Tax season is in full swing at the Franchise Tax Board, and officials want to alert taxpayers to changes for this year and urge them to take advantage of online services to file taxes and secure their refunds as quickly as possible.
“More people will qualify for state tax credits this year, and there are free tax assistance programs available to Californians,” said Betty T. Yee, state controller and FTB chairwoman. “Visit the Franchise Tax Board online to learn about free tax preparation sites, e-file options, valuable tax credits and more.”
This year, an estimated 3 million families are expected to claim California’s expanded Earned Income Tax Credit (CalEITC). Taxpayers with income up to $30,000 may qualify for CalEITC.
Those who qualify for CalEITC and have a child under the age of 6 may also receive up to $1,000 worth of the new Young Child Tax Credit (YCTC). An estimated 400,000 families may be eligible to claim YCTC.
Taxpayers earning less than $55,952 may also qualify for the federal EITC. Between CalEITC, YCTC and the federal EITC, a family can receive up to $8,053.
CalEITC and YCTC are claimed by filing a state tax return, while federal EITC is claimed on a federal return.
For more information on CalEITC, YCTC and the federal EITC, visit CalEITC4me.org, ftb.ca.gov/caleitc or irs.gov.
State health-care mandate
Effective Jan. 1, a new state law requires Californians to have qualifying health insurance coverage throughout the year. Those who fail to maintain qualifying coverage are subject to a penalty when they file their tax returns in 2021.
Generally speaking, a taxpayer who fails to secure and keep qualifying medical coverage will be subject to a penalty of $695 or more. The penalty for a dependent child is half of what it would be for an adult. The penalty for a married couple without coverage can be $1,390 or more, and the penalty for a family of four with two dependent children could be $2,085 or more.
For more information on health coverage options and financial assistance, visit CoveredCA.com.
For more information on the penalty, visit ftb.ca.gov/healthmandate.
The California Labor and Workforce Agency has developed a list of frequently asked questions that have been posted on its website (labor.ca.gov/employmentstatus) to help the public understand the newly enacted Assembly Bill 5, which regulates the so-called gig economy.
For more information, visit ftb.ca.gov/file/business/industries/gig-economy.html.
FTB’s MyFTB service enables taxpayers to view their tax documents, check balances due, access tax calculators, send secure messages to FTB staff, and more. FTB offers free electronic filing for state tax returns through CalFile.
For more information, visit ftb.ca.gov/file/ways-to-file/online/calfile.