California State Income Tax Filing
1% to 13.3%
Top marginal rate
13.3% including the 1% surcharge above $1 million
Brackets
Nine graduated bands before the surcharge
Standard deduction
$5,540 single / $11,080 joint — far below the federal figure
Capital gains
Taxed as ordinary income, with no preferential rate
California income tax at a glance
California has the highest top marginal income tax rate in the country and one of the most aggressive approaches to residency, which is a combination worth understanding before you file. The rate schedule is genuinely graduated — nine brackets before the surcharge — so a mid-career salary lands nowhere near the headline 13.3%. What catches people is not the rate but the sourcing: California taxes residents on worldwide income and non-residents on California-source income, and it applies a facts-and-circumstances test to residency rather than a day count. If you moved in or out during the year, hold RSUs vested partly while you lived elsewhere, or work remotely for a California employer from another state, the question of how much of your income California can reach is a real one and not something software resolves for you.
California tax rates
| Rate | Taxable income |
|---|---|
| 1% | $0 – $11,079 |
| 2% | $11,079 – $26,264 |
| 4% | $26,264 – $41,452 |
| 6% | $41,452 – $57,542 |
| 8% | $57,542 – $72,724 |
| 9.3% | $72,724 – $371,479 |
| 10.3% | $371,479 – $445,771 |
| 11.3% | $445,771 – $742,953 |
| 12.3% | $742,953 – $1,000,000 |
| 13.3% | $1,000,000 and over |
California tax rates for single filers: 1% from $0 to $11,079; 2% from $11,079 to $26,264; 4% from $26,264 to $41,452; 6% from $41,452 to $57,542; 8% from $57,542 to $72,724; 9.3% from $72,724 to $371,479; 10.3% from $371,479 to $445,771; 11.3% from $445,771 to $742,953; 12.3% from $742,953 to $1,000,000; 13.3% above $1,000,000.
California tax rates for married filing jointly: 1% from $0 to $22,158; 2% from $22,158 to $52,528; 4% from $52,528 to $82,904; 6% from $82,904 to $115,084; 8% from $115,084 to $145,448; 9.3% from $145,448 to $742,958; 10.3% from $742,958 to $891,542; 11.3% from $891,542 to $1,000,000; 12.3% from $1,000,000 to $1,485,906; 13.3% above $1,485,906.
- Standard deduction
- $5,540 single · $11,080 joint
- Personal exemption
- Structured as a credit — $153 single, $306 joint, $153 per dependent
Rates and thresholds as of . State legislatures change these mid-year and several states index brackets annually — check against California Franchise Tax Board before relying on a figure.
What to watch out for in California
- California does not have a reduced rate for long-term capital gains. A stock sale that qualifies for 15% federally is taxed at your full California marginal rate, which is the single most commonly missed part of a California tax bill.
- The state standard deduction is roughly a third of the federal one, so many people who take the standard deduction federally are better off itemising for California. The two decisions are separate.
- California also levies a state disability insurance contribution on wages, withheld by your employer and shown separately on your payslip. It is not income tax and is not part of the rates above.
- Residency is decided on where your closest connections are, not on a fixed number of days. Keeping a California home, licence or dependants in the state while working elsewhere is often enough to keep you a resident.
Forms and deadlines
- Which form
- Form 540 for residents, Form 540NR for non-residents and part-year residents
- Deadline
- Aligns with the federal deadline, and California grants an automatic filing extension without a form.
- State authority
- California Franchise Tax Board
Federal deadlines are separate from state ones. Our US tax deadlines page covers the federal calendar, and the federal tax brackets apply on top of whatever California charges.
Where these figures come from
Rates, bracket floors, standard deductions and exemptions are taken from the compilation below, stated as of January 1, 2026 and built from state statutes, forms and instructions. The state authority is always the final word on your own position.
Reviewed by Teja K, CPA · last reviewed . General information, not tax advice for your situation. State tax law changes frequently — confirm before acting.
California tax questions
What is the California state income tax rate?
California uses nine graduated brackets running from 1% to 12.3%, with an additional 1% mental health services surcharge on taxable income above $1 million, giving a top marginal rate of 13.3%. As with federal tax the rates are marginal, so reaching a bracket does not apply that rate to your whole income. Figures are as of January 1, 2026.
Do I have to file a California return if I moved during the year?
Almost certainly yes, on Form 540NR as a part-year resident. You are taxed on all income received while you were a California resident plus any California-source income from the rest of the year. Allocating income across the two periods correctly — particularly bonuses, RSU vesting and severance that straddle the move — is where part-year returns go wrong, and it usually goes wrong in California's favour.
I work remotely for a California company from another state. Do I owe California tax?
Generally the source of wage income is where the work is physically performed, so if you never work in California the wages are usually not California-source. That said, your employer may withhold California tax anyway, in which case you file a non-resident return to recover it. Trips into the state for work create genuinely California-source income for those days. This is one of the most frequently misunderstood positions and worth getting right rather than assuming.
Does California tax capital gains at a lower rate?
No. Long-term and short-term gains are both taxed as ordinary income at your full marginal rate. A gain taxed at the federal 15% long-term rate can face a California rate approaching double that, which materially changes the after-tax result of a sale. Planning the timing of a large sale around a state move is a real consideration, and one California scrutinises.
Can non-residents claim the California standard deduction?
Part-year and non-resident filers use Form 540NR, which prorates deductions and credits based on the ratio of California income to total income rather than granting them in full. The mechanics differ from the federal treatment of non-residents, so a position that is correct on your federal return is not automatically correct for California.
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