What You Need to Know This Tax Filing Season
Sacramento — Tax season kicks off this week at the Franchise Tax Board (FTB). Every year, FTB provides taxpayers with a list of important updates and reminders for the upcoming tax season.
“We encourage all Californians to make use of our online services, including the ability to file a state return online for free and quickly secure a refund,” said State Controller and FTB Chair Betty T. Yee. “More people than ever will qualify for key state tax credits, including the expanded California Earned Income Tax Credit and the Young Child Tax Credit. Combined, these refundable credits can total hundreds or even thousands of dollars. We hope more Californians will claim these credits, especially those who do not earn enough to be required to file. COVID-19 has affected everyone to varying degrees. We encourage people to file as early as possible and check their eligibility for each tax credit to get the full refund they deserve.”
Sacramento — Tax season kicks off this week at the Franchise Tax Board (FTB). Every year, FTB provides taxpayers with a list of important updates and reminders for the upcoming tax season.
“We encourage all Californians to make use of our online services, including the ability to file a state return online for free and quickly secure a refund,” said State Controller and FTB Chair Betty T. Yee. “More people than ever will qualify for key state tax credits, including the expanded California Earned Income Tax Credit and the Young Child Tax Credit. Combined, these refundable credits can total hundreds or even thousands of dollars. We hope more Californians will claim these credits, especially those who do not earn enough to be required to file. COVID-19 has affected everyone to varying degrees. We encourage people to file as early as possible and check their eligibility for each tax credit to get the full refund they deserve.”
ITIN Users Are Now Eligible for the California Earned Income Tax Credit (CalEITC)
Tax Credit (CalEITC)New this year, CalEITC eligibility expands to taxpayers with an Individual Taxpayer Identification Number (ITIN). Additionally, taxpayers who qualify for CalEITC and have at least one qualifying child under the age of six can get up to a $1,000 Young Child Tax Credit (YCTC). These cash-back state tax credits can lower the amount of tax owed or put money back into the pockets of California workers. When combined with the federal EITC, CalEITC and YCTC can be worth thousands of dollars to families. For more information about CalEITC, YCTC, and the federal EITC, visit www.ftb.ca.gov/caleitc.
Health Care Coverage Penalties for Tax Returns in 2021Last year, a new state law required Californians to have qualifying health insurance coverage throughout the year. Those who do not maintain qualifying medical coverage are subject to a penalty of $750 or more when they file their tax returns. The penalty for a dependent child is half of what it would be for an adult. A married couple without coverage could see a penalty of $1,500 or more, and for a family of four with two dependent children, it could be $2,250 or more. You can still get health coverage and financial help at CoveredCA.com. It is crucial to get health coverage now to avoid a penalty in 2022. For information, visit ftb.ca.gov/healthmandate.
Tax Credit (CalEITC)New this year, CalEITC eligibility expands to taxpayers with an Individual Taxpayer Identification Number (ITIN). Additionally, taxpayers who qualify for CalEITC and have at least one qualifying child under the age of six can get up to a $1,000 Young Child Tax Credit (YCTC). These cash-back state tax credits can lower the amount of tax owed or put money back into the pockets of California workers. When combined with the federal EITC, CalEITC and YCTC can be worth thousands of dollars to families. For more information about CalEITC, YCTC, and the federal EITC, visit www.ftb.ca.gov/caleitc.
Health Care Coverage Penalties for Tax Returns in 2021Last year, a new state law required Californians to have qualifying health insurance coverage throughout the year. Those who do not maintain qualifying medical coverage are subject to a penalty of $750 or more when they file their tax returns. The penalty for a dependent child is half of what it would be for an adult. A married couple without coverage could see a penalty of $1,500 or more, and for a family of four with two dependent children, it could be $2,250 or more. You can still get health coverage and financial help at CoveredCA.com. It is crucial to get health coverage now to avoid a penalty in 2022. For information, visit ftb.ca.gov/healthmandate.