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CI7
Level 2

CA State Tax Return

I am trying to reconcile the answers I received in the replies (Subject of Original Message- "CA Form 3800") to what I am seeing in the turbo tax CA forms now that I have entered the information.  Specifically, the determination of the standard deduction for CA and determination of the CA tax.

 

1. Determination of the standard deduction for CA (forms 540NR/SCH CA (540NR)/Dep Std Ded)- as a reminder, my daughter has approx. $900 of CA W-2 income (her only CA income) and MO W-2 income (approx. $5,300) and MO passive income (approx. $2,800).  From an earlier reply, it sounded as if I should expect the CA standard deduction to be greater of CA W-2 wages plus $350 or $1,150.  However, in turbo tax I am seeing on the forms referenced above a standard deduction of $5,202 that is then prorated on SCH CA (540NR) based on the percentage of CA income to Total Income, ending in a CA standard deduction of approx. $500.   I follow the math; just want to make sure that the methodology (proration of the $5,202 standard deduction) to calculate the CA standard deduction of approx. $500 is the correct methodology?  If the methodology is correct, it impacts the next question as the CA standard deduction would be less than the CA W-2 income.

 

2.  Determination of the CA Tax- Because the CA standard deduction of approx. $500 is less than the CA W-2 Income of approx. $900, there is taxable income in CA based on the way the forms referenced above are working in turbo tax.  Turbo tax then calculates the tax on the CA taxable income of approx. $400.  The tax amount is $4.  

a.  If the standard deduction of $500 is correct, is a tax return required in CA, since there is $400 of taxable income?

b.  The earlier reply indicated that the CA Form 3800 is not required.  When I delete the form, the CA state tax check in turbo tax requires me to answer question on this form and puts it back into the mix- even though my daughter does not meet 2 of the 4 requirements listed below.  CA Form 3800 shows up in the return and calculates the tax on line 17.  In addition, 540NR calculates a tax liability on line 37.  Both CA Form 3800, line 17 and 540NR line 37 calculate a $4 tax liability (same amount but arrive at it in a slightly different way).  If a CA return is required, should I file the return with CA Form 3800 included since turbo tax includes it in the schedules?

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1 Best answer

Accepted Solutions
DaveF1006
Expert Alumni

CA State Tax Return

Yes and let's address each of your questions one at a time. Just to make sure though, I assume your daughter is under 18 or a full-time student under 24 and you are claiming her as a dependent on your return. This is the reason to file form 3800.

 

  1. The methodology for calculation of the standard deduction is correct based  on the percentage of CA income to total Income, 
  2. This does result in taxable income of $400, which results in a $4 tax liability.
  3. In answering your question, the $400 taxable income is derived from taking $900 and subtracting the $500 standard deduction. The standard deduction is already accounted for thus $400 is still taxable income.  You can't apply the standard deduction twice exclude taxable income.
  4. Do include form 3800 especially if your child falls under the provisions that I stated in my opening paragraph.
  5. I wish for continued success for you and your daughter in her education as well as successful pursuits in future endeavors.
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View solution in original post

1 Reply
DaveF1006
Expert Alumni

CA State Tax Return

Yes and let's address each of your questions one at a time. Just to make sure though, I assume your daughter is under 18 or a full-time student under 24 and you are claiming her as a dependent on your return. This is the reason to file form 3800.

 

  1. The methodology for calculation of the standard deduction is correct based  on the percentage of CA income to total Income, 
  2. This does result in taxable income of $400, which results in a $4 tax liability.
  3. In answering your question, the $400 taxable income is derived from taking $900 and subtracting the $500 standard deduction. The standard deduction is already accounted for thus $400 is still taxable income.  You can't apply the standard deduction twice exclude taxable income.
  4. Do include form 3800 especially if your child falls under the provisions that I stated in my opening paragraph.
  5. I wish for continued success for you and your daughter in her education as well as successful pursuits in future endeavors.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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