2010 Filing Season Opens
We are now accepting 2010 state tax returns. Also, please note the following updates on law changes and filing services:
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, 2011, $360 million remains available. The credit must be claimed on a timely-filed original 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 must 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 modified adjusted gross income (PITL) or preapportioned income (CTL) of less than $300,000 or with disaster loss carryovers.
Voluntary Contribution Funds – Taxpayers can contribute to one or more charitable causes directly on 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.
Access Your Account – This new 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 online. Taxpayers and tax professionals complete a one-time registration where they choose their own user name and password. This service eliminates the need for taxpayers to get a customer service number each year.
MyFTB Account for Businesses – Coming in mid February 2011, business entities and their authorized tax representatives can view their prepaid estimated income tax payments online with MyFTB Account for Businesses. We encourage you to access My FTB Account for Businesses to verify estimated tax payments before filing, since claiming the wrong amount of estimated tax payments is a top processing error and errors delay refunds and result in tax bills after filing. Using this service you can also verify the exact entity name to use when filing the return, another common error causing processing delays. Go to ftb.ca.gov after February 14 and search for MyFTB Account.
Check Your Refund Status – After filing the 2010 tax return, taxpayers can use this service to see where their refund is. This service is also available in Spanish. In general, refunds for e-filed returns with direct deposit are generally issued within seven days and mailed refund checks are generally sent within two weeks. Refunds for paper-filed returns take longer, up to six to eight weeks depending on the time of year the return is filed.
Pay Taxes Online – Our Web Pay service allows taxpayers to authorize a payment from their bank account to pay their return balance due or extension payment. Payment must be made by 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 also pay their taxes online with their American Express, Discover/NOVUS, MasterCard, and Visa cards .
Request a Monthly Payment Plan – We offer monthly installment payment plans to those who cannot pay what they owe by the due date. 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.
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 up to $5,666. “Refundable” means that you do not have to have a tax liability to get a refund check from the federal government. If you think you might qualify, go to irs.gov and search for EITC Assistant. California has no comparable state credit.
Recordkeeping – Keep a copy of your client’s state tax returns and all supporting records. We may request information regarding your client’s tax return at any time within the California statute of limitations period, which is generally four years from the return's due date.