Decision Charts for Those Who Pay California Source Income to Nonresidents

• A corporation
• An LLC
• A partnership

Either of the following is true:

• It is qualified with the California Secretary of State to do business in California.
• It has a permanent place of business in California.

• The payee should complete FTB Form 590, Withholding Exemption Certificate, and give it to the withholding agent.
• No withholding required with a valid Form 590.

An individual

The payee is a California resident.

• The payee should complete FTB Form 590, Withholding Exemption Certificate, and give it to the withholding agent.
• No withholding required with a valid Form 590.

A tax-exempt entity

The payee is exempt from tax under federal law.

• The payee should complete FTB Form 590, Withholding Exemption Certificate, and give it to the withholding agent.
• No withholding required with a valid Form 590.

• A corporation
• An LLC
• A partnership

Both of the following are true:

• It is not qualified with the California Secretary of State to do business in California.
• It does not maintain a permanent place of business in California.

• Withhold 7 percent from all California source income payments that exceed $1,500 in a calendar year unless you receive other information from us.
• Send payments to us with a completed FTB Form 592, Quarterly Resident and Nonresident Withholding Statement. See Form 592 for payment due dates.
• Before January 31 following the close of the calendar year, provide the payee a statement showing the total amount of income subject to withholding and the total amount withheld. You may use FTB Form 592-B, Resident and Nonresident Withholding Tax Statement, for this purpose. See Form 592-B instructions for more details.
• Keep copies for your records.

An individual

The payee is not a resident of California.

• Withhold 7 percent from all California source income payments that exceed $1,500 in a calendar year unless you receive other information from us.
• Send payments to us with a completed FTB Form 592, Quarterly Resident and Nonresident Withholding Statement. See Form 592 for payment due dates.
• Before January 31 following the close of the calendar year, provide the payee a statement showing the total amount of income subject to withholding and the total amount withheld. You may use FTB Form 592-B, Resident and Nonresident Withholding Tax Statement, for this purpose. See Form 592-B instructions for more details.
• Keep copies for your records.

• A corporation
• An LLC
• A partnership
• An individual

Both of the following are true:

• The payee or you submit to us FTB Form 588, Nonresident Withholding Waiver Request, allowing us at least 21 business days before you make the California source income payment.
• The payee and you receive a waiver approval letter from us.

No withholding required with a waiver approval letter from us.

• A corporation
• An LLC
• A partnership
• An individual

Both of the following are true:

• The payee submits to us FTB Form 589, Nonresident Reduced Withholding Request, allowing us at least 10 business days before you make the California source income payment.
• We send you a Request for Reduced Withholding - Approval letter.

• Withhold the amount per the letter from us.
• Send payments to us with a completed FTB Form 592, Quarterly Resident and Nonresident Withholding Statement. See Form 592 for payment due dates.
• Before January 31 following the close of the calendar year, provide the payee a statement showing the total amount of income subject to withholding and the total amount withheld. You may use FTB Form 592-B, Resident and Nonresident Withholding Tax Statement, for this purpose. See Form 592-B instructions for more details.
• Keep copies for your records.