When figuring your required estimated tax payments, you must pay the lesser of 100 percent of last year's tax or 90 percent of your current year's tax. However, individuals whose 2007 adjusted gross income is more than $150,000 (or $75,000 if married filing a separate return), must figure estimated tax based on the lesser of 90 percent of their tax for 2008 or 110 percent of their tax for 2007. This rule does not apply to farmers or fishermen. To avoid an estimate penalty,you must pay at least one-fourth of the required estimated tax for each quarter.
Find the total tax line on your last year's return Form 540A, line23, Form 540, line34 or Form 540NR, line43. If you have 2007 California withholding, subtract that amount from your total tax. For current year tax, figure the amount you expect your 2008 total tax to be and multiply it by 90 percent. Subtract your expected 2008 California withholding from this amount. You may pay the lesser of the two amounts.
You may also use the Estimate Tax Worksheet in the instructions for Estimated Tax for Individuals (Form 540-ES) to figure your estimated tax payments.
Use Form 540-ES vouchers to pay your estimated tax installments.