California state taxes at a glance
| Individual income tax | Graduated (bracket) income tax |
|---|---|
| Rate structure | Graduated rates starting at 1% and rising to 12.3% on the highest incomes, plus an extra 1% Mental Health Services Tax on taxable income above $1 million. Verify current brackets. |
| Tax agency | California Franchise Tax Board (FTB) |
| Main individual return | Form 540 (residents); Form 540NR for nonresidents and part-year residents |
| Local income taxes | No general local income taxes. Employees also pay State Disability Insurance (SDI) through payroll withholding. |
| Sales tax | A statewide base rate plus district and local add-ons, so the total varies by city and county. Administered by the CDTFA, not the FTB. |
| Property tax | Limited by Proposition 13: assessed value is generally reset at purchase and then can rise only by a capped percentage each year. Administered by counties. |
| Retirement & Social Security | California does not tax Social Security benefits. Other retirement income is generally taxed as ordinary income; check FTB guidance. |
Verify current-year figures: state rates, brackets, credits and filing rules change. Treat this page as a starting orientation and confirm details on the California Franchise Tax Board (FTB) website.
How California income tax works
California taxes residents on income from all sources and nonresidents on California-source income. The rate structure is steeply graduated: a low first bracket, many middle brackets, and a top rate that applies only to very high earners, with an added surcharge on income above $1 million. Because the brackets are indexed on California’s own schedule, they do not match federal brackets, and the federal marginal-rate system works differently.
California starts from your federal figures but does not conform to every federal rule. Its standard deduction is much smaller than the federal one, it has its own itemized-deduction rules, and it has historically not followed some federal changes. California also does not allow you to deduct California income tax on your California return. The practical result is that you should never copy a number from your federal return to your state return without checking the state instructions — good software handles the differences automatically.
Several features set California apart: personal exemption credits (rather than deductions), a nonrefundable renter’s credit with income limits, and its own refundable earned income credit (the California EITC) and Young Child Tax Credit for qualifying low-income workers. Eligibility and amounts change, so check the FTB’s current-year pages.
Filing your California return and free options
Most Californians file Form 540 by April 15 along with their federal return. The FTB runs MyFTB, an online account for checking refund status, making payments and viewing notices. California has historically offered state-run free filing (CalFile) for eligible simple returns and has participated in the free filing ecosystem alongside the IRS Free File program; because programs and eligibility change from year to year, check the FTB’s current-year “free file” page before assuming a specific option exists.
If you cannot pay, the FTB offers payment plans online. If you need extra time to file, California generally grants an automatic extension to file (not to pay) — pay what you expect to owe by the original due date to limit penalties and interest. Our general guides on tax extensions and state refund status explain the concepts.
For the federal side, see our guides to free federal filing options and the complete guide to filing taxes.
Things California residents often ask about
- Sales tax comes from the CDTFA, not the FTB. Sellers, including many online sellers, register with the CDTFA.
- SDI withholding on your paycheck is a disability insurance contribution, not income tax.
- Moving in or out? Part-year residents file Form 540NR and prorate income by residency; keep dates and documents.
- Property tax is bill-based from your county and separate from your income tax return.
- Gig and self-employed Californians also face the federal self-employment tax and the state’s minimum franchise tax if they form an LLC or corporation (check FTB for current amounts).
Official California links
- California FTB: individuals
- California CDTFA (sales and use tax)
- California EDD (SDI and unemployment)
- Federation of Tax Administrators: State tax agencies
Frequently asked questions
Does California tax Social Security benefits?
California does not tax Social Security benefits as of our latest review. Other retirement income is generally taxable; confirm with the FTB.
What is the California income tax filing deadline?
Generally April 15, the same as the federal deadline, with an automatic extension to file available. An extension to file is not an extension to pay.
Is there free state filing in California?
California has offered state-run and partner-based free options in the past, but availability and income limits change yearly. Check the FTB website for the current list.
General information only — not tax, legal or financial advice. Tax figures change every year; verify the current numbers at IRS.gov or with a qualified professional. Read the full disclaimer.