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Changes to 2006 Form

Updates to 2006 Form 3506 Child and Dependent Care Expenses Credit

The revised Internet version is available for download as of 01/30/2008.

Revision Details: R1a and R1b: These changes reflect the new definition of earned income, which excludes nontaxable employee wages and allows a taxpayer to elect to include any nontaxable combat pay in the calculation.

  • This update is located on Form 3506: Revision 1a - Page 3, Column 1, Line 4, Box 1, 1st bullet. Revision 1b - Page 3, Column 1, Line 4, Box 2, 1st bullet. Both revisions are also located on Page 65 of the 540/540A Booklet and Page 237 of the Package X.

Previously read:

R1a - "...other taxable and nontaxable employee compensation including combat pay."
R1b - "...salary, tips, and other taxable and nontaxable employee compensation for working in California."

Revised to:

R1a - "...other taxable employee compensation, as well as, military compensation including compensation for services in a combat zone."
R1b - "...salary, tips, and other taxable employee compensation for working in California, as well as military compensation including compensation for service in a combat zone."

R1a and R1b: The current instructions are incorrect and may cause the taxpayer to calculate an incorrect amount for the credit. This revision will help taxpayers determine the correct amount of the credit.


2006 Update to Form 3506-Child and Dependent Care Expenses Credit

Revision Date: 03/27/07

Revision Details: FTB 3506 flat; 2006 Resident Booklet, page 61; and page 233 of the Package X.

  • Side 1, Line 3, a line was added to Part IV, therefore, what was line 34 is now line 35. Taxpayers may carry a lower amount over to Side 1, line 3 than should be reported which could reduce the amount of the credit. Reducing the credit increases a taxpayers tax liability.

It should read:

3 Add the amount in column (e) of line 2. Do not enter more than $3,000 for one qualifying person or $6,000 for two or more qualifying persons. If you completed Part IV, enter the amount on line 35.

This will impact taxpayers who used the on-line version of Form 3506 between 02/27/07 and 03/27/07.
The revised internet version is available for download.


2006 Update to Form 3506-Child and Dependent Care Expenses Credit

Revision Date: 03/05/07

Revision Details: FTB 3506 flat, Side 2; 2006 Form 540/540A Booklet, page 62; and page 234 of the Package X

  • Side 2, Part IV lines 33, 34, and 35

This revision is needed because a situation was discovered where FTB forms do not accurately compute the California CDC. This occurs where a taxpayer had child care expenses and employer benefits (W-2 box 10) from employment outside California, then moves to California and has California child care expenses but no employer benefits from the California employer, and the box 10 amount is less than the total allowable child care expenses for the year. In this situation, there is a federal credit allowable, since the employer benefits are less than the total allowable expenses, and the taxpayer should be allowed a California credit to the extent the allowable federal credit relates to California expenses and employment.

It should read:

33 Complete Side 1, Part III, line 2. Add the amount in column (e) and enter the total here.

34 Enter the amount from your federal Form 2441, Part III, line 32.

35 Enter the smaller of line 32, 33, or 34. Also enter this amount on Side 1, line 3 on the front of this form and complete line 4 through line 12.

This revision does have a tax impact because the taxpayer would have been entitled to a credit, but would not have received it. This revision needs to be noted in printed products 2006 FTB 3506 flat, side 2; 2006 Form 540/540A Booklet, page 62; and 2006 Package X, page 23.

The revised internet version is available for download.


2006 Update to Form 3506-Child and Dependent Care Expenses Credit

Revision Date: 03/05/07

Revision Details: Keying symbols were inadvertently left off the form.

  • Form 3506, Side 1, Part III, Column (b)

This revision does not have a tax impact. This revision needs to be noted in printed products 2006 FTB 3506 flat, side 1; 2006 Form 540/540A Booklet, page 61; and 2006 Package X, page 233.

The revised internet version is available for download.


2006 Update to FTB 3506

Revision Date: 03/05/07

Revision Details: Line 14 was added to side 2 of the Form 3506 to mirror changes made to IRS Form 2441. When this line was added all subsequent line numbers and references increased by one. This line number should have remained as 13 and was inadvertently changed.

  • Side 2, Part IV, Line 22

It should read:

22 Enter the amount from line 13 that you received from your sole proprietorship or partnership. If you did not receive any amounts, enter -0-.

This revision does not have a tax impact. This revision needs to be noted in printed products 2006 FTB 3506 flat, side 2; 2006 Form 540/540A Booklet, page 62; and 2006 Package X, page 234.

The revised internet version is available for download.

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