California tax filing season news
For Immediate Release
Sacramento – Tax season is in full swing at the Franchise Tax Board (FTB). FTB wants to alert taxpayers to changes for this year and encourages everyone to take advantage of online services to file taxes and secure their refunds as quickly as possible.
“More people will qualify for state tax credits this year, and there are free tax assistance programs available to Californians,” said State Controller and FTB Chair Betty T. Yee. “Visit the Franchise Tax Board online to learn about free tax preparation sites, e-file options, valuable tax credits, and more.”
California earned income tax credit and young child tax credit
This year, an estimated 3 million families are expected to claim California’s expanded Earned Income Tax Credit (CalEITC). Taxpayers with income up to $30,000 may qualify for CalEITC.
Those who qualify for CalEITC and have a child under the age of 6 may also receive up to $1,000 worth of the new Young Child Tax Credit (YCTC). An estimated 400,000 families may be eligible to claim YCTC.
Taxpayers earning less than $55,952 may also qualify for the federal EITC.
Between CalEITC, YCTC and the federal EITC, a family can receive up to $8,053.
CalEITC and YCTC are claimed by filing a state tax return, while federal EITC is claimed on a federal return. More details about CalEITC, YCTC and the federal EITC are available at CalEITC4me.org, ftb.ca.gov/caleitc and irs.gov.
Free tax help
Taxpayers may be able to get help with their taxes for free. For a list of Volunteer Income Tax Assistance (VITA) program locations throughout California, go to ftb.ca.gov and search for free tax help.
State individual health care mandate
Beginning January 1, 2020, a new state law requires Californians to have qualifying health insurance coverage throughout the year. Those who fail to maintain qualifying coverage are subject to a penalty when they file their tax returns in 2021.
Generally speaking, a taxpayer who fails to secure and keep qualifying medical coverage will be subject to a penalty of $695 or more. The penalty for a dependent child is half of what it would be for an adult. The penalty for a married couple without coverage can be $1,390 or more, and the penalty for a family of four with two dependent children could be $2,085 or more.
The California Labor and Workforce Agency has developed some FAQs that have been posted on its website at https://www.labor.ca.gov/employmentstatus/ to help the public understand Assembly Bill 5 and what it does.
In addition, see the FTB California gig economy webpage.
State tax deduction for disaster losses
Disaster loss rules apply to victims in governor-declared or presidentially-declared disaster areas, most notably in areas hit by wildfires. Taxpayers may claim a disaster loss in the tax year that the disaster occurred, or by filing an amended or original return from the year prior to when the disaster occured. FTB can more quickly issue a refund for eligible losses claimed in the prior tax year.
Taxpayers claiming the disaster loss through e-file should follow software instructions to enter disaster information. Paper filers should write the name of the disaster in blue ink at the top of the state tax return to alert FTB to expedite the refund. Upon request, FTB will provide replacement state tax documents for free for those who lost them as a result of a disaster.
FTB’s MyFTB service allows taxpayers to view their tax documents, check balances due, access tax calculators, send secure messages to FTB staff, and more. FTB offers free electronic filing for state tax returns through CalFile, an easy-to-use tool available to more than 6.5 million taxpayers. CalFile allows taxpayers to e-file directly with FTB and provides instant confirmation when the return is received. Taxpayers can find a list of other filing options at ftb.ca.gov.
FTB continues to offer the Customer Service Dashboard on their website. The dashboard displays wait times for its contact centers in real-time, as well as time frames for processing refunds, payments, tax returns and correspondence. It also includes the wait time for the Tax Practitioner Hotline and MyFTB Secure Chat. This important tool will serve taxpayers and tax professionals again this year in identifying the best times to try and reach FTB agents for assistance should the need arise.
Walk-in service is available at five regional FTB field offices weekdays between 8 a.m. and 5 p.m. except state holidays. The field offices are in Los Angeles, Oakland, Sacramento, San Diego, and Santa Ana. Taxpayers can pay tax bills online using FTB’s WebPay. They can also pay using MasterCard, Visa, American Express, Discover, debit card, check, cashier’s check, or money order. A service fee of 2.3 percent is charged for credit card transactions.
FTB administers two of California’s major tax programs: Personal Income Tax and the Corporation Tax. FTB also administers other non tax programs and delinquent debt collection functions, including delinquent vehicle registration debt collections on behalf of the Department of Motor Vehicles, and court–ordered debt. Annually, FTB’s tax programs collect more than 70 percent of the state’s general fund. For more information on other taxes and fees in California, visit: taxes.ca.gov.