California has the highest state income tax in the nation — with rates from 1% to 13.3% across 9 tax brackets.
California Tax Rates 2026
Single Filers
| Taxable Income | Rate |
|---|---|
| $0 - $10,412 | 1% |
| $10,413 - $24,684 | 2% |
| $24,685 - $38,959 | 4% |
| $38,960 - $54,081 | 6% |
| $54,082 - $68,350 | 8% |
| $68,351 - $349,137 | 9.3% |
| $349,138 - $418,961 | 10.3% |
| $418,962 - $698,271 | 11.3% |
| $698,272 - $1,000,000 | 12.3% |
| $1,000,001+ | 13.3% |
Married Filing Jointly
| Taxable Income | Rate |
|---|---|
| $0 - $20,824 | 1% |
| $20,825 - $49,368 | 2% |
| $49,369 - $77,918 | 4% |
| $77,919 - $108,162 | 6% |
| $108,163 - $136,700 | 8% |
| $136,701 - $698,274 | 9.3% |
| $698,275 - $837,922 | 10.3% |
| $837,923 - $1,396,542 | 11.3% |
| $1,396,543 - $2,000,000 | 12.3% |
| $2,000,001+ | 13.3% |
How Much Will I Pay in California Tax?
| Taxable Income | Single Tax | Married Tax |
|---|---|---|
| $50,000 | $1,879 | $1,224 |
| $75,000 | $3,586 | $2,604 |
| $100,000 | $5,911 | $4,401 |
| $150,000 | $10,561 | $9,051 |
| $200,000 | $15,211 | $13,701 |
| $300,000 | $24,511 | $23,001 |
| $500,000 | $49,511 | $46,301 |
| $1,000,000 | $110,561 | $105,301 |
California Standard Deduction
| Filing Status | Standard Deduction |
|---|---|
| Single | $5,363 |
| Married Filing Jointly | $10,726 |
| Married Filing Separately | $5,363 |
| Head of Household | $10,726 |
California’s standard deduction is much smaller than the federal deduction.
California Exemption Credits
| Filing Status | Exemption Credit |
|---|---|
| Single | $144 |
| Married (each spouse) | $144 |
| Each dependent | $446 |
These are credits, not deductions — they directly reduce tax owed.
California Mental Health Tax (Prop 63)
Income over $1 million is also subject to an additional 1% Mental Health Services Tax, which is included in the 13.3% top rate (12.3% + 1%).
California Capital Gains Tax
California has no special capital gains rate. All capital gains are taxed as ordinary income:
| Income Level | Federal Long-Term Rate | California Rate |
|---|---|---|
| $50,000 | 0-15% | Up to 9.3% |
| $200,000 | 15% | Up to 9.3% |
| $1,000,000+ | 20% | 13.3% |
This makes California one of the most expensive states for high-income investors.
SDI/State Disability Insurance
| Tax | Rate | Wage Base |
|---|---|---|
| SDI | 1.1% | $153,164 |
| Maximum annual SDI | $1,684.80 | — |
SDI is automatically withheld from wages.
California vs. Other High-Tax States
| State | Top Rate | Applies At |
|---|---|---|
| California | 13.3% | $1,000,000+ |
| New Jersey | 10.75% | $1,000,000+ |
| New York | 10.9% | $25,000,000+ |
| Oregon | 9.9% | $125,000+ |
| Minnesota | 9.85% | $183,340+ |
California has both the highest rate and the steepest progression.
Who Must File a California Tax Return?
You must file if:
- Single/Married Filing Separately: Gross income > $21,731 (or adjusted gross income > $17,404)
- Married Filing Jointly: Gross income > $43,463 (or AGI > $34,807)
- Head of Household: Gross income > $30,449 (or AGI > $24,358)
Thresholds include standard deduction and exemption credits.
California Tax Deductions
Itemized Deductions Allowed
- Mortgage interest (with limits)
- Property taxes (state-specific limit)
- Charitable contributions
- Medical expenses (above 7.5% AGI)
- Casualty losses
Deductions NOT Allowed
- State/local income taxes paid (SALT)
- Investment interest expenses (limited)
Note: California does not allow the $10,000 SALT deduction that exists federally.
California Tax Credits
| Credit | Amount |
|---|---|
| Child & Dependent Care | Up to 50% of federal credit |
| Renter’s Credit | $60 (single) / $120 (married) |
| Senior Head of Household | $1,565 |
| Joint Custody Head of Household | 30% of tax liability |
| California Earned Income Tax Credit | Up to $3,529 |
CalEITC (California Earned Income Tax Credit)
| Filing Status | Max Credit | Income Limit |
|---|---|---|
| No children | $275 | $30,950 |
| 1 child | $1,983 | $30,950 |
| 2 children | $3,275 | $30,950 |
| 3+ children | $3,529 | $30,950 |
Plus Young Child Tax Credit of up to $1,117 for qualifying families.
How to File California Taxes
| Method | Cost | Best For |
|---|---|---|
| CalFile (free) | $0 | Simple returns |
| FTB Free File | $0 | Income < $79,000 |
| Commercial software | $0-$100 | Complex returns |
| Tax professional | $150-$500+ | Business owners |
Filing deadline: April 15 (same as federal)
California Tax Strategies
1. Maximize Retirement Contributions
California taxes all ordinary income, so 401(k) and IRA contributions reduce your tax burden.
2. Consider Municipal Bonds
California municipal bonds are triple tax-free (federal, state, and AMT).
3. Charitable Giving
Charitable contributions are fully deductible on California returns.
4. Timing Capital Gains
If leaving California, realizing gains before establishing residency elsewhere can be costly.
5. Relocate (For High Earners)
Some high earners move to states like Texas, Florida, or Nevada to avoid the 13.3% top rate.
California Part-Year and Nonresident Rules
| Status | What’s Taxed |
|---|---|
| Full-year resident | All worldwide income |
| Part-year resident | Income while CA resident + CA source income |
| Nonresident | Only CA source income |
California aggressively pursues “residency audits” for high earners who claim to have moved.
California Tax Penalties
| Violation | Penalty |
|---|---|
| Late filing | 5% per month up to 25% |
| Late payment | 0.5% per month plus interest |
| Underpayment | Interest + possible penalty |
| Fraud | 75% of underpaid tax |
Bottom Line
California has the highest state income tax in the nation at 13.3% for income over $1 million. Most residents pay between 6-9.3% on their income. The state also taxes capital gains as ordinary income. California’s standard deduction is small ($5,363 single), making itemization more common. For high earners, California taxes can add 10-13% to their overall tax burden — a significant consideration for financial planning.