The California 3800 form is a tax document used to compute the tax for certain children who have investment income. Specifically, it applies to children under 19 or students under 24 with investment income exceeding $1,900, allowing their income to be taxed at their parent's tax rate. Completing this form is essential for accurate tax reporting, so be sure to fill it out by clicking the button below.
The California Form 3800, known as the Tax Computation for Certain Children with Investment Income, plays a crucial role for families with children under 19 or students under 24 who have investment income exceeding $1,900. This form is attached to the child's Form 540 or Long Form 540NR and helps determine the tax liability based on the child's investment earnings. It requires basic information such as the child's name and Social Security Number (SSN), along with the parent's details and filing status. The form is divided into several parts, where parents will input the child’s net investment income, calculate tentative taxes based on the parent’s tax rate, and ultimately determine the child's tax. If the investment income is below the threshold, families can stop there. However, if it exceeds $1,900, the form guides parents through a series of calculations to ensure compliance with California tax laws. Understanding this form is essential for accurately reporting and minimizing tax obligations for families in this situation.
TAXABLE YEAR
Tax Computation for Certain Children
CALIFORNIA FORM
2011
with Investment Income
3800
Attach ONLY to the child’s Form 540 or Long Form 540NR
Child’s name as shown on return
Child’s SSN or ITIN
-
Parent’s name (first, initial, and last). (Caution: See instructions before completing.)
Parent’s SSN or ITIN
Parent’s filing status (check one):
Single Married/RDP filing jointly Married/RDP filing separately Head of household Qualifying widow(er)
Enter number of exemptions claimed on parent’s return. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part I Child’s net investment income
1Enter the child’s investment income, such as taxable interest, ordinary dividends, and capital gains.
See instructions. If this amount is $1,900 or less, stop here; do not file this form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2If the child did not itemize deductions on Form 540 or Long Form 540NR, enter $1,900. If the child itemized
deductions, see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3Subtract line 2 from line 1. If zero or less, stop here; do not complete the rest of this form but attach
it to the child’s return . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
00
4 Enter the child’s taxable income from Form 540, line 19 or total taxable income from Long Form 540NR, line 19 . . . . . . 4
5 Net investment income. Enter the smaller of line 3 or line 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Part II Tentative tax based on the tax rate of the parent listed above
6Enter the parent’s taxable income from Forms 540/540A, line 19; or total taxable income
from Long or Short Form 540NR, line 19. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7Enter the total net investment income, if any, from form(s) FTB 3800, line 5, of all other children of the
parent identified above. Do not include the amount from line 5 above. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
8 Add line 5 through line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
9Enter the tax on the amount on line 8 based on the parent’s filing status. Use the tax table or tax rate schedules
found in the 2011 instructions for Forms 540/540A. See instructions for Long or Short Form 540NR filers . . . . . . . . . . . 9
10Enter the parent’s tax from Forms 540/540A, line 31. See instructions for Long or Short Form 540NR filers.
Do not include any tax from FTB 3803 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
11Subtract line 10 from line 9. If you did not enter an amount on line 7, then enter the amount from
line 11 on line 13 and skip line 12a and line 12b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
12 a
Add line 5 and line 7
12a
b
Divide line 5 by line 12a. Enter the result as a decimal (rounded to four places)
. . . . . .12b X . ____ ____ ____ ____
13 Multiply line 11 by the decimal amount on line 12b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Part III Child’s tax
If the amounts on line 4 and line 5 above are the same, enter -0- on line 15 and go to line 16.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Subtract line 5 from line 4
14
15Enter the tax on the amount on line 14 based on the child’s filing status. Use the tax table or tax rate schedules
found in the 2011 instructions for Form 540. See instructions for Long Form 540NR filers . . . . . . . . . . . . . . . . . . . . . . . . 15
16 Add line 13 and line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
17Enter the tax on the amount on line 4 based on the child’s filing status. Use the tax table or tax rate schedules
found in the 2011 instructions for Form 540. See instructions for Long Form 540NR filers . . . . . . . . . . . . . . . . . . . . . . . . 17
18Compare the amounts on line 16 and line 17. Enter the larger of the two amounts here and on the child’s Form 540, line 31. Also fill in the circle labeled “FTB 3800’’ on the child’s tax return.
See instructions for Long Form 540NR filers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
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FTB 3800 2011
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
For taxable years beginning on or after January 1, 2010, California conforms to the provision of the Small Business and Work Opportunity Act of 2007 which increased the age of children to 18 and under or
a student under age 24 for elections made by parents reporting their child’s interest and dividends.
Registered Domestic Partners (RDP) – For purposes of California income tax, references to a spouse, husband, or wife also refer to a California RDP, unless otherwise specified. When we use the initials RDP they refer to both a California registered domestic “partner” and a California registered domestic “partnership,” as applicable. For more information on RDPs, get FTB Pub. 737, Tax Information for Registered Domestic Partners.
Purpose
For certain children, investment income over $1,900 is taxed at the parent’s rate if the parent’s rate is higher. Use form FTB 3800, Tax Computation for Certain Children with Investment Income, to figure the child’s tax.
Complete form FTB 3800 if all of the following apply:
•The child is 18 and under or a student under age 24 at the end of 2011. A child born on January 1, 1994, is considered to be age 18 at the end of 2011. A child born on January 1, 1988, is considered to be age 24 at the end of 2011.
•The child had investment income taxable by California of more than $1,900.
•At least one of the child’s parents was alive at the end of 2011.
If the child uses form FTB 3800, file Form 540, California Resident Income Tax Return, or Long Form 540NR, California Nonresident or Part-Year Resident Income Tax Return.
If the child does not file form FTB 3800, figure the tax in the normal manner on the child’s Forms 540/540A, or Long or Short Form 540NR.
Parents of children 18 and under or a student under age 24 at the end of 2011, 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 from interest and dividends. The election is not available if estimated tax payments were made in the child’s name. Get form FTB 3803, Parents’ Election to Report Child’s Interest and Dividends, for more information. If parents make this election, the child will not have to file a California tax return or form FTB 3800.
If you elect to report your child’s income on your federal income tax return, but not on your California income tax return, be sure to make an adjustment on your Schedule CA (540 or 540NR), line 21f.
Specific Line Instructions
Parent’s Name and Social Security Number (SSN) or Individual Taxpayer Identiication Number (ITIN)
If federal Form 8615, Tax for Certain Children Who Have Investment Income of More Than $1,900, was filed with the child’s federal tax return, enter the name and SSN or ITIN of the same parent who was identified at the top of federal Form 8615.
If the child’s parents were married to each other or in an RDP and filed a joint 2011 California tax return, enter the name and SSN or ITIN of the parent who is listed first on the joint return.
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.
If the parents were unmarried, treated as unmarried for tax purposes, or separated either by a divorce or separate maintenance decree, enter the name and SSN or ITIN of the parent who had custody of the child for most of 2011.
Exception. If the custodial parent remarried or entered into an RDP and filed a joint return with the new spouse/RDP, enter the name and SSN or ITIN of the person listed first on the joint return, even if that person is not the child’s parent. If the custodial parent and the new spouse/RDP filed separate California tax returns, enter the name and SSN or ITIN of the person with the higher taxable income, even if that person is not the child’s parent.
If the child’s parents were unmarried but lived together during the year with the child, enter the name and SSN or ITIN of the parent who had the higher taxable income.
Part I Child’s Net Investment Income
Line 1 – Enter the child’s investment income. Include income such as taxable interest, dividends, capital gains, rents, annuities, and income received as a beneficiary. In most cases, this will be the same as the amount entered on federal Form 8615, include only income taxable by California. Also, include investment income that was not taxed on the child’s federal tax return but is taxable under California law. For more information, get the instructions for Schedule CA (540 or 540NR), line 8 and line 9.
If the child had earned income (defined below), use the following worksheet to figure the amount to enter on form FTB 3800, line 1.
1.Enter the amount of the child’s adjusted gross income from Form 540, line 17 or
Long Form 540NR, line 17, whichever applies . . . . . . 1 __________
2.Enter the child’s earned income . . . . . . . . . . . . . . . . . . 2 __________
(wages, tips, and other payments received for personal services performed)
3.Subtract line 2 from line 1. Enter the result
here and on form FTB 3800, line 1 . . . . . . . . . . . . . . . 3 __________
Line 2 – If the child itemized deductions, enter the greater of:
$950 plus the portion of the amount on Form 540 or Long Form 540NR, line 18, that is directly connected with the production of the investment income shown on form FTB 3800, line 1 or $1,900.
Part II Tentative Tax Based on Parent’s Tax Rate
If the parent used Form 540 2EZ, refigure your tax by referring to the tax table for Forms 540/540A in order to complete this part. Using Form 540 2EZ will not produce the correct result.
Line 6 – Enter the taxable income from Forms 540/540A, line 19; or total taxable income from Long or Short Form 540NR, line 19 of the parent 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 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.
Line 7 – If the individual identified as the parent on this form FTB 3800 is also identified as the parent on any other form FTB 3800, add the amounts, if any, from line 5 on each of the other forms FTB 3800 and enter the total on line 7.
Line 9 – Use the California tax table or tax rate schedules in the 2011 instructions for Forms 540/540A to find the tax for the amount on line 8, based on the parent’s filing status.
FTB 3800 2011 Page 1
Long or Short Form 540NR Filers: To figure a revised California adjusted gross income and a tentative tax based on the parent’s tax rate, complete the following worksheet.
AEnter the child’s portion of the net investment income that must be included in the child’s
CA adjusted gross income
____________
B
Enter parent’s CA adjusted gross income from
Long or Short Form 540NR, Line 32
C
Add line A and line B
D
Enter the child’s investment income
(form FTB 3800, line 5)
E
Enter parent’s adjusted gross income from all
sources from Long or Short Form 540NR, line 17. . .
If the parents have other children for whom form
FTB 3800 was completed, add the other children’s
net investment income to the parent’s CA adjusted
gross income on line B and to the parent’s adjusted
gross income from all sources on line E.
F
Add line D and line E
G
Divide line C by line F (not to exceed 1.0)
HEnter the parent’s total itemized deductions or standard deduction from Long or Short
Form 540NR, line 18
I
Multiply line H by line G
J
Subtract line I from line C
K
Subtract line H from line F
LFind the tax on the amount on line K for the parent’s filing status (Use the tax table or tax rate schedules in the 2011 instructions for
Long or Short Form 540NR)
M
Divide line L by line K
N
Multiply line J by line M. Enter the result on form
FTB 3800, line 9
Line 10 – Enter the tax shown on the tax return of the parent identified at the top of form FTB 3800 from Forms 540/540A, line 31.
If the parent filed a joint tax return, enter on line 10 the tax shown on that tax return even if the parent’s spouse/RDP is not the child’s parent.
Long Form 540NR Filers: If the parent’s tax amount on Long
Form 540NR, line 37 does not include an amount from form FTB 3803, then enter the parent’s tax amount from Long Form 540NR, line 37.
If the parent’s tax amount on Long Form 540NR, line 37 includes an amount from form FTB 3803, revise the parent’s tax by completing the following worksheet.
A
Enter the tax from the parent’s
Long Form 540NR, line 31
Enter the tax from form FTB 3803
Subtract line B from line A
Enter the amount from the parent’s
Long Form 540NR, line 19
Divide line C by line D
Long Form 540NR, line 35
Multiply line F by line E. Enter the result
on form FTB 3800, line 10
Part III Child’s Tax
Line 15 – Use the California tax table or tax rate schedules in the 2011 instructions for Form 540 to find the tax for the amount on line 14 based on the child’s filing status.
Long Form 540NR Filers: To figure a revised California adjusted gross income for the child and the child’s tax, complete the following worksheet.
A Enter the child’s CA adjusted gross income
from Long Form 540NR, line 32
BEnter the portion of the child’s net investment income that must be included in the child’s
Enter the child’s adjusted gross income from all
sources from Long Form 540NR, line 17
Subtract line E from line D
HEnter the child’s total itemized deductions or standard deduction from Long or Short
LFind the tax on the amount on line K for the child’s filing status (Use the tax table or tax rate schedules in the 2011 instructions for
Long Form 540NR)
Multiply line J by line M. Enter the result on
form FTB 3800, line 15
Line 17 – Use the California tax table or tax rate schedules found in the 2011 instructions for Form 540 to find the tax for the amount on line 4, based on the child’s filing status.
Long Form 540NR Filers:
A Enter the amount from form FTB 3800, line 4
BFind the tax for the amount on line A, by using the tax table or tax rate schedules in the 2011 instructions for Long Form 540NR based on
the child’s filing status
Divide line B by line A
Enter the amount from the child’s
Multiply line D by line C. Enter the result on
form FTB 3800, line 17
Line 18 – Compare the amounts on line 16 and line 17 and enter the larger of the two amounts on line 18. Be sure to fill in the circle labeled “FTB 3800” on Form 540, line 31 of the child’s tax return.
Long Form 540NR Filers: Divide the child’s Long Form 540NR, line 35 by the child’s Long Form 540NR, line 19 to determine the child’s percentage. Divide the larger of line 16 or line 17, by the percentage. Enter the amount on line 18 and on the child’s Long Form 540NR, line 31. Be sure to the fill in the circle labeled “FTB 3800” on the child’s Long Form 540NR.
Note: The amount entered on 540NR, line 31 reflects your tax on total taxable income before applying the California tax rate to your California source income. Follow the instructions for Long Form 540NR to determine your final California tax.
Page 2 FTB 3800 2011
Completing the California 3800 form requires careful attention to detail. This form is used to report the tax computation for certain children with investment income. Follow these steps to ensure accurate completion of the form.
Proceed to Part I to calculate the child’s net investment income. If the child’s investment income is $1,900 or less, you can stop here and do not need to file this form.
Next, move to Part II to determine the tentative tax based on the parent’s tax rate.
Finally, proceed to Part III to calculate the child’s tax.
The California Form 3800, also known as the Tax Computation for Certain Children with Investment Income, is used to calculate the tax for children who have investment income exceeding $1,900. If the child meets specific criteria, their investment income may be taxed at the parent's tax rate instead of the child's rate. This form is essential for ensuring that families comply with California tax laws regarding children's investment income.
Form 3800 must be filed if the following conditions are met:
If these conditions are satisfied, the child’s investment income must be reported using this form.
To determine whether your child's investment income exceeds $1,900, you will need to sum all sources of investment income. This includes:
If the total of these amounts is more than $1,900, you will need to complete Form 3800.
If the child’s investment income is $1,900 or less, you do not need to file Form 3800. Simply report the income on the child’s Form 540 or Long Form 540NR as usual. No additional tax computation is necessary in this case.
Yes, parents can elect to report their child’s investment income on their own tax return if the child meets certain criteria. The child must have earned only interest and dividends, and no estimated tax payments can have been made in the child’s name. If this election is made, the child will not need to file Form 3800 or a California tax return.
When completing Form 3800, you will need to provide:
This information is crucial for calculating the tax based on the parent’s tax rate.
Additional instructions for completing Form 3800 can be found in the 2011 instructions for Forms 540/540A or Long or Short Form 540NR. These instructions provide detailed guidance on how to fill out the form correctly, including specific line instructions and tax rate tables.
Incorrect Parent Information: Failing to provide the correct name and Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) of the parent can lead to complications. Ensure that the information matches the parent’s tax return.
Misreporting Investment Income: Entering the wrong amount for the child’s investment income can affect the tax calculation. It is important to include only income that is taxable by California, such as interest and dividends, and to verify the figures against federal forms.
Neglecting to Stop at $1,900: If the child’s investment income is $1,900 or less, individuals should not file this form. Some may mistakenly proceed with the form despite being under this threshold.
Incorrect Taxable Income Reporting: When entering the parent’s taxable income, ensure it is from the correct lines on Forms 540/540A or Long Form 540NR. Errors here can lead to incorrect tax calculations.
Omitting Other Children’s Income: If there are other children, failing to include their net investment income on the appropriate lines can result in an inaccurate tax calculation for the parent. This step is crucial for determining the correct tax rate.
Ignoring Filing Status: The parent’s filing status must be correctly indicated. This status affects tax calculations, and using the wrong status can lead to discrepancies in the tax owed.
The California 3800 form is essential for calculating the tax liability of certain children with investment income. It is often used in conjunction with various other forms and documents that assist in accurately reporting income and determining tax obligations. Below is a list of related forms and documents that may be required in conjunction with the California 3800 form.
Understanding these related forms and documents can help ensure compliance with California tax laws and optimize tax benefits for families. Properly utilizing the California 3800 form alongside these additional documents can lead to more accurate tax reporting and potential savings.
The California Form 8615, also known as the Tax for Certain Children Who Have Investment Income of More Than $1,900, is similar to the California 3800 form in that it addresses the taxation of a child's investment income. Both forms are used when a child has investment income exceeding $1,900, and the tax is calculated based on the parent's tax rate. The primary difference lies in the filing process, as Form 8615 is used at the federal level, while Form 3800 is specific to California. Both forms require information about the child's income and the parent's tax situation to determine the appropriate tax liability.
The IRS Form 8814, known as the Parent's Election to Report Child's Interest and Dividends, is another document that shares similarities with the California 3800 form. This federal form allows parents to report their child's interest and dividend income on their tax return instead of the child filing separately. If the child’s investment income is below a certain threshold, parents can choose this option. Like the 3800 form, it simplifies the tax process for families with children who have investment income, but it is applicable at the federal level, contrasting with the California-specific nature of the 3800 form.
The California Form 540 is the standard individual income tax return for California residents. It is similar to the California 3800 form because both are used to report income and calculate tax liabilities for individuals, including children with investment income. While Form 540 covers a broader range of income types and tax situations, the 3800 form specifically addresses the taxation of investment income for children under certain conditions. Both forms require detailed information about income and deductions to ensure accurate tax calculations.
The IRS Form 1040 is the primary federal income tax return form for individuals in the United States. It shares similarities with the California 3800 form in that both are used to report income and calculate tax liabilities. While the 1040 form encompasses all income types, including wages and salaries, the 3800 form focuses solely on the investment income of children. Both forms require careful completion to ensure compliance with tax laws and accurate reporting of income.
The California Form 540NR, the Nonresident or Part-Year Resident Income Tax Return, is also comparable to the California 3800 form. It is used by individuals who do not reside in California for the entire year or who are part-year residents. Like the 3800 form, it addresses income and tax calculations specific to California tax laws. The 540NR form is broader in scope, while the 3800 form specifically targets the investment income of children, but both require similar information regarding income sources and tax calculations.
Lastly, the California Schedule CA (540) is used to make adjustments to federal adjusted gross income for California tax purposes. This form is similar to the California 3800 form in that both require detailed income reporting and adjustments based on California tax laws. While Schedule CA is used to reconcile federal and state tax figures, the 3800 form specifically calculates tax for children with investment income. Both documents are essential for ensuring accurate tax reporting in compliance with California tax regulations.
When filling out the California 3800 form, keep the following tips in mind:
Misconception 1: The California 3800 form is only for children under 18.
This is incorrect. The form applies to children who are 18 and under or students under age 24 at the end of the taxable year.
Misconception 2: Parents must file the California 3800 form every year.
Not necessarily. The form is only required if the child has investment income exceeding $1,900. If the income is below this threshold, the form is not needed.
Misconception 3: Investment income includes all types of income.
Only specific types of income, such as taxable interest, ordinary dividends, and capital gains, are considered investment income for this form.
Misconception 4: Completing the 3800 form guarantees a tax refund.
Filing this form does not guarantee a refund. It merely calculates the tax owed on the child's investment income, which may result in additional taxes due.
Misconception 5: The 3800 form is the same as the federal form 8615.
While both forms deal with the taxation of children's investment income, they are separate and have different requirements and calculations.
Misconception 6: All parents can elect to report their child's investment income on their tax return.
This option is only available if the child’s income comes solely from interest and dividends. If the child made estimated tax payments or has other types of income, this election cannot be made.
When filling out the California 3800 form, there are several important points to keep in mind: