Sacramento January 3, 2011 – The Franchise Tax Board (FTB) today announced it is now accepting 2010 state tax returns. Also, FTB provides the following updates on law changes and filing services.
"FTB's website offers free tax filing services, help with account matters, and information about the federal Earned Income Tax Credit that can put thousands of dollars in families' wallets," said State Controller and FTB Chair John Chiang.
Final filing date is Monday, April 18 -- Since Friday, April 15, is a legal holiday in Washington DC (Emancipation Day), the IRS has announced that taxpayers nationwide have until the following business day, Monday, April 18, to timely file returns and pay taxes. California will accept as timely, tax returns and payments received on April 18.
Tax booklets no longer mass mailed – FTB no longer mass mails tax booklets to taxpayers. Tax booklets, which contain tax forms and instructions, are available online at ftb.ca.gov. FTB's website offers many e-file options, including FTB's free CalFile and ReadyReturn services, as well as free and fee-based services offered by private companies. Many post offices and libraries also stock tax booklets. Taxpayers who are unable to obtain a tax booklet can call FTB at 800.338.0505 to request one.
Form 540 2EZ now available in Spanish—FTB's "short form" is now avaible in both English and Spanish. The 2EZ is designed for taxpayers whose income is mostly from wages, take the standard deduction, have up to three dependents, and have no adjustments to income.
Standard deduction – The standard deduction for single or filing separately tax statuses increased from $3,637 to $3,670. For joint, surviving spouse, or head of household filers, it increased from $7,274 to $7,340.
Personal exemption credit – The personal exemption amount for single, filing separately, and head of household filers increased from $98 to $99. For joint or surviving spouses, it increased from $196 to $198. The dependent exemption credit is also $99 per dependent.
New Jobs tax credit still available – Starting in 2009, this incentive provides a tax credit of up to $3,000 for each added qualified full-time employee hired by a qualified small business employer. Funding is limited to $400 million. As of January 1, $360 million remains available. The credit must be claimed on a timely-filed original (not amended) 2010 return received before the $400 million limit is exhausted.
Generally speaking, employers qualify for the credit if they employed 20 or fewer employees in the prior year. They have a net increase in qualified full-time employees in 2010 compared to the number of full-time employees employed in the prior year.
Net operating losses suspended – For 2010 and 2011, net operating losses from prior years cannot be deducted by certain taxpayers. The net operating loss suspension rules do not apply to taxpayers with net income of less than $300,000 or with disaster loss carryovers.
Voluntary Contribution Funds – Taxpayers can contribute to one or more charitable causes directly from the state tax form. New on the 2010 tax return are the:
· Arts Council Fund.
· California Police Activities League (CALPAL) Fund.
· California Veterans Homes Fund.
· Safely Surrendered Baby Fund.
Free Do-it-Yourself Services -- FTB encourages taxpayers and practitioners to explore its many self-service applications available through FTB's website:
- ReadyReturn – Taxpayers who file the simplest returns may qualify for FTB's online ReadyReturn program. FTB uses information it already has to complete a tax return for the taxpayer. The taxpayer just needs to review the return, make any needed changes, and click a button to send it directly to FTB. More than 2 milliontaxpayers will qualify who last year:
· Earned wages from a single employer.
· Filed either as single or head of household.
· Took the standard deduction.
· Claimed no more than five dependents.
· Taxpayers who are renters and who can be claimed as a dependent are also eligible.
- CalFile –More than 6.4 million taxpayers are qualified to use CalFile, FTB's no-cost, direct-to-FTB, online filing program. Taxpayers enter their tax information on FTB's secure website and transmit their return directly to FTB. CalFileaccepts taxpayers with income of up to $324,376, itemized deductions, and some tax credits.
- Access Your Account –This online service allows taxpayers to change their address or phone number and get information such as estimated tax payments, any balances due, state W-2 information, or FTB-issued 1099 forms. Taxpayers and tax professionals complete a one-time registration process where they choose their own user name and password. This service eliminates the need for taxpayers to get a customer service number each year.
- Check Your Refund Status –After filing the 2010 tax return, taxpayers can use this service to see where their refund is. e-filed returns claiming refunds and opting for direct deposit are generally issued within seven days and mailed refund checks are generally sent within two weeks. Paper-filed returns take longer, up to six to eight weeks depending on the time of year the return is filed. This service is also available in Spanish.
-Pay Taxes Online – FTB's Web Pay allows taxpayers to authorize a payment from their bank account to pay their return balance due or extension payment. Payment must be made on or before April 18, to avoid penalties and interest. Taxpayers can also make estimated tax or any bill payments online, and sign up for email reminders of upcoming estimate payment due dates. Taxpayers can schedule payments up to one year in advance. For a fee, taxpayers can pay their taxes with their American Express, Discover/NOVUS, MasterCard, and Visa cards.
New for 2011, business tax filers can also use Web Pay to pay taxes online.
- Request a Monthly Payment Plan – FTB offers monthly installment payment plans to people who cannot pay what they owe on time. Taxpayers who owe less than $25,000 and can repay the tax within five years generally qualify. Sign up online at ftb.ca.gov and select installment agreement request.
- Get Answers to Frequently Asked Questions – Find answers to questions about various tax topics such as return filing requirements, tax credits, and the requirements to be able to use the Head of Household filing status online at ftb.ca.gov.
- Phone service – FTB provides automated toll-free phone service at 800.338.0505. To speak with a customer service representative, FTB staffs its general toll-free phone line, 800.852.5711, from 7 a.m. to 5 p.m., weekdays excluding state holidays.
- Field Offices– FTB has six regional field offices that provide walk-in service from 8 a.m. to 5 p.m., weekdays in Los Angeles, Oakland, Sacramento, San Diego, San Francisco, and Santa Ana. For directions, visit ftb.ca.gov and click on the Contact Us tab.
- Voluntary Income Tax Assistance – Starting February 1, more than 1,000 centers statewide open through the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs. These sites offer free help with tax form preparation.Some offer services in Spanish, Chinese, Vietnamese, and Korean. For information on locations throughout California, visit ftb.ca.gov and click on the free filing assistance link.
- Federal Earned Income Tax Credit– This is a federal incentive for low-income individuals and families. Taxpayers earning less than $48,362 can qualify for a "refundable" credit that can total up to $5,666. "Refundable" means that you do not have to have a tax liability to get a refund check from the government. If you think you might qualify, visit the IRS website at irs.govand search for EITC Assistant. California has no comparable state credit.
- FTB using Social Media – FTB is using Twitter, Facebook, and YouTube to share information regarding the coming state income tax filing season. Three instructional YouTube videos highlight the ease of using CalFile, ReadyReturn, and FTB's recently updated Access Your Account feature. "California Tax Tips" offer tips about taxes in videos of 60 seconds or less.
- Recordkeeping – Keep a copy of your state tax returns and all supporting records. FTB may request information from you regarding your tax return at any time within the California statute of limitations period, which is generally four years from the return's due date.
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