and 9 (not the dollar amounts) |
______
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| g Multiply line e by line f |
______
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| h Add the total dollar amount from lines 7, 8, and 9 |
______
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| i Subtract line g from line h. If zero or less, enter -0- |
______
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| j Enter the number from the box on line 10 (not the dollar amount) |
______
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| k Multiply line e by line j |
______
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| l Enter the dollar amount from line 10 |
______
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| m Subtract line k from line l. If zero or less, enter -0- |
______
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| n Add line i and line m. Enter the result here and on line 32 |
______
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Line 34 - Tax from Schedule G-1 and Form FTB 5870A
If you received a qualified lump-sum distribution in 2013 and you were born before January 2, 1936, get Schedule G-1, to figure your tax by special methods that may result in less tax.
If you received accumulation distributions from foreign trusts or from certain domestic trusts, get form FTB 5870A, Tax on Accumulation Distribution of Trusts, to figure the additional tax.
To get these forms, see "Order Forms and Publications" on page 67.
Special Credits and Nonrefundable Credits
A variety of California tax credits are available to reduce your tax if you qualify. To figure and claim most special credits, you must complete a separate form or schedule and attach it to your Form 540. The Credit Chart on page 22 describes the credits and provides the name, credit code, and number of the required form or schedule. Many credits are limited to a certain percentage or a certain dollar amount. In addition, the total amount you may claim for all credits is limited by tentative minimum tax (TMT); go to Box A to see if your credits are limited.
If you are not claiming any special credits go to line 40 and line 46 to see if you qualify for the nonrefundable child and dependent care expenses credit or the nonrefundable renter's credit.
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Box A - Did you complete federal Schedule C, D, E, or F and claim or receive any of the following (Note: If your business gross receipts are less than $1,000,000 from all trades or businesses, you do not have to report alternative minimum tax (AMT). For more information, see line 61 instructions, on page 11.):
Yes. Complete Schedule P (540). See "Order Forms and Publications" on page 67. No. Go to Box B. |
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Box B - Did you claim or receive any of the following:
Yes. Complete Schedule P (540). See "Order Forms and Publications" on page 67. No. Go to Box C. |
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Box C - If your filing status is: Is Form 540, line 17 more than: Single or head of household . . . . . . . . . . . . . . . . . . . . . . . $238,051 Married/RDP filing jointly or qualifying widow(er) . . . . . . .$317,401 Married/RDP filing separately . . . . . . . . . . . . . . . . . . . . . .$158,700 Yes. Complete Schedule P (540). See "Order Forms and Publications" on page 67. No. Your credits are not limited. Go to the instructions for line 40. |
Line 40 - Nonrefundable Child and Dependent Care Expenses Credit
Claim this credit if you paid someone to care for your qualifying child under the age of 13, other dependent who is physically or mentally incapable of caring for him or herself, or spouse/RDP if physically or mentally incapable of caring for him or herself. The care must be provided in California. To claim this credit, your federal AGI must be $100,000 or less and you must complete and attach form FTB 3506, Child and Dependent Care Expenses Credit, included in this booklet.
Line 41 and Line 42 - New Jobs Credit
Qualified employers who had a net increase of qualified employees during the current taxable year or qualified employers who first commenced business in California during the current taxable year may be eligible to claim this credit. Use form FTB 3527, New Jobs Credit, to determine the amount of the credit available. Enter on line 41 the amount of the credit generated from form FTB 3527, line 18.
Answer the following question to determine the amount of the credit you can claim. Are you required to complete Schedule P (540)?
Yes. Enter on line 42 the amount of the New Jobs credit claimed from Schedule P (540), Part III.
No. Use this worksheet to figure the credit.
| 1. Enter the amount from Form 540, line 35. |
______
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| 2. Enter the amount from form FTB 3527, line 21 |
______
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| 3. Enter the smaller of line 1 or line 2 here and on Form 540, line 42* and form FTB 3527, line 22a |
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* If you have other credits with limited carryovers, you may want to apply those credits first on line 43 through line 45 before claiming the New Jobs credit on line 42.
Important: Attach form FTB 3527 and Schedule P (540) to your Form 540.
Line 43 through Line 45 - Additional Special Credits
A code identifies each credit. To claim only one or two credits, enter the credit name, code, and amount of the credit on line 43 and line 44.
To claim more than two credits, use Schedule P (540), Part III. See Schedule P (540) instructions, "How to Claim Your Credits."
Do not claim the New Jobs credit on line 43, line 44, or line 45. Only use line 42 to claim the New Jobs credit.
Important: Attach Schedule P (540) and any supporting schedules or statements to your Form 540.
Carryovers: If you claim a credit with carryover provisions and the amount of the credit available this year exceeds your tax, carry over any excess credit to future years until the credit is used (unless the carryover period is a fixed number of years). If you claim a credit carryover for an expired credit, use form FTB 3540, Credit Carryover and Recapture Summary, to figure the amount of the credit. Otherwise, enter the amount of the credit on Schedule P (540), Part III, and do not attach form FTB 3540.
Credit for Joint Custody Head of Household - Code 170
You may not claim this credit if you used the married/RDP filing jointly, head of household, or qualifying widow(er) filing status.
Claim the credit if unmarried and not an RDP at the end of 2013 (or if married/or an RDP, you lived apart from your spouse/RDP for all of 2013 and you used the married/RDP filing separately filing status); and if you furnished more than one-half the household expenses for your home that also served as the main home of your child, step-child, or grandchild for at least 146 days but not more than 219 days of the taxable year. If the child is married or an RDP, you must be entitled to claim a dependent exemption credit for the child.
Also, the custody arrangement for the child must be part of a decree of dissolution or legal separation or part of a written agreement between the parents where the proceedings have been initiated, but a decree of dissolution or legal separation has not yet been issued.
Use the worksheet below to figure the Joint Custody Head of Household credit using whole dollars only.
| 1. Enter the amount from Form 540, line 35 . |
______
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| 2. Credit percentage - 30% . |
___ x.30
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| 3. Credit amount. Multiply line 1 by line 2. Enter the result or $416, whichever is less . |
______
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If you qualify for the Credit for Joint Custody Head of Household and the Credit for Dependent Parent, claim only one credit. Select the credit that allows the maximum benefit.
Credit for Dependent Parent - Code 173
You may not claim the Credit for Dependent Parent if you used the single, head of household, qualifying widow(er), or married/RDP filing jointly filing status.
Claim this credit only if all of the following apply:
- You were married/or an RDP at the end of 2013 and you used the married/RDP filing separately filing status.
- Your spouse/RDP was not a member of your household during the last six months of the year.
- You furnished over one-half the household expenses for your dependent mother's or father's home, whether or not she or he lived in your home.
To figure the amount of this credit, use the worksheet above for the Credit for Joint Custody Head of Household. If you qualify for the Credit for Joint Custody Head of Household and the Credit for Dependent Parent, claim only one. Select the credit that will allow the maximum benefit.
Credit for Senior Head of Household - Code 163
You may claim this credit if you:
- Were 65 years of age or older on December 31, 2013.*
- Qualified as a head of household in 2011 or 2012 by providing a household for a qualifying individual who died during 2011 or 2012.
- Did not have AGI over $67,520 for 2013.
* If your 65th birthday is on January 1, 2014, you are considered to be age 65 on December 31, 2013.
If you meet all the conditions listed above, you do not need to qualify to use the head of household filing status for 2013 in order to claim this credit.
Use this worksheet to figure this credit using whole dollars only.
| 1. Enter the amount from Form 540, line 19 |
________
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| 2. Credit percentage - 2% . |
____ x .02
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| 3. Credit amount. Multiply line 1 by line 2. Enter the result or $1,272, whichever is less |
________
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Credit for Child Adoption Costs - Code 197
For the year in which an adoption decree or an order of adoption is entered (e.g., adoption is final), claim a credit for 50% of the cost of adopting a child who was both:
- A citizen or legal resident of the United States.
- In the custody of a California public agency or a California political subdivision.
Treat a prior unsuccessful attempt to adopt a child (even when the costs were incurred in a prior year) and a later successful adoption of a different child as one effort when computing the cost of adopting the child. Include the following costs if directly related to the adoption process:
- Fees for Department of Social Services or a licensed adoption agency.
- Medical expenses not reimbursed by insurance.
- Travel expenses for the adoptive family.
Note:
- This credit does not apply when a child is adopted from another country or another state, or was not in the custody of a California public agency or a California political subdivision.
- Any deduction for the expenses used to claim this credit must be reduced by the amount of the child adoption costs credit claimed.
Use the worksheet below to figure this credit using whole dollars only. If more than one adoption qualifies for this credit, complete a separate worksheet for each adoption. The maximum credit is limited to $2,500 per minor child.
| 1. Enter qualifying costs for the child |
______
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| 2. Credit percentage - 50% |
___ x.50
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| 3. Credit amount. Multiply line 1 by line 2. Do not enter more than $2,500 . |
______
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Your allowable credit is limited to $2,500 for 2013. Carry over the excess credit to future years until the credit is used.
Line 46 - Nonrefundable Renter's Credit
If you paid rent for at least six months in 2013 on your principal residence located in California you may qualify to claim the nonrefundable renter's credit which may reduce your tax. Complete the qualification record on page 19.
Line 48
Subtract the amount on line 47 from the amount on line 35. Enter the result on line 48. If the amount on line 47 is more than the amount on line 35, enter -0-. If you owe interest on deferred tax from installment obligations, include the additional tax, if any, in the amount you enter on line 48. Write "IRC Section 453 interest" or "IRC Section 453A interest" and the amount on the dotted line to the left of the amount on line 48.
Other Taxes
Attach the specific form or statement required for each item below.
Line 61 - Alternative Minimum Tax (AMT)
If you claim certain types of deductions, exclusions, and credits, you may owe AMT if your total income is more than:
- $84,640 married/RDP filing jointly or qualifying widow(er)
- $63,481 single or head of household
- $42,319 married/RDP filing separately
A child under age 19 or a student under age 24 may owe AMT if the sum of the amount on line 19 (taxable income) and any preference items listed on Schedule P (540) and included on the return is more than the sum of $7,150 and the child's earned income.
AMT income does not include income, adjustments, and items of tax preference related to any trade or business of a qualified taxpayer who has gross receipts, less returns and allowances, during the taxable year of less than $1,000,000 from all trades or businesses.
Get Schedule P (540) for more information. See "Order Forms and Publications" on page 67.
Line 62 - Mental Health Services Tax
If your taxable income is more than $1,000,000, compute the Mental Health Services Tax using whole dollars only:
| 1. Taxable income from line 19 |
_________
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| 2. Less . |
$(1,000,000)
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| 3. Subtotal |
_________
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| 4. Tax rate - 1% |
______x .01
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| 5. Mental Health Services Tax - Multiply line 3 by line 4. Enter this amount here and on line 62 |
_________
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Line 63 - Other Taxes and Credit Recapture
If you received an early distribution of a qualified retirement plan and were required to report additional tax on your federal tax return, you may also be required to report additional tax on your California tax return. Get form FTB 3805P, Additional Taxes on Qualified Plans (including IRAs) and Other Tax-Favored Accounts. If required to report additional tax, report it on line 63 and write "FTB 3805P" to the left of the amount.
California conforms to federal law for income received under IRC Section 409A on a nonqualified deferred compensation (NQDC) plan and discounted stock options and stock appreciation rights. Income received under IRC Section 409A is subject to an additional 5% tax of the amount required to be included in income plus interest. Include the additional tax, if any, on line 63. Write "NQDC" on the dotted line to the left of the amount.
If you used form(s)
- FTB 3540, Credit Carryover and Recapture Summary
- FTB 3805Z, Enterprise Zone Deduction and Credit Summary
- FTB 3807, Local Agency Military Base Recovery Area Deduction and Credit Summary
- FTB 3808, Manufacturing Enhancement Area Credit Summary
- FTB 3809, Targeted Tax Area Deduction and Credit Summary
Include the additional tax for credit recapture, if any, on line 63. Write the form number on the dotted line to the left of the amount on line 63.
If you are required to recapture any prior year New Home Credit, include the additional tax on line 63. Write "FTB 3549-A" on the dotted line to the left of the amount on line 63. Get FTB Pub. 3549, New Home/First-Time Buyer Credit, for more information.
Payments
To avoid a delay in the processing of your tax return, enter the correct amounts on line 71 through line 74.
Line 71 - California Income Tax Withheld
Enter the total California income tax withheld from your:
- Form(s) W-2, Wage and Tax Statement, box 17
- Form(s) W-2G, Certain Gambling Winnings, box 15
- Form(s) 1099-DIV, Dividends and Distributions, box 14
- Form(s) 1099-INT, Interest Income, box 13
- Form(s) 1099-MISC, Miscellaneous Income, box 16
- Form(s) 1099-OID, Original Issue Discount, box 10
- Form(s) 1099-R, Distributions from Pensions, Annuities, Retirement, or Profit Sharing Plans, IRAs, Insurance Contracts, etc., box 12
Do not include city, local, or county tax withheld, tax withheld by other states,or nonconsenting nonresident (NCNR) member's tax from Schedule K-1 (568), line 15e. Do not include withholding from Forms 592-B, Resident and Nonresident Withholding Tax Statement, or Form 593, Real Estate Withholding Tax Statement, on this line. For more details, see instructions for line 73 on page 12.
Generally, tax should not be withheld on federal Form 1099-MISC. If you want to pre-pay tax on income reported on federal Form 1099-MISC, use Form 540-ES, Estimated Tax for Individuals.
Line 72 - 2013 CA Estimated Tax and Other Payments
Enter the total of any:
- California estimated tax payments you made using 2013 Form 540-ES, electronic funds withdrawal, Web Pay, or credit card.
- Overpayment from your 2012 California income tax return that you applied to your 2013 estimated tax.
- Payment you sent with form FTB 3519, Payment for Automatic Extension for Individuals.
- California estimated tax payments made on your behalf by an estate, trust, or S corporation on Schedule K-1 (541) or Schedule K-1 (100S).
Tip: To view payments made or get your current account balance, go to ftb.ca.gov and search for myftb account.
If you and your spouse/RDP paid joint estimated taxes but are now filing separate income tax returns, either of you may claim the entire amount paid, or each may claim part of the joint estimated tax payments. If you want the estimated tax payments to be divided, notify the FTB before you file the tax returns so the payments can be applied to the proper account. The FTB will accept in writing, any divorce agreement (or court-ordered settlement) or a statement showing the allocation of the payments along with a notarized signature of both taxpayers.
Send statements to:
JOINT ESTIMATED CREDIT ALLOCATION MS F225
TAXPAYER SERVICES CENTER
FRANCHISE TAX BOARD
PO BOX 942840
SACRAMENTO, CA 94240-0040
If you or your spouse/RDP made separate estimated tax payments, but are now filing a joint income tax return, add the amounts you each paid. Attach a statement to the front of Form 540 explaining that payments were made under both SSNs.
You do not have to make estimated tax payments if you are a nonresident or new resident of California in 2014 and did not have a California tax liability in 2013.
Line 73 - Real Estate and Other Withholding
Enter the total of California withholding from Form 593, Real Estate Withholding Tax Statement, and Form 592-B, Resident and Nonresident Withholding Tax Statement. Attach a copy of Form(s) 593 and 592-B to the lower front of Form 540, Side 1.
Caution: Do not include withholding from federal Form(s) W-2, W-2G, or 1099, or NCNR member's tax from Schedule K-1 (568), line 15e on this line.
Line 74 - Excess California SDI (or VPDI) Withheld
You may claim a credit for excess State Disability Insurance (SDI) or Voluntary Plan Disability Insurance (VPDI) if you meet all of the following conditions:
- You had two or more California employers during 2013.
- You received more than $100,880 in wages.
- The amounts of SDI (or VPDI) withheld appear on your Form(s) W-2. Be sure to attach your Form(s) W-2 to the lower front of your Form 540.
If SDI (or VPDI) was withheld from your wages by a single employer, at more than 1.0% of your gross wages, you may not claim excess SDI (or VPDI) on your Form 540. Contact the employer for a refund.
To determine the amount to enter on line 74, complete the Excess SDI (or VPDI) Worksheet below. If married/RDP filing jointly, figure the amount of excess SDI (or VPDI) separately for each spouse/RDP.
Excess SDI (or VPDI) Worksheet
Use whole dollars only.
Follow the instructions below to figure the amount of income tax to enter on Form 540, line 74. If you are married/RDP and file a joint return, you must figure the amount of excess SDI (or VPDI) separately for each spouse/RDP.
|
You |
Your Spouse/RDP |
|
| 1. Add amounts of SDI (or VPDI) withheld shown on your Forms W-2. Enter the total here | ||
| 2. 2013 SDI (or VPDI) limit |
$1,008.80 |
$1,008.80 |
|
3. Excess SDI (or VPDI) withheld. Subtract line 2 from line 1. Enter the results here. Combine the amounts on line 3 and enter the total, in whole dollars only on line 74 . If zero or less, enter -0- on line 74. |
Line 75
For the Claim of Right credit, follow the reporting instructions in Schedule CA (540), line 41 under the Claim of Right.
Claim of Right: If you are claiming the tax credit on your California tax return, include the amount of the credit in the total for this line. Write in "IRC 1341" and the amount of the credit to the left of the amount column.
To determine if you are entitled to this credit, refer to your prior year California Form 540, Form 540NR (Long or Short), or Schedule CA (540 or 540NR) to verify the amount was included in your CA taxable income. If the amount repaid under a "Claim of Right" was not originally taxed by California, you are not entitled to claim the credit.
Overpaid Tax or Tax Due
To avoid delay in processing of your tax return, enter the correct amounts on line 91 through line 94.
Line 91 - Overpaid Tax
If the amount on line 75 is more than the amount on line 64, your payments and credits are more than your tax. Subtract the amount on line 64 from the amount on line 75. Enter the result on line 91.
Tip: Choose e-file and Direct Deposit and get your refund faster.
Line 92 - Amount You Want Applied to Your 2014 Estimated Tax
Apply all or part of the amount on line 91 to your estimated tax for 2014. Enter on line 92 the amount of line 91 that you want applied to your 2014 estimated tax.
An election to apply an overpayment to estimated tax is binding. Once the election is made, the overpayment cannot be applied to a deficiency after the due date of the tax return.
Line 93 - Overpaid Tax Available This Year
If you entered an amount on line 92, subtract it from the amount on line 91. Enter the result on line 93. Choose to have this entire amount refunded to you, make contributions to the California Seniors Special Fund (see page 23), or make other voluntary contributions from this amount.
Line 94 - Tax Due
If the amount on line 75 is less than the amount on line 64, subtract the amount on line 75 from the amount on line 64. Enter the result on line 94. Your tax is more than your payments and credits.
There is a penalty for not paying enough tax during the year. You may have to pay a penalty if:
- The tax due on line 94 is $500 or more ($250 or more if married/RDP filing separately).
- The amount of state income tax withheld on line 71 is less than 90% of the amount of your total tax on line 64.
If this applies to you, see instructions on line 113.
Increasing your withholding could eliminate the need to make a large payment with your tax return. To increase your withholding, complete EDD Form DE 4, Employee's Withholding Allowance Certificate, and give it to your employer's appropriate payroll staff. Get this form from your employer or by calling EDD at 888.745.3886. Download the DE 4 at edd.ca.gov or to use the online calculator, go to ftb.ca.gov and search for de 4.
Form DE 4 specifically adjusts your California state withholding and is not the same as the federal Form W-4, Employee's Withholding Allowance Certificate.
Use Tax
Line 95 - Use Tax. This is not a total line.
You may owe use tax if you make purchases from out of state retailers (for example, purchases made by telephone, over the Internet, by mail, or in person) where sales or use tax was not paid and you use those items in California. If you have questions about whether a purchase is taxable, go to the State Board of Equalization's website at boe.ca.gov, or call their Customer Service Center at 800.400.7115 or California Relay Service (CRS) 711 (for hearing and speech disabilities.)
Some taxpayers are required to report business purchases subject to use tax directly to the State Board of Equalization. However, they may report certain personal purchases subject to use tax on the FTB income tax return.
You may not report use tax for business purposes on your income tax return if you:
- Have a California seller's permit.
- Are not required to hold a California seller's permit, but receive at least $100,000 in gross receipts.
- Are otherwise required to be registered with the State Board of Equalization for sales or use tax purposes.
The Use Tax Worksheet and Use Tax Lookup Table will help you determine how much use tax to report. If you owe use tax but you do not report it on your income tax return, you must report and pay the tax to the State Board of Equalization. For information on how to report use tax directly to the State Board of Equalization, go to their website at boe.ca.gov and type "use tax" into the search box.
Failure to report and pay timely may result in the assessment of interest, penalties and fees.
Use Tax Worksheet
You must use the Use Tax Worksheet to calculate your use tax liability, if any of the following apply:
- You prefer to calculate the amount of use tax due based upon your actual purchases subject to use tax, rather than based on an estimate.
- You owe use tax on any item purchased for use in a trade or business not registered with the State Board of Equalization.
- You owe use tax on purchases of individual items with a purchase price of $1,000 or more.
Example 1: You purchased a television for $2,000 from an out-of state retailer that did not collect use tax. You must use the Use Tax Worksheet to calculate the use tax due on the price of the television, since the price of the television is $1,000 or more.
Example 2: You purchased a computer monitor for $300, a rare coin for $500, and designer clothing for $250 from an out-of-state retailer that did not collect use tax. Although the total price of all the items is $1,050, the price of each item is less than $1,000. Since none of these individual items are $1,000 or more, you are not required to use the Use Tax Worksheet and may choose to use the Estimated Use Tax Lookup Table.
If you have a combination of individual items purchased for $1,000 or more, and/or items purchased for use in a trade or business not registered with the State Board of Equalization, and individual, non-business items purchased for less than $1,000, you may either:
- Use the Use Tax Worksheet to compute use tax due on all purchases, or
- Use the Use Tax Worksheet to compute use tax due on all individual items purchased for $1,000 or more plus items purchased for use in a trade or business, use the Estimated Use Tax Lookup Table to estimate the use tax due on individual, non-business items purchased for less than $1,000, then add the amounts and report the total use tax on line 95.
Example 3: The total price of the items you purchased from out-of-state retailers that did not collect use tax is $2,300, which includes a $1,000 television, a $900 painting, and a $400 table for your living room.
- You may choose to calculate the use tax due on the total price of $2,300 using the Use Tax Worksheet, or
- You may choose to calculate the use tax due on the $1,000 price of the television using the Use Tax Worksheet and estimate your use tax liability for the painting and table by using the Estimated Use Tax Lookup Table.
Use Tax Worksheet (See Instructions Below)
Use whole dollars only.
| 1. Enter purchases from out-of-state sellers made without payment of California sales/use tax. If you choose to estimate the use tax due on individual, non-business items purchased for less than $1,000 each, only enter purchases of items with a purchase price of $1,000 or more plus items purchased for use in a trade or business not registered with the State Board of Equalization |
$ _____.00
|
| 2. Enter the applicable sales and use tax rate |
_______
|
| 3. Multiply line 1 by the tax rate on line 2. Enter result here |
$_____.00
|
| 4. If you choose to estimate the use tax due on individual, non-business items purchased for less than $1,000 each, enter the use tax amount due from the Use Tax Lookup Table. If all of your purchases are included in line 1, enter -0-. |
$_____.00
|
| 5. Add lines 3 and 4. This is your total use tax |
$ ____.00
|
|
6. Enter any sales or use tax you paid to another state for purchases included on line 1. See worksheet instructions below |
$_____.00
|
|
7. Subtract line 6 from line 5. This is the total use tax due. Enter the amount due on line 95. If the amount is less than zero, enter -0-. |
$_____.00
|
Worksheet, Line 1, Purchases Subject to Use Tax
Report purchases of items that would have been taxable if purchased from a California retailer unless your receipt shows that California tax was paid directly to the retailer. For example, generally, you would include purchases of clothing, but not purchases of food products or prescription medicine. For more information on nontaxable and exempt purchases, you may visit the State Board of Equalization's website at boe.ca.gov.
- Include handling charges.
- Do not include any other state's sales or use tax paid on the purchases.
- Enter only purchases made during the year that corresponds with the tax return you are filing.
- If you traveled to a foreign country and carried items back to California, generally use tax is due on the purchase price of the goods you listed on your U.S. Customs Declaration less the $800 per-person exemption. For the hand carried items, you should report the amount of purchases in excess of the $800 per person exemption. This $800 exemption does not apply to goods sent or shipped to California by mail or other common carrier. For goods sent or shipped, you should report the entire amount of the purchases.
- If your filing status is "married/RDP filing separately," you may elect to report one-half of the use tax due or the entire amount on your income tax return. If you elect to report one-half, your spouse/RDP may report the remaining half on his or her income tax return or on the individual use tax return available from the State Board of Equalization.
Note: Report and pay any use tax you owe on the following purchases directly to the State Board of Equalization, not on your income tax return.
- Vehicles, vessels, and trailers that must be registered with the Department of Motor Vehicles.
- Mobile homes or commercial coaches that must be registered annually as required by the Health and Safety Code.
- Vessels documented with the U.S. Coast Guard.
- Aircraft.
- Leases of machinery, equipment, vehicles, and other tangible personal property.
- Cigarettes and tobacco products when the purchaser is registered with the State Board of Equalization as a cigarette and/or tobacco products consumer.
Worksheet, Line 2, Sales and Use Tax Rate
- Enter the sales and use tax rate applicable to the place in California where the property was used, stored, or otherwise consumed. If you do not know the applicable city or county sales and use tax rate, using your computer or mobile device please go to the State Board of Equalization's website at boe.ca.gov and click on City and County Tax Rates or call their Customer Service Center at 800.400.7115 or California Relay Service (CRS) 711 (for hearing and speech disabilities.)
Worksheet, Line 6, Credit for Tax Paid to Another State
This is a credit for tax paid to other states on purchases reported on Line 1. You can claim a credit up to the amount of tax that would have been due if the purchase had been made in California. For example, if you paid $8.00 sales tax to another state for a purchase, and would have paid $6.00 in California, you can claim a credit of only $6.00 for that purchase.
Estimated Use Tax Lookup Table
You may use the Estimated Use Tax Lookup Table to estimate and report the use tax due on individual non-business items you purchased for less than $1,000 each. This option is only available if you are permitted to report use tax on your income tax return and you are not required to use the Use Tax Worksheet to calculate the use tax owed on all your purchases. Simply include the use tax liability that corresponds to your California Adjusted Gross Income (found on line 17) and enter it on line 95. You will not be assessed additional use tax on the individual non-business items you purchased for less than $1,000 each.
You may not use the Estimated Use Tax Lookup Table to estimate and report the use tax due on purchases of items for use in your business or on purchases of individual non-business items you purchased for $1,000 or more each. See the instructions for the Use Tax Worksheet if you have a combination of purchases of individual non-business items for less than $1,000 each and purchases of individual non-business items for $1,000 or more.
Enter your use tax liability on Line 4 of the worksheet or if you have no single purchase over $999.99 then enter the amount on Line 95 of your income tax return.
Contributions
You can make voluntary contributions to the funds listed on Side 4. See page 23 for a description of the funds.
You may also contribute any amount to the State Parks Protection Fund/ Parks Pass Purchase. To receive a single annual park pass, your contribution must equal or exceed $150. When applicable, FTB will forward your name and address from your tax return to the Department of Parks and Recreation (DPR) who will issue a single Vehicle Day Use Annual Pass to you. Only one pass will be provided per tax return. You may contact DPR directly to purchase additional passes. If there is an error on your tax return in the computation of total contributions or if we disallow the contribution you requested because there is no credit available for the tax year, your name and address will not be forwarded to DPR. Any contribution less than $150 will be treated as a voluntary contribution and may be deducted as a charitable contribution. For more information go to parks.ca.gov/annualpass/ or email info@parks.ca.gov.
Amount You Owe
Add or subtract correctly to figure the amount you owe.
Line 111 - Amount You Owe
If you have an amount on line 94, add the amount on line 94, line 95, and line 110, if any. Enter the result on line 111.
If you have an amount on line 93, subtract line 95 and line 110 from line 93. If the combined amount of line 95 and line 110 is more than line 93, enter the difference on line 111.
To avoid a late filing penalty, file your Form 540 by the extended due date even if you cannot pay the amount you owe.
Mandatory Electronic Payments. You are required to remit all your payments electronically once you make an estimate or extension payment exceeding $20,000 or you file an original return with a total tax liability over $80,000. Once you meet this threshold, all subsequent payments regardless of amount, tax type, or taxable year must be remitted electronically. The first payment that would trigger the mandatory e-pay requirement does not have to be made electronically. Individuals that do not send the payment electronically will be subject to a 1% noncompliance penalty.
You can request a waiver from mandatory e-pay if one or more of the following is true:
- You have not made an estimated tax or extension payment in excess of $20,000 during the current or previous taxable year.
- Your total tax liability reported for the previous taxable year did not exceed $80,000.
- The amount you paid is not representative of your total tax liability.
Electronic payments can be made using Web Pay on FTB's website, electronic funds withdrawal (EFW) as part of the e-file return, or your credit card. For more information or to obtain the waiver form, go to ftb.ca.gov and search for mandatory epay.
Payment Options
- Electronic Funds Withdrawal - Instead of paying by check or money order, use this convenient option if you e-file. Simply provide your bank information, amount you want to pay, and the date you want the balance due to be withdrawn from your account. Your tax preparation software will offer this option.
- Web Pay - Pay the amount you owe using our secure online payment service. Go to ftb.ca.gov for more information.
- Credit Card - Use your Discover, MasterCard, Visa, or American Express card to pay your tax. If you pay by credit card, do not mail form FTB 3519 to us. Call 800.272.9829 or go to the Official Payments Corp. website at officialpayments.com, and use the jurisdiction code 1555. Official Payments Corp. charges a convenience fee for using this service.
- Check or Money Order - Using black or blue ink, make your check or money order payable to the "Franchise Tax Board." Do not send cash. Write your SSN or ITIN and "2013 Form 540" as applicable on the check or money order. Enclose, but do not staple, your payment with your tax return.
Make all checks or money orders payable in U.S. dollars and drawn against a U.S. financial institution. Do not combine your 2013 tax payment and any 2014 estimated tax payment in the same check. Prepare two separate checks and mail each in a separate envelope.
If you e-filed your tax return, mail your check or money order with form FTB 3582, Payment Voucher for Individual e-filed Returns. Do not mail a copy of your e-filed tax return.
A penalty may be imposed if your check is returned by your bank for insufficient funds.
Paying by Credit Card - Whether you e-file or file by mail, use your Discover, MasterCard, Visa, or American Express card to pay your personal income taxes (tax return balance due, extension payment, estimated tax payment, or tax due with bill notice). There is a convenience fee for this service. This fee is paid directly to Official Payments Corp. based on the amount of your tax payment.
Convenience Fee
- 2.30% of the tax amount charged (rounded to the nearest cent)
- Minimum fee: $1
Example: Tax Payment = $753.56 Convenience Fee = $17.33
When will my payments be effective? Your payment is effective on the date you charge it.
What if I change my mind? If you pay your tax liability by credit card and later reverse the credit card transaction, you may be subject to penalties, interest, and other fees imposed by the FTB for nonpayment or late payment of your tax liability.
How do I use my credit card to pay my income tax bill? Once you have determined the type of payment and how much you owe, have the following ready:
- Your Discover, MasterCard, Visa, or American Express card
- Credit card number
- Expiration date
- Amount you are paying
- Your and your spouse's/RDP's SSN or ITIN
- First 4 letters of your and your spouse's/RDP's last name
- Taxable year
- Home phone number (including area code)
- ZIP Code for address where your monthly credit card bill is sent
- FTB Jurisdiction Code: 1555
Go to the Official Payments Corp. online payment center at officialpayments.com or call 800.2PAY.TAX or 800.272.9829 and follow the recorded instructions. Official Payments Corp. provides customer assistance at 877.297.7457 Monday through Friday, 5:00 a.m. to 5:00 p.m. PST.
Payment Date: _________
Confirmation Number: ________
If you cannot pay the full amount or can only make a partial payment for the amount shown on Form 540, line 114, see the information regarding Installment Payments on page 21.
Interest and Penalties
If you file your tax return or pay your tax after the due date, you may owe interest and penalties on the tax due.
Do not reduce the amount on line 91 or increase the amount on line 94 by any penalty or interest amounts. Enter on Form 540, line 112 the amount of interest and penalties.
Line 112 - Interest and Penalties
Interest. Interest will be charged on any late filing or late payment penalty from the original due date of the return to the date paid. In addition, if other penalties are not paid within 15 days, interest will be charged from the date of the billing notice until the date of payment. Interest compounds daily and the interest rate is adjusted twice a year. The FTB website has a chart of interest rates in effect since 1976. Go to ftb.ca.gov and search for interest rates.
Late Filing of Tax Return. If you do not file your tax return by October 15, 2014, you will incur a late filing penalty plus interest from the original due date of the tax return. The maximum total penalty is 25% of the tax not paid if the tax return is filed after October 15, 2014. The minimum penalty for filing a tax return more than 60 days late is $135 or 100% of the balance due, whichever is less.
Late Payment of Tax. If you fail to pay your total tax liability by April 15, 2014, you will incur a late payment penalty plus interest. The penalty is 5% of the tax not paid when due plus 1/2% for each month, or part of a month, the tax remains unpaid. We may waive the late payment penalty based on reasonable cause. Reasonable cause is presumed when 90% of the tax shown on the return is paid by the original due date of the return. However, the imposition of interest is mandatory. If, after April 15, 2014, you find that your estimate of tax due was too low, pay the additional tax as soon as possible to avoid or minimize further accumulation of penalties and interest.
Penalties. To avoid late payment penalties for use tax, you must report and pay the use tax with a timely filed income tax return, or California Individual Use Tax return.
Other Penalties. We may impose other penalties if a payment is returned for insufficient funds. We may also impose penalties for negligence, substantial understatement of tax, and fraud.
Line 113 - Underpayment of Estimated Tax
You may be subject to an estimated tax penalty if any of the following is true:
- Your withholding and credits are less than 90% of your current tax year liability.
- Your withholding and credits are less than 100% of your prior year tax liability (110% if AGI is more than $150,000 or $75,000 if married/RDP filing separately).
- You did not pay enough through withholding to keep the amount you owe with your tax return under $500 ($250 if married/RDP filing separately).
The FTB can figure the penalty for you when you file your tax return and send you a bill.
Is line 94 less than $500 ($250 if married/RDP filing separately)?
Yes. Stop. You are not subject to an estimated payment penalty.
No. Continue. You may be subject to an estimated payment penalty.
Is line 94 less than 10% of the amount on line 48? Form 540 filers: this excludes the tax on lump-sum distributions on Form 540, line 34.
Yes. Stop. You are not subject to an estimated payment penalty.
No. You may be subject to an estimated payment penalty; get form FTB 5805, Underpayment of Estimated Tax by Individuals and Fiduciaries (or form FTB 5805F, Underpayment of Estimated Tax by Farmers and Fishermen).
The underpayment of estimated tax penalty shall not apply to the extent the underpayment of an installment was created or increased by any provision of law that is chaptered during and operative for the taxable year of the underpayment. To request a waiver of the underpayment of estimated tax penalty, get form FTB 5805 or form FTB 5805F. See "Where To Get Income Tax Forms and Publications" on page 66.
If you complete one of these forms, attach it to the back of your Form 540. Enter the amount of the penalty on line 113 and check the correct box on line 113. Complete and attach the form if you claim a waiver, use the annualized income installment method, or pay tax according to the schedule for farmers and fishermen, even if you do not owe a penalty.
See "Important Dates" on page 2, for more information on estimated tax payments and how to avoid the underpayment penalty.
See the instructions for Form 540, line 114 for information about figuring your payment, if any.
Line 114 - Total Amount Due
Is there an amount on line 111?
Yes Add line 111, line 112, and line 113. Enter the result on line 114. For payment options, see line 111 instructions.
No. Go to line 115.
Make all checks or money orders payable in U.S. dollars and drawn against a U.S. financial institution.
Refund or No Amount Due
Line 115 - Refund or No Amount Due
Did you report amounts on line 95, line 110, line 112, or line 113?
No. Enter the amount from line 93 on line 115. This is your refund amount. If it is less than $1, attach a written statement to your Form 540 requesting the refund.
Yes. Combine the amounts from line 95, line 110, line 112, and line 113. If the result is:
- More than line 93, subtract line 93 from the sum of line 95, line 110, line 112, and line 113 and enter the result on line 114. This is your total amount due. For payment options, see line 111 instructions.
- Less than line 93, subtract the sum of line 95, line 110, line 112, and line 113 from line 93 and enter on line 115. This is your refund amount.
Want a fast refund? Get your refund in 10 days or less when you e-file your tax return.
Direct Deposit (Refund Only)
Line 116 and Line 117 - Direct Deposit of Refund
Direct deposit is fast, safe, and convenient. To have your refund directly deposited into your bank account, fill in the account information on line 116 and line 117. Fill in the routing and account numbers and indicate the account type. Verify routing and account numbers with your financial institution. Do not attach a voided check or deposit slip. See the illustration on page 16.
Individual taxpayers may request that their refund be electronically deposited into more than one checking or savings account. This allows more options for managing your refund. For example, you can request part of your refund go to your checking account to use now and the rest to your savings account to save for later.
The routing number must be nine digits. The first two digits must be 01 through 12 or 21 through 32. On the sample check, the routing number is 250250025. The account number can be up to 17 characters and can include numbers and letters. Include hyphens but omit spaces and special symbols. On the sample check, the account number is 202020.
Check the appropriate box for the type of account. Do not check more than one box for each line.
Enter the portion of your refund you want directly deposited into each account. Each deposit must be at least $1. The total of line 116 and line 117 must equal the total amount of your refund on line 115. If line 116 and line 117 do not equal line 115, the FTB will issue a paper check.
Caution: Check with your financial institution to make sure your deposit will be accepted and to get the correct routing and account numbers. The FTB is not responsible for a lost refund due to incorrect account information entered by you or your representative.
Some financial institutions will not allow a joint refund to be deposited to an individual account. If the direct deposit is rejected, the FTB will issue a paper check.
Sign Your Tax Return
You must sign your tax return in the space provided on Form 540, Side 5. If you file a joint tax return, your spouse/RDP must sign the tax return also.
Include your phone number and email address in case the FTB needs to contact you for information needed to process your tax return. By providing this information the FTB will be able to process your tax return or issue your refund faster.
Joint Tax Return. If you file a joint tax return, both you and your spouse/RDP are generally responsible for the tax and any interest or penalties due on the tax return. This means that if one spouse/RDP does not pay the tax due, the other may be liable. See "Innocent Joint Filer Relief," on page 20.
Paid Preparer's Information. If you pay a person to prepare your Form 540, that person signs and completes the area at the bottom of Side 5 including an identification number. Effective January 1, 2011, the IRS requires a paid tax preparer to get and use a preparer tax identification number (PTIN). If the preparer has a federal employer identification number (FEIN), it should be entered only in the space provided. A paid preparer must give you a copy of your tax return to keep for your records.
Third Party Designee. If you want to allow your preparer, a friend, family member, or any other person you choose to discuss your 2013 tax return with the FTB, check the "Yes" box in the signature area of your tax return. Also print the designee's name and telephone number.
If you check the "Yes" box you, and your spouse/RDP, if filing a joint tax return, are authorizing the FTB to call the designee to answer any questions that may arise during the processing of your tax return. You are also authorizing the designee to:
- Give the FTB any information that is missing from your tax return.
- Call the FTB for information about the processing of your tax return or the status of your refund or payments.
- Receive copies of notices or transcripts related to your tax return, upon request.
- Respond to certain FTB notices about math errors, offsets, and tax return preparation.
You are not authorizing the designee to receive any refund check, bind you to anything (including any additional tax liability), or otherwise represent you before the FTB. If you want to expand or change the designee's authorization, get form FTB 3520, Power of Attorney Declaration for the Franchise Tax Board.
The authorization will automatically end no later than the due date (without regard to extensions) for filing your 2014 tax return. This is April 15, 2015, for most people. If you wish to revoke the authorization before it ends, notify us by telephone at 800.852.5711 or by writing to Franchise Tax Board, PO Box 942840, Sacramento, CA 94240-0040, include your name, SSN, and the designee's name.
Power of Attorney. If another person prepared your tax return, he or she is not automatically granted access to your tax information in future dealings with us. At some point, you may wish to designate someone to act on your behalf in matters related or unrelated to this tax return (e.g., an audit examination). To protect your privacy, you must submit to us a legal document called a "Power of Attorney" (POA) authorizing another person to discuss or receive personal information about your income tax records.
For more information, get form FTB 3520, available at ftb.ca.gov . See "Where To Get Income Tax Forms and Publications" on page 66.
Filing Your Tax Return
Attachments to your tax return.
Do I need to attach a copy of federal Form 1040?
Other than Schedule A (Form 1040) or Schedule B (Form 1040), did you attach any federal forms or schedules to your federal Form 1040?
If No, do not attach a copy of your federal Form 1040 return to Form 540.
If Yes, attach a copy of your federal Form 1040 return and all supporting federal forms and schedules to Form 540.
Exception: If you did not itemize deductions on your federal tax return but will itemize deductions on your California tax return, complete and attach a copy of the federal Schedule A (Form 1040) to Form 540.
Do not attach any documents to your tax return unless specifically instructed. This will help us reduce government processing and storage costs.
Federal Form(s) W-2, W-2G, and 1099, and CA Form(s) 592-B and 593. Attach all the Form(s) W-2 and W-2G you received to the lower front of your tax return. Also, attach any Forms(s) 1099, 592-B, and 593 showing California income tax withheld.
If you do not receive your Form(s) W-2 by January 31, 2014, contact your employer or go to ftb.ca.gov and search for myftb account. Only your employer can issue or correct a Form W-2. If you cannot get a copy of your Form W-2, you must complete form FTB 3525, Substitute for Form W-2, Wage and Tax Statement, or Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit Sharing Plans, IRAs, Insurance Contracts, etc. See "Order Forms and Publications" on page 67 or go to ftb.ca.gov.
If you forget to send your Form(s) W-2 or other withholding forms with your income tax return, do not send them separately, or with another copy of your tax return. Wait until the FTB requests them from you.
