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Changes to 2012 Forms

Updates to the Form 593 on 12/21/2012 –– Real Estate Withholding Tax Statement

We replaced text on:

  1. Form Side 1, Part II, Number 4, under Optional Gain on Sale Election, percentage in text of box B, C, F, and G
  2. Instructions Page 1, Column 1, General Information section, Paragraph 1
  3. Instructions Page 3, Column 3, percentages under Tax Rates (Individual, Non-CA Partnership, S Corporation, Financial S Corporation)

Previous Version

  1. Optional Gain on Sale Election (Signature required below)
    BIndividual 9.3% x Gain on Sale
    CNon-California Partnership 9.3% x Gain on Sale
    DCorporation 8.84% x Gain on Sale
    EBank and Financial Corp. 10.84% x Gain on Sale
    FS Corporation 10.8% x Gain on Sale
    GFinancial S Corporation 12.8% x Gain on Sale
  2. For taxable years beginning on or after January 1, 2011, the maximum personal income tax rate is 9.3%. In addition, non-California partnerships are subject to withholding requirements on a sale of California real property at a rate of 3 1/3% (.0333) of sales price or 9.3% of gain. The alternative withholding rate for the gain on sale of California real property by S corporations is 10.8% and 12.8% for Financial S corporations.
  3. *Tax Rates
    Individual 9.3%
    Non-California Partnership 9.3%
    Corporation 8.84%
    Bank and Financial Corporation 10.84%
    S Corporation 10.8%
    Financial S Corporation 12.8%

Revised Version

  1. Optional Gain on Sale Election (Signature required below)
    BIndividual 12.3% x Gain on Sale
    CNon-California Partnership 12.3% x Gain on Sale
    DCorporation 8.84% x Gain on Sale
    EBank and Financial Corp. 10.84% x Gain on Sale
    FS Corporation 13.8% x Gain on Sale
    GFinancial S Corporation 15.8% x Gain on Sale
  2. For taxable years beginning on or after January 1, 2012, the maximum personal income tax rate is 12.3%. In addition, non-California partnerships are subject to withholding requirements on a sale of California real property at a rate of 3 1/3% (.0333) of sales price or 12.3% of gain. The alternative withholding rate for the gain on sale of California real property by S corporations is 13.8% and 15.8% for Financial S corporations.
  3. *Tax Rates
    Individual 12.3%
    Non-California Partnership 12.3%
    Corporation 8.84%
    Bank and Financial Corporation 10.84%
    S Corporation 13.8%
    Financial S Corporation 15.8%

Reason for the changes

In November 2012 Proposition 30 was passed by California voters. This ballot measure increased the maximum personal income tax rate for taxable years beginning on or after January 1, 2012, from 9.3% to 12.3%. As a result of the personal income tax rate increase, the alternative withholding rate for the gain on sale of California real property by individuals and non-California partnerships increased from 9.3% to 12.3%. The gain on sale of California real property by S corporations increased from 10.8% to 13.8% and from 12.8% to 15.8% for financial S corporations. We are revising the form and instructions to reflect the increase in the rates.

Impact

No tax impact.

Back to Tax Form Changes for 2012