Form 3800 - Tax Computation For Certain Children With Investment Income

2014 Instructions for Form FTB 3800

Tax Computation for Certain Children with Investment Income

References in these instructions are to the Internal Revenue Code (IRC) as of January 1, 2009, and to the California Revenue and Taxation Code (R&TC).

General Information

If the parents were unmarried, treated as unmarried for tax purposes,

or separated either by a divorce or separate maintenance decree, enter

For taxable years beginning on or after January 1, 2010, California

the name and SSN or ITIN of the parent who had custody of the child for

conforms to the provision of the Small Business and Work Opportunity

most of 2014.

Act of 2007 which increased the age of children to 18 and under or

Exception. If the custodial parent remarried or entered into an RDP and

a student under age 24 for elections made by parents reporting their

filed a joint return with the new spouse/RDP, enter the name and SSN or

child’s interest and dividends.

ITIN of the person listed first on the joint return, even if that person is

Registered Domestic Partners (RDP) – For purposes of California

not the child’s parent. If the custodial parent and the new spouse/RDP

income tax, references to a spouse, husband, or wife also refer to a

filed separate California tax returns, enter the name and SSN or ITIN of

California RDP, unless otherwise specified. When we use the initials

the person with the higher taxable income, even if that person is not the

RDP they refer to both a California registered domestic “partner” and

child’s parent.

a California registered domestic “partnership,” as applicable. For more

If the child’s parents were unmarried but lived together during the year

information on RDPs, get FTB Pub. 737, Tax Information for Registered

with the child, enter the name and SSN or ITIN of the parent who had the

Domestic Partners.

higher taxable income.

Purpose

Part I Child’s Net Investment Income

For certain children, investment income over $2,000 is taxed at the

Line 1 – Enter the child’s investment income. Include income such as

parent’s rate if the parent’s rate is higher. Use form FTB 3800, Tax

taxable interest, dividends, capital gains, rents, annuities, and income

Computation for Certain Children with Investment Income, to figure the

received as a beneficiary. In most cases, this will be the same as the

child’s tax.

amount entered on federal Form 8615, however you should only include

Complete form FTB 3800 if all of the following apply:

income taxable by California. Also, include investment income that was

not taxed on the child’s federal tax return but is taxable under California

• The child is 18 and under or a student under age 24 at the end of

law. For more information, get the instructions for Schedule CA (540 or

2014. A child born on January 1, 1997, is considered to be age 18 at

540NR), line 8 and line 9.

the end of 2014. A child born on January 1, 1991, is considered to be

age 24 at the end of 2014.

If the child had earned income (defined below), use the following

• The child had investment income taxable by California of more

worksheet to figure the amount to enter on form FTB 3800, line 1.

than $2,000.

1. Enter the amount of the child’s adjusted

• At least one of the child’s parents was alive at the end of 2014.

gross income from Form 540, line 17 or

• The child was age 18 at the end of 2014 and did not have earned

Long Form 540NR, line 17, whichever applies . . . . . . 1 __________

income that was more than half of the child’s support.

2. Enter the child’s earned income. . . . . . . . . . . . . . . . . . 2 __________

If the child uses form FTB 3800, file Form 540, California Resident

(wages, tips, and other payments received

Income Tax Return, or Long Form 540NR, California Nonresident or

for personal services performed)

Part-Year Resident Income Tax Return.

3. Subtract line 2 from line 1. Enter the result

If the child does not file form FTB 3800, figure the tax in the normal

here and on form FTB 3800, line 1 . . . . . . . . . . . . . . . 3 __________

manner on the child’s Form 540, or Long or Short Form 540NR.

Line 2 – If the child itemized deductions, enter the greater of:

Parents of children 18 and under or a student under age 24 at the end of

• $2,000, or

2014, may elect to include the child’s investment income on the parent’s

tax return. To make this election, the child must have had income only

• $1,000 plus the portion of the amount on Form 540 or Long

from interest and dividends. The election is not available if estimated tax

Form 540NR, line 18, that is directly connected with the production

payments were made in the child’s name. Get form FTB 3803, Parents’

of the investment income shown on form FTB 3800, line 1.

Election to Report Child’s Interest and Dividends, for more information.

Part II Tentative Tax Based on Parent’s Tax Rate

If parents make this election, the child will not have to file a California

tax return or form FTB 3800.

If the parent used Form 540 2EZ, refigure your tax by referring to the tax

If you elect to report your child’s income on your federal income tax

table for Form 540 in order to complete this part. Using Form 540 2EZ

return, but not on your California income tax return, be sure to make an

will not produce the correct result.

adjustment on your Schedule CA (540 or 540NR), line 21f.

Line 6 – Enter the taxable income from Form 540, line 19; or total

taxable income from Long or Short Form 540NR, line 19 of the parent

Specific Line Instructions

whose name is shown at the top of form FTB 3800. If the parent’s

taxable income is less than zero, enter -0- on line 6. If the parent filed a

Parent’s Name and Social Security Number (SSN) or Individual

Taxpayer Identification Number (ITIN)

joint California tax return, enter the taxable income shown on that return

even if the parent’s spouse/RDP is not the child’s parent.

If federal Form 8615, Tax for Certain Children Who Have Unearned

Income, was filed with the child’s federal tax return, enter the name and

Line 7 – If the individual identified as the parent on this form FTB 3800

SSN or ITIN of the same parent who was identified at the top of federal

is also identified as the parent on any other form FTB 3800, add the

Form 8615.

amounts, if any, from line 5 on each of the other forms FTB 3800 and

enter the total on line 7.

If the child’s parents were married to each other or in an RDP and filed

a joint 2014 California tax return, enter the name and SSN or ITIN of the

Line 9 – Use the California tax table or tax rate schedules in the 2014

parent who is listed first on the joint return.

instructions for Form 540 to find the tax for the amount on line 8, based

on the parent’s filing status.

If the parents were married or in an RDP but filed separate California tax

returns, enter the name and SSN or ITIN of the parent with the higher

taxable income.

FTB 3800 Instructions 2014 Page 1

Form 3800 - Tax Computation For Certain Children With Investment Income - 2014 Page 2

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