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Nonresident withholding

If you receive or pay California income, you must withhold taxes regardless of where you live, enter into a contract, or receive payment.

Withholding requirements

Nonwage withholding is required when a nonresident:

  • Provides services in California, such as independent contractors, performers, athletes, traveling nurses, public speakers.
  • Receives California income from pensions, distributions, real estate sales, and gambling winnings.

Nonresidents who receive California income

If you don’t live in California and receive California income, your payer withholds 7 percent from your income that exceeds $1,500 in a calendar year. When you file your tax return, you can claim this information as a withholding credit against your individual tax liabilities.

A payer (withholding agent) is the entity that pays you. Examples of payers include:

  • Promoter
  • Rental property manager
  • Partnership and LLC
  • Trust and estate

Find out if nonwage withholding from your income can be reduced or waived entirely for you.

  • Withholding worksheet: To determine if withholding is required on income you received, fill out Form 587, Nonresident Withholding Allocation Worksheet, for your payer.
  • Waiver request: To request a waiver on withholding, file Form 588, Nonresident Withholding Waiver Request. You can also file this form under MyFTB.
  • Waiver reduction: To itemize expenses against your income and reduce the withholding amount, file Form 589, Nonresident Reduced Withholding Request. You can also submit this form online. We’ll provide your payert with the reduced withholding amount.
  • Exemption: If you're a California resident or business who needs to be exempt from withholding, file Form 590, Withholding Exemption Certificate.

You’ll receive Form 592-B, Resident and Nonresident Withholding Tax Statement from your payer by January 31 after the end of calendar year. When you file your tax return, attach a copy of Form 592-B to report your withholding.

You’re still required to file a tax return if taxes are withheld from your California income.

Get the latest status on your return with the following options:

If there’s a delay in your refund or a generated balance due, there may be an error with the Form 592-B your payer submitted. Check your form for potential errors, such as:

  • Incorrect tax year
  • Incorrect name in payee section
  • Social security number (SSN) / Income tax identification numbers (ITIN) missing or incorrect

To resolve any withhold at source issues, contact withholding services and compliance at 888.792.4900. For all other issues, call 800.852.5711.

Withholding agents who pay nonresidents

Withholding agents (payers) are required to withhold 7 percent on payments and distributions that exceed $1500 to nonresidents in a calendar year. If you don’t comply with this law, you may be liable for the amount you should have withheld and penalties and interest.

A payer is the entity that pays you. Examples of payers include:

  • Promoter
  • Rental property manager
  • Partnership and LLC
  • Trust and estate

You’ll withhold on a nonresident if all of the following apply:

  • You’re responsible for the payment or distribution of California income
  • The payment or distribution will exceed $1,500 in the calendar year
  • The payment or distribution is made to, or for the services of, a resident of another state

You don’t have to withhold on a nonresident for any of the following:

  • Wages paid to employees
  • Payments for goods, supplies, and merchandise
  • Payments for services performed outside of California

To find out if you have a withholding requirement, take our withholding self test.

Figure out the reduced or waived withholding amount for the nonresident.

  • Withholding worksheet: If a nonresident fills out Form 587, Nonresident Withholding Allocation Worksheet for you, keep a copy for your records.
  • Waiver request: If a nonresident requests a waiver on withholding with Form 588, Nonresident Withholding Waiver Request, keep a copy of the determination letter for your records.
  • Waiver reduction:If a nonresident files Form 589, Nonresident Reduced Withholding Request, we’ll provide you with the reduced withholding amount.

Exception: You won’t need to make a payment if we sent you a nonresident’s waiver or reduced withholding amount.

The 7 percent you withhold must be sent to us. To make a payment, go to Payment Options.

  1. When you file your California information return, send us:
    • Form 592, Resident and Nonresident Withholding Statement
    • Form 592-V, Payment Voucher for Resident and Nonresident Withholding
    • Your withholding payment
  2. Send each nonresident Form 592-B, Resident and Nonresident Withholding Tax Statement, by January 31 following the end of calendar year. Keep a copy for your records.

For withholding forms, go to Forms and Publications.

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Last03/05/2018

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