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STATE TAX CHANGES FOR CALIFORNIANS

 STATE TAX CHANGES FOR CALIFORNIANS
 SACRAMENTO, Calif., Jan. 9/ PRNewswire/ -- The annual state and


federal holiday tax greetings have no doubt arrived, and now begins the task of pulling out last year's records and sharpening pencils.
 More than 2 million Californians will be affected by state tax law changes when they file their 1991 state income tax return, announced the Franchise Tax Board (FTB).
 Last year brought about many changes to the calculation of credits and deductions. But the good news for California's nearly 14 million state income tax filers is that over one-half will still be eligible to file the state's shorter and simpler form, 540A.
 The most noticeable of the new law changes concerns limitations on renter's credit, itemized deductions, and personal exemption credits. Other main changes affect extensions of time to file, increased tax rates for high income taxpayers, and a stay at home parent credit.
 The following is a brief description of the more significant changes:
 Renter's Credit Limitation. The amount of the refundable credit is now based on the amount of California adjusted gross income. For single filers, the $60 credit is reduced to $30 if the income is greater than $20,000 and less than $20,500. The credit is eliminated if the income exceeds $20,500. For married filing joint and head of household filers, the $120 credit is reduced to $60 if the income is greater than $40,000 and less than $41,000. The credit is eliminated if the income exceeds $41,000.
 Limitations on Itemized Deductions. The limitation on itemized deductions only affects higher income taxpayers. Single filers whose federal adjusted gross income exceeds $100,000, head of household filers whose income exceeds $150,000, and married filers whose income exceeds $200,000 are subject to reduced itemized deductions.
 Personal Exemption Credit Phase-Out. The amount of personal exemption credit is phased out when federal adjusted gross income exceeds a threshold amount. The threshold amounts are $200,000 for married filing joint, $150,000 for head of household, and $100,000 for single filers. Each credit is reduced by $6 for each $2,500 exceeding the threshold amount.
 Automatic Extension of Time to File. Californians will now be given an automatic six-month extension until Oct. 15, to file their state income tax return without the need to file a written request. An extension is for additional time to file and not to pay.
 If there is a balance due, payment must still be made by the original due date or be subject to penalties. Payment of the balance due may be made with the new payment voucher, FTB 3519, which is included in the tax booklets this year.
 The Franchise Tax Board encourages the more than 8 million taxpayers who qualify for a refund each year to file early.
 New Tax Rates. High income filers will find the top tax rates have been raised from 9.3 percent to 11 percent. For single filers, earnings over $100,000 but less than $200,000 will be subject to a 10 percent tax rate, and earnings over $200,000 will be subject to the 11 percent top tax rate. For married filers, earnings over $200,000 but less than $400,000 will be subject to the 10 percent tax rate, and earnings over $400,000 will be subject to the 11 percent top tax rate.
 Stay at Home Parent Credit. This credit allows a parent who chooses to stay home for the first year of a newborn's life to receive an $86 a month credit up to $1,000. This credit is available this year for a parent who stayed home last year.
 Fast answers to state tax questions are available by calling 800-338-0505. This automated service provides recorded messages to the most frequently asked questions. Taxpayers must have their 1991 tax booklet with them and a touch tone phone to use this service. The phone service is available Monday through Friday 6 a.m. to 10 p.m.
 -0- 1/9/92
 /CONTACT: Jim Reber or Jim Shepherd of the California Franchise Tax Board, 916-369-4800/ CO: California Franchise Tax Board ST: California IN: FIN SU:


RM -- SF008 -- 8408 01/09/92 16:55 EST
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Publication:PR Newswire
Date:Jan 9, 1992
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