Instructions For Schedule Ca (540nr) - California Adjustments - Nonresidents Or Part-Year Residents - 2007

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Instructions for Schedule CA (540NR)
References to these instructions are to the Internal Revenue Code (IRC) as of January 1, 2005, and the California Revenue and Taxation Code (R&TC).
What’s New
Purpose
Use this schedule to determine California taxable income by doing the
Registered Domestic Partners (RDP)
following:
Effective for taxable years beginning on or after January 1, 2007, RDPs
under California law must file their California income tax returns using either
• Identify the domiciles and also, current and past residency information.
the married/RDP filing jointly or married/RDP filing separately filing status.
• Enter the amounts of income and deductions reported on your federal
RDPs will have the same legal benefits, protections, and responsibilities as
income tax return.
married couples unless otherwise specified.
• Adjust the income and deductions reported on your federal return for
differences in California and federal law.
If you are a domestic partner who has registered with the California Secretary of
• Determine the portion of income reported on your federal return that was
State, effective for taxable years beginning on or after January 1, 2007, you must
earned or received while you were a California resident.
file a California nonresident income tax return using either the married/RDP filing
• Determine the portion of income reported on your federal return that was
jointly or married/RDP filing separately filing status.
earned or received from California sources while you were a nonresident.
If you entered into in a same sex legal union in another state, other than a
• Determine your allowable standard deduction or itemized deductions.
marriage, and that union has been determined to be substantially equivalent to a
Part-Year Residents – Complete the Part-Year Resident Worksheet on
California registered domestic partnership, effective for taxable years beginning
page 10 to determine the amounts to enter on Part II, line 7 through line 22a,
on or after January 1, 2007, you are required to file a California nonresident
income tax return using either the married/RDP filing jointly or married/RDP
column E.
filing separately filing status. For more information on what states have legal
Avoid common mistakes on this schedule.
unions that are considered substantially equivalent, go to our Website at www.
Column A – Copy the amounts from your federal return. Using the
ftb.ca.gov and search for RDP.
(a) amounts on line 9 and the (b) amounts on line 15, line 16, and line 20,
For purposes of California income tax, references to a spouse, a husband, or
use the line (b) amounts from your federal return. Form 1040, line 37,
a wife also refer to a California Registered Domestic Partner (RDP), unless
should equal Long Form 540NR, line 13, federal AGI.
otherwise specified. When we use the initials (RDP) they refer to both a
Column B (line 7 - line 2) – Subtract income that is not taxable to a
California Registered Domestic “Partner” and a California Registered Domestic
California resident such as California lottery winnings and social security
“Partnership,” as applicable. For more information on RDPs, get FTB Pub. 737,
benefits. Do not use column B to deduct income that was earned while a
Tax Information for Registered Domestic Partners.
nonresident of California or from sources outside of California. There must
Conformity
be a difference in state and federal tax law. Generally, if a full-year California
For updates regarding the following federal act, go to our Website at www.
resident cannot subtract the income in column B, a nonresident or part-year
ftb.ca.gov and search for conformity.
resident may not subtract the income in column B either.
• Small Business and Work Opportunity Tax Act of 2007
Column C (line 7 - line 2) – Add income that was not taxed on your federal
• Mortgage Forgiveness Debt Relief Act of 2007
return but is taxable to a California resident such as foreign income or
interest/dividends from non-California municipal bonds.
General Information
Column D – Combine the columns (column A - column B + column C).
Line 37, column D, should equal Long Form 540NR, line 17. The amounts in
In general, California law conforms to the Internal Revenue Code (IRC) as of
this column represent income earned from all sources as if you were a full-
January 2005. However, there are continuing differences between California
year California resident, after applying California and federal law differences.
and federal law. When California conforms to federal tax law changes, we
do not always adopt all of the changes made at the federal level. For more
Column E – Enter all income from all sources while a resident of California
information, go to our Website at and search for conformity.
and income from California sources while a nonresident. Enter on line 45 the
Additional information can be found in FTB Pub. 1001, Supplemental
amount from Schedule CA (540NR), line 37.
Guidelines to California Adjustments, the instructions for California Schedule
Specific Line Instructions for
CA (540 or 540NR), and the Business Entity tax booklets.
Part I Residency Information
The instructions provided with California tax forms are a summary of
California tax law and are only intended to aid taxpayers in preparing their
Answer all the questions in this part for you and your spouse/RDP. If a
state income tax returns. We include information that is most useful to the
question does not apply, enter “N/A” on the line for the answer. For more
greatest number of taxpayers in the limited space available. It is not possible
information get:
to include all requirements of the California Revenue and Taxation Code
(R&TC) in the tax booklets. Taxpayers should not consider the tax booklets
• FTB Pub. 1031, Guidelines for Determining Resident Status
as authoritative law.
• FTB Pub. 1032, Tax Information for Military Personnel
The California legislature enacted SB 615 (Stats. 2004.CH.388), which
Line  – Domicile and military
makes California law compatible with the Servicemembers Civil Relief Act
If you served in the military, your state of domicile is generally the state where
(Public Law 108-189). This means that servicemembers domiciled outside
you were living when you first entered military service. If you were not in the
of California and their spouses/RDPs may exclude the servicemember’s
military, your domicile is the place you consider your permanent home, the
military compensation from gross income when computing the tax rate on
place to which you, whenever absent, intend to return.
nonmilitary income.
Line 5 – The number of days I spent in California
Requirements for military servicemembers domiciled in California remain
The total number of days in California should include all days in California for
unchanged. Military servicemembers domiciled in California must include
any purpose including residency, business, and vacation.
their military pay in total income. In addition, they must include their military
Specific Line Instructions for
pay in California source income when stationed in California. However,
military pay is not California source income when a servicemember is
Part II Income Adjustment Schedule
permanently stationed outside of California.
Column A — Federal Amounts
Amended Returns – If you are an active duty military servicemember
domiciled outside California and you included your military compensation
Enter all the amounts shown on your federal return on the corresponding
in income from all sources, you may file an amended return for tax years
lines in column A.
with an open statute of limitations. Get FTB Pub. 1032, Tax Information for
If married/RDP filing separately under either exception described in the
Military Personnel, and Form 540X, Amended Individual Income Tax Return,
instructions for Long Form 540NR, enter in column A the amounts you
for additional information.
would have reported on a separate federal return. Attach a statement to the
Schedule CA (540NR) Instructions 2007 (REV 01-08) Page 

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