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Old 08-08-2010, 05:42 PM
 
8 posts, read 32,653 times
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I am in the process of moving to California from Texas for a job. I am trying to understand the state income tax, could use a little help. Is it similar to federal income tax - where you get deductions for dependents, donations, mortgage interest, etc...? Or, is the gross income just "every dollar earned"? I would be in the highest rate at my salary based on what I have seen (9.3%?) Also - from what I understand is deducting what you pay on state income tax from your federal income tax will likely land folks like me at the AMT for federal tax. Thanks for any help you can provide!!! Any tips would really be appreciated.
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Old 08-08-2010, 06:07 PM
 
Location: Sacramento
14,044 posts, read 27,219,039 times
Reputation: 7373
Quote:
Originally Posted by movintocalifornia View Post
I am in the process of moving to California from Texas for a job. I am trying to understand the state income tax, could use a little help. Is it similar to federal income tax - where you get deductions for dependents, donations, mortgage interest, etc...? Or, is the gross income just "every dollar earned"? I would be in the highest rate at my salary based on what I have seen (9.3%?) Also - from what I understand is deducting what you pay on state income tax from your federal income tax will likely land folks like me at the AMT for federal tax. Thanks for any help you can provide!!! Any tips would really be appreciated.
Generally deductions track the federal process, but you add back in your state income tax writeoff.
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Old 08-08-2010, 06:12 PM
 
Location: Escondido, CA
1,504 posts, read 6,152,085 times
Reputation: 886
Quote:
Is it similar to federal income tax - where you get deductions for dependents, donations, mortgage interest, etc...?
Yes. Deductions may vary slightly, but it works similar to the federal tax. One significant difference is that all your capital gains are taxed at the same level as your salary.

Quote:
I would be in the highest rate at my salary based on what I have seen (9.3%?)
Only the income above certain point is taxed at 9.3%. For example, a married couple making $60,000/year would owe around $1,900 in taxes.

Quote:
Also - from what I understand is deducting what you pay on state income tax from your federal income tax will likely land folks like me at the AMT for federal tax
It might. Depends on the circumstances. In any case, you wouldn't pay more federal taxes than if you didn't have any state income tax.
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Old 08-08-2010, 06:23 PM
 
Location: Malibu/Miami Beach
1,069 posts, read 3,272,213 times
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California Tax Service Center - Homepage

The highest rate is 10.55%..= 9.55% +1% for mental health????

Last edited by impala666; 08-08-2010 at 06:44 PM..
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Old 08-08-2010, 06:42 PM
 
Location: Dalton Gardens
2,852 posts, read 6,485,150 times
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Impala66! I haven't seen you since I stopped posting on the AZ forums Are you in California now, too?
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Old 08-08-2010, 06:48 PM
 
Location: Malibu/Miami Beach
1,069 posts, read 3,272,213 times
Reputation: 443
Quote:
Originally Posted by Cyanna View Post
Impala66! I haven't seen you since I stopped posting on the AZ forums Are you in California now, too?
I now live in Arizona but still haunt the LA forum.
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Old 08-08-2010, 06:59 PM
 
Location: Dalton Gardens
2,852 posts, read 6,485,150 times
Reputation: 1700
Quote:
Originally Posted by impala666 View Post
I now live in Arizona but still haunt the LA forum.
Ahhhhhh, I see If you recall a few years back I was originally planning on moving back to AZ from England, but we ended up in my home state of California instead, LOL! Stuck in Van Nuys for the next two months, and then back to Simi Valley, FINALLY!
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Old 08-08-2010, 07:16 PM
 
Location: Malibu/Miami Beach
1,069 posts, read 3,272,213 times
Reputation: 443
My kids left to do stuff, my son is at university in London but he intends to move back to Malibu when he has finished and my daughter is stopping with my best friends ex-wife and has an acting contract. While I'm in the desert playing with laser beams and avoiding California tax.
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Old 08-08-2010, 07:22 PM
 
Location: Dalton Gardens
2,852 posts, read 6,485,150 times
Reputation: 1700
Your son is in London? Is he enjoying it? Personally, I didn't like London, but the younger generations seem to love the place Your daughter has an acting contract! Well done! We know how hard it is to truly break into the business with so many other contenders. Its quite an accomplishment. I am too tired to dodge California taxes, I just look forward to moving back to sedate and peaceful Simi Valley, LOL!
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Old 08-08-2010, 07:27 PM
 
Location: Santa Barbara
514 posts, read 686,858 times
Reputation: 175
Use turbo tax and get the Fed and State, it takes care of your deductions etc.

There are those who complain of high California Taxes, yet, I did a little research, Nevada ranks 43third for taxes, and California ranks 8th.

That makes it sound like Nevada is worth moving to, right? And folks complain of California taxes and head off to Nevada "the low tax state".

Yet, if you make $50,000 a year, in Nevada your tax burden is about $3500.00, while in California you will pay about $5,000. A difference of about $1500 a year.

Considering that Nevada ranks 47th for business friendly mainly due to the lack of services and infrastructure,

$1500 is not onerous.
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