CA Income Tax Return Instructions

California has one of the most extensive tax codes in the United States and it is also the one and only state that allows you to e-file a CA return without also e-filing your federal return. e-File both your IRS and CA returns on eFile.com so you only have to enter data once - refer to the resources below to answer some common CA tax questions.

How To?

Description

A: Access CA Forms

Step 1: Sign in to eFile.com
Step 2: Select State Taxes on the left menu.
On the right page, select I'd like to see the forms I've filled out or search for a form.
Step 3: Scroll to the CA State Forms drop-down and select the down arrow.
Step 4: Select the form in question, review or edit the entries, and save.
Step 5: As needed, use the CA search box to search for other forms or click on the links below the search box
Step 6: Click on Add Form next to the form name, complete, save and continue.

B: Exclude California Middle Class Tax Refund

Add the CA - Schedule CA - Income Adjustments page/screen - (follow instructions above under A). Once the page is added, go to the Line 8 detail tab at the top of the screen. Scroll about halfway down to the Middle Class Tax Refund entry. After you add your information, save and continue.
Federal Tax Return: According to the IRS, taxpayers are not required to report state initiated refunds of state taxes paid or welfare and disaster relief payments including the CA middle class tax refund unless you itemize your federal deductions.

C: Third-party sick pay

1. Check who paid for the policy.
2. If the employer paid for the policy, the sick pay is taxable and is reported on the W-2 in box 1.
3. If the taxpayer paid for the policy, the sick pay is not taxable. It might still be on the Form 8922 or Form W-2, but it should not be reported as long as the following apply: Box 1 - Wages is $0 or blank, Box 12 has code J, Box 12 - Nontaxable sick pay is checked.
4. The IRS would reject a W-2 with the entries shown under 3 above.
View an IRS notice on reporting sick pay paid by third parties.

D: Community Property Rights

Add Form 8958 - Allocation of Tax Amounts Between Certain Individuals (follow instructions above under A) to your federal return to determine the allocation of tax amounts between married filing separate spouses or registered domestic partners (RDPs). You will need to know your spouse's or partner's income. See page 3 for additional form 8958 instructions.

E: Part-Year Resident Tax Payment

As a CA part-year resident, if you were taxed for the full year but have paid taxes for the same income in another state, complete the screen "CA - Schedule S - Other State Tax Credit". This will indicate that these taxes were paid elsewhere or in another state so you only pay taxes for the time you resided in California. Follow the instructions above under A on how to add this form.

F: California Tax Return Residency Status

Find out if you are a part-year or nonresident California taxpayer.

G: California Renter's Credit

You will need this page: CA - 540/540NR Nonrefundable Renter's Credit. The other form - CA - 540/540NR Nonrefundable Renter's Credit - is not required if an "X" was entered on the 540/540NR format the top. Access the page as outline under A above.

H: CA Health Care Coverage

Details about California Individual Shared Responsibility Penalty Calculation for mandatory health care.

I: CA Tax Filing Instructions

Check your California state tax return instructions for the 2023 tax year.

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