1. Ashley Schultz Volunteer Program Coordinator
Franchise Tax Board
Ashley Schultz
Volunteer Program Coordinator
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2. AARP This Presentation is designed to:
Assist you in completing State of California Tax Returns.
Provide a reference while using TaxSlayer software.
For tax law information please consult the 2017 Counselor Reference Manual, or the 540 Booklet.
Presentation objectives.

3. What Publications Will Help?
540 Booklet
Publication 1001 – California Adjustments
Publication 1005 – Pension and Annuity Guidelines
Publication 1540 – California Head of Household
Let the instructors know these publications can be found on our web site The 1001 and 1005 may not be fully updated by January, but even last year’s version will help a lot. The Pub 1540 may help answers any HOH questions instructors and volunteers might have.

5. California Earned Income Tax Credit (EITC)
The CA EITC is "refundable," meaning that you will receive a refund if the amount of the credit is greater than the tax you owe
This credit is available to California households with adjusted gross income of less than $15,009 if there are no qualifying children, less than $22,322 if there is one qualifying child, or less than $22,309 if there are two or more qualifying children
Maximum credit amounts are $223 with no qualifying children, $1,495 with one qualifying child, $2,467 with two qualifying children, and $2,775 with three or more qualifying children
Definition of a refundable credit. The new thresholds for the credit. The maximum credit amounts qualifying taxpayers can expect back.

6. California Earned Income Tax Credit (EITC)​
Like the federal EITC, income from self-employment can be used to qualify for the California credit
You must file a state tax return, even if you do not owe any tax or are not otherwise required to file
Self employment can now be used. In order to claim the credit, taxpayers must file a return.

7. California Earned Income Tax Credit (EITC)​
You, your spouse, and any qualifying children must each have a social security number issued by the Social Security Administration that is valid for employment.
You must file using the single, married/registered domestic partner (RDP) filing jointly, or head of household filing status
The “married/RDP filing separately” status may not be used.
Your principal residence must be in California for more than half the tax year
Rules to qualify for the credit.

8. California Earned Income Tax Credit (EITC)​
FTB 3514, California Earned Income Tax Credit, must be completed and filed with return to claim credit
The credit amount, if you qualify, is on line 23 of the 540 2EZ, line 75 of the 540 return, line 82 of the 540NR (short) and line 85 of the 540NR (Long)
Taxpayers who would like to file returns to claim EITC are being encouraged to use the Volunteer Program to prepare those returns
Rules continued.

9. Click on the Add State Return button to add a California return for the taxpayer
If a state was not automatically added to return, this screen will come up after the federal return is completed. Click on the green button to add the state return.

10. Click on the state or select from the drop down on the right hand side of the screen.
You have a choice of the map or the pull down on the right. If you click on the state, the pull down will automatically go to that state.

11. Select the type of California return you would like to prepare (in most cases this will be a resident return).
Add a resident return. Most sites do only resident returns

12. Renter’s Credit

13. If your taxpayer qualifies, answer yes and the software takes care of putting the credit on the CA return.
Renter’s Credit income limits are $40,078 for single and $80,156 for married filing joint, head of household and qualifying widow(er).

14. If taxpayer has a tax liability, renter’s credit will help reduce that liability
The credit amount will be added to the CA return if the renter’s credit question is answered “yes”. If the tax payer has no liability or doesn’t qualify, the amount is not used in the calculation of tax liability.

15. Child and Dependent Care

16. The information entered on the federal form 2241 is transferred to the CA Form The provider’s phone number is mandatory for California.
It’s important for the instructors to pass on to their students that some of the information needed on the state return is completed on the federal side. This is an example of that. The child care provider’s phone number needs to be entered as the fed form This information is then transferred to the state form with no addition entries needed.

17. Interest

18. To subtract interest taxed by the feds and not by the state, enter the amount and the state in the appropriate boxes.
Second example of information entered on the fed side that will flow to the CA return. Savings bond interest is not taxable to California. The adjustment is made as the interest is entered on the fed side. The arrows indicate where to enter interest that is not taxable to the state. Choose the state that you are filing a return for. A cross check to see if the information was entered correctly will be to look at the Sch CA and make sure the interest is in Column B.

19. HOH Filing Status

20. For the FTB Form 3532, Head of Household Filing Status schedule, complete this worksheet under the state basic information section.
Add the information requested and answer the questions. Emphasize this form needs to be completed if the HOH filing status is used on the return. This screen shot is from the 2016 software and may change with 2017 software.

21. More on CA EITC

22. Because self-employment income is accepted for CA EITC, there’s a new information area on the Form 3514
This section of the FTB 3514 is new. We don’t know what this will look like in the software at this time. If the taxpayer does not submit this information on the form, there is a real good chance they will contacted by the FTB and their return will not be processed quickly. Preparers should fill in as much information as they can get from the taxpayer.

23. IHSS Payments

24. In Home Supportive Services (IHSS) Payments
Those that qualify for the waiver (live with the person they give care to) are required to waive the income from giving care in this block on the federal side. This is at the bottom of the W-2 information. This information also affects the CA return if the total income is low enough to qualify for EITC.

25. In Home Supportive Services (IHSS) Payments
On the state side under the credit section, CA EITC, a second entry is provided so IHSS will not be counted towards CA EITC. As long as the total income does not go over the qualification amount for the filing status, any income left over after this subtraction is made, would be used to calculate any CA EITC the taxpayer is entitled to.

26. Refunds

27. On the State E-file screen, select direct deposit if the taxpayer would like their refund to drop straight into their bank account.
2017 E-file screen. Go over all the choices offered for the refund. E-file with paper check means the return will be filed electronically, refund will come back by check. E-file direct deposit means the return will be filed electronically, refund will be directly deposited in the Taxpayers account. Paper with direct deposit means the taxpayer will send their return in the mail with banking information to receive a direct deposit of refund. Paper returns will be mailed in and a refund check will mailed back to the taxpayer.

28. Enter banking information for direct deposit under the state return section.
The highlighted box is very important. Banking information entered must be accurate. CA does allow refund splitting, but TaxSlayer does not support this feature for a state refund. (At least it didn’t for 2016) Account type is usually defaulted to checking but may be changed to savings. A bank does not have to be entered. The routing and account numbers should be taken from the bottom of a check or previous year’s return. Make sure to ask the taxpayer if they have changed banks if information is used from a previous year’s return.

29. New for TY 2017
Starting with TY2017 you can e-file an amended return (if supported by our software)
If TaxSlayer supports, amended returns can be e-file by checking this box. We don’t know what it’s going to look like in the software yet. If supported a Schedule X will also have to be completed with the return.

30. A CA Schedule X will need to accompany the amended return to explain why the return is being amended
The New Schedule X needs to be filled out if the amended check box is filled in on the front of the We don’t know what this will look like in the software yet (if supported).

31. Voluntary Contributions
Etc.
Voluntary Contributions
Use when State ID number box is blank.
Explain how voluntary contributions work. Contributions decrease refunds and increase tax liabilities.
Six 9’s can be used in place of a blank state ID number on the W-2.

32. Where do I get help? Volunteer Hotline – 1.800.522.5665
Operating hours – Monday thru Friday
(except state and fed holidays)
8 A.M. until 4:00 P.M.
What is the State Holiday that occurs during filing season?

33. Questions?
Remind the volunteers of where to get help, if needed, during the filing season. Thank them for their time and attention during your class, and for volunteering during the tax season.

34. Thank you for volunteering! California Volunteers Make the Difference
The End!