The California 3803 form is a tax document that allows parents to report their child's interest and dividend income on their own California income tax return. This form is particularly useful for parents of children under 19 or full-time students under 24, enabling them to simplify the tax filing process for their children. To learn more about how to complete this form, click the button below.
The California Form 3803, also known as the Parents’ Election to Report Child’s Interest and Dividends, serves a crucial role for parents who wish to report their child's investment income on their own state tax return. This form allows parents to include their child's interest and dividend income, simplifying the tax filing process for families. To qualify for this election, the child must be under 19 years old or under 24 and a full-time student, with income derived solely from interest and dividends. The form requires parents to provide specific details about the child’s income, including taxable interest, tax-exempt interest, ordinary dividends, and capital gain distributions. If the total income is $1,900 or less, parents can report it without needing the child to file a separate return. However, if the income exceeds $9,500, the child must file their own tax return. Additionally, the form outlines the necessary calculations for determining any applicable tax on the child’s income. By completing and attaching Form 3803 to their California income tax return, parents can streamline their tax obligations while ensuring compliance with state tax laws.
TAXABLE YEAR
Parents’ Election to Report
CALIFORNIA FORM
2012
Child’s Interest and Dividends
3803
Attach to Parents’ Form 540 or Long Form 540NR
Name(s) as shown on return
Child’s name (first, initial, and last)
Your SSN or ITIN
- -
Child’s SSN or ITIN
If more than one form FTB 3803 is attached, check here . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part I — Child’s interest and dividend income to report on your return (the child must be under age 19 or under age 24 and a full time student, see instructions).
1 a Enter your child’s taxable interest income
1a
|00
bEnter your child’s tax-exempt interest income. Do not include this amount
on line 1a
1b
2Enter your child’s ordinary dividends. If none, enter -0-. If your child received any dividends as a nominee,
see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
3Enter your child’s capital gain distributions. If your child received any capital gain distributions as a nominee,
see instructions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
4Add line 1a, line 2, and line 3. If the total is $1,900 or less, skip line 5 and line 6 and go to line 7.
If the total is $9,500 or more, do not file this form. Your child must file his or her own return to report the income. . . . . . .4
5 Base amount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
6 Subtract line 5 from line 4. See instructions for where to report this amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
Go to line 7 below
$1,900 |00 |00
Part II — Tax on the first $1,900 of child’s interest and dividend income.
7
Amount not taxed
$ 950 |00
8
Subtract line 7 from line 4. If zero or less, enter -0-
9
Tax. Is the amount on line 8 less than $950?
No.
Enter $10.00 here and see the Note below.
Yes.
Multiply line 8 by 1% (.01). Enter the result here and see the Note below
Note: Add the amount of tax from each form FTB 3803, line 9 to any tax you enter on Form 540 or Long Form 540NR, line 31 and check the box labeled “FTB 3803.”
Instructions for Form FTB 3803
Parents’ Election to Report Child’s Interest and Dividends
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
In general, for taxable years beginning on or after January 1, 2010, California law conforms to the Internal Revenue Code (IRC) as of January 1, 2009. However, there are continuing differences between California 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 information, go to ftb.ca.gov and search for conformity. Additional information can be found in FTB Pub. 1001, Supplemental Guidelines to California Adjustments, the instructions for California Schedule CA (540 or 540NR), and the Business Entity tax booklets.
The instructions provided with California tax forms are a summary of California tax law and are only intended to aid taxpayers in preparing their state income tax returns. We include information that is most useful to the greatest number of taxpayers in the limited space available. It is not possible to include all requirements of the California Revenue and Taxation Code (R&TC) in the tax booklets. Taxpayers should not consider the tax booklets as authoritative law.
For taxable years beginning on or after January 1, 2010, California conforms to the provision of the Small Business and Work Opportunity Tax Act of 2007 which increased the age of children to under age 19 or a student under age 24 for elections made by parents reporting their child’s interest and dividends.
For Privacy Notice, get form FTB 1131.
7481123
FTB 3803 2012
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.
A Purpose
Parents may elect to report their child’s income on their California income tax return by completing form FTB 3803, Parents’ Election to Report Child’s Interest and Dividends. If you make this election, the child will not have to file a return. You may report your child’s income on your California income tax return even if you do not do so on your federal income tax return. You may make this election if your child meets all of the following conditions:
•Was under age 19 or a student under age 24 at the end of 2012. A child born on January 1, 1994, is considered to be age 19 at the end of 2012. A child born on January 1, 1989, is considered to be age 24 at the end of 2012.
•Is required to file a 2012 income tax return.
•Had income only from interest and dividends.
•Had gross income for 2012 that was less than $9,500.
•Made no estimated tax payments for 2012.
•Did not have any overpayment of tax shown on his or her 2011 return applied to the 2012 estimated taxes.
•Had no state income tax withheld from his or her income (backup withholding).
As a parent, you must also qualify as explained in Section B.
B Parents Who Qualify to Make the Election
You qualify to make this election if you file Form 540, California Resident Income Tax Return, or Long Form 540NR, California Nonresident or Part- Year Resident Income Tax Return, and if any of the following applies to you:
•You and the child’s other parent were married to each other or in a registered domestic partnership and you file a joint return for 2012.
•You and the child’s other parent were married to each other or in a registered domestic partnership but you file separate returns for 2012 AND you had the higher taxable income. If you do not know if you had the higher taxable income, get federal Publication 929, Tax Rules for Children and Dependents.
•You were unmarried, treated as unmarried for state income tax purposes, or separated from the child’s other parent by a divorce, separate maintenance decree, or termination of a domestic partnership and you had custody of your child for most of the year (you were the custodial parent). If you were the custodial parent and you remarried or entered into another registered domestic partnership, you may make the election on a joint return with your new spouse/RDP (your child’s stepparent). But if you and your new spouse/RDP do not file a joint return, you qualify to make the election only if you had higher taxable income than your new spouse/RDP.
If you and the child’s other parent were not married or in a registered domestic partnership but you lived together during the year with the child, you qualify to make the election only if you are the parent with the higher taxable income.
If you elect to report your child’s income on your return, you may not reduce that income by any deductions that your child would be entitled to claim on his or her own return, such as the penalty on early withdrawal of child’s savings or any itemized deductions. For more information, get the instructions for federal Form 8814, Parents’ Election to Report Child’s Interest and Dividends.
C How to Make the Election
To make the election, complete and attach form FTB 3803 to your Form 540 or Long Form 540NR and file your return by the due date (including extensions).
File a separate form FTB 3803 for each child whose income you choose to report.
Specific Line Instructions
Use Part I to figure the amount of the child’s income to report on your return. Use Part II to figure any additional tax that must be added to your tax.
Name and Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN). Enter your name as shown on your tax return. If filing a joint return, include your spouse’s/RDP’s name but enter the SSN or ITIN of the person whose name is shown first on the return.
For more information about interest, dividends, and capital gain distributions taxable by California, get the instructions for Schedule CA (540), California Adjustments — Residents, or Schedule CA (540NR), California Adjustments — Nonresidents or Part-Year Residents.
Part I Child’s Interest and Dividend Income to Report on Your Return
Line 1a
Enter all interest income taxable by California and received by your child in 2012. If, as a nominee, your child received interest that actually belongs to another person, write the amount and the initials “ND” (for “nominee distribution”) on the dotted line to the left of line 1a. Do not include amounts received by your child as a nominee in the total entered on line 1a.
If your child received Form 1099-INT, Interest Income, showing California tax-exempt interest or Form 1099-OID, Original Issue Discount, get the instructions for federal Form 8814.
Line 1b
If your child received any interest income exempt from California tax, such as interest on United States savings bonds or California municipal bonds, enter the total tax-exempt interest on line 1b. Also include any exempt- interest dividends your child received as a shareholder in a mutual fund or other regulated investment company. Do not include this interest on line 1a. Get the instructions for Schedule CA (540 or 540NR), line 8, for more information.
Line 2
Enter ordinary dividends received by your child in 2012. Ordinary dividends should be shown on Form 1099-DIV, Dividends and Distributions, box 1. Also, include ordinary dividends your child received through a partnership, an S corporation, an estate, or trust.
If your child received, as a nominee, ordinary dividends that actually belong to another person, enter the amount and the initials “ND” on the dotted line to the left of line 2. Do not include amounts received as a nominee in the total for line 2.
Line 3
Enter the capital gain distributions taxable by California and received by your child in 2012. Capital gain distributions should be shown on Form 1099-DIV, box 2a. Also, see the instructions for line 6. If your child received, as a nominee, capital gain distributions that actually belong to another person, enter the amount and the initials “ND” on the dotted line to the left of line 3. Do not include amounts received as a nominee in the total for line 3.
Line 6
If the total amount on line 6 of all form(s) FTB 3803 is less than the total amount on line 6 of all your federal Form(s) 8814, enter the difference on Schedule CA (540 or 540NR), line 21f, column B and write “FTB 3803” on line 21f.
If the total amount on line 6 of all form(s) FTB 3803 is more than the total amount on line 6 of all your federal Form(s) 8814, enter the difference on Schedule CA (540 or 540NR), line 21f, column C and write “FTB 3803” on line 21f.
If you did not file federal Form 8814, enter the amount from form
FTB 3803, line 6, on Schedule CA (540 or 540NR), line 21f, column C and write “FTB 3803” on line 21f.
If your child received capital gain distributions (shown on Form 1099-DIV, box 2a and box 2b) and you have other gains or losses to report on your Schedule D, California Capital Gain or Loss Adjustment, you must report part or all of your child’s capital gain distributions on your Schedule D instead of on form FTB 3803, line 6. Get federal Publication 929 for more information on how to figure the amount to report on your Schedule D.
Part II Tax on the First $1,900 of Child’s Interest and Dividend Income
Line 9
Add the amount of tax from each form FTB 3803, line 9 to any tax you enter on Form 540 or Long Form 540NR, line 31 and check the box labeled “FTB 3803.”
Page 2 FTB 3803 2012
Filling out the California 3803 form is a straightforward process that allows parents to report their child's interest and dividend income on their tax return. After completing this form, you will attach it to your Form 540 or Long Form 540NR when filing your taxes. This ensures that your child's income is accounted for without requiring them to file a separate return, provided they meet certain criteria.
California Form 3803, also known as the Parents’ Election to Report Child’s Interest and Dividends, allows parents to report their child's interest and dividend income on their own tax return. This election can simplify the tax filing process for families, as it enables the child to avoid filing a separate return if certain conditions are met.
To qualify for using Form 3803, the child must meet specific criteria:
Additionally, the parent filing the form must also meet certain qualifications, such as filing a joint return with the child's other parent or having a higher taxable income if filing separately.
To complete Form 3803, follow these steps:
If your child's total income exceeds $9,500, they must file their own tax return. In this case, Form 3803 cannot be used, and the child will be responsible for reporting their income independently. It is important to monitor the income levels to ensure compliance with tax regulations.
Yes, you can elect to report your child's income on your California tax return using Form 3803, regardless of how you report it on your federal return. This means that even if you do not report your child’s income federally, you can still make this election for California state taxes, provided all eligibility criteria are met.
Incorrect Personal Information: One of the most common mistakes is entering incorrect names or Social Security Numbers (SSNs) for both the parents and the child. It is essential to ensure that all names match exactly as they appear on the tax returns to avoid delays or rejections.
Failure to Check Eligibility: Many parents overlook the eligibility requirements for filing Form 3803. The child must be under 19 or under 24 and a full-time student. If these conditions are not met, the election cannot be made, and the form should not be submitted.
Omitting Income Sources: Parents sometimes fail to include all sources of the child’s income. It is crucial to report all taxable interest, tax-exempt interest, ordinary dividends, and capital gain distributions accurately. Missing any of these can lead to incorrect tax calculations.
Incorrect Calculation of Tax: Errors in calculating the tax on the child’s income can occur, especially when determining the tax on the first $1,900 of interest and dividends. Parents must carefully follow the instructions to ensure that the correct tax amount is reported.
Not Filing on Time: Lastly, parents often forget to file the form by the due date. It is essential to attach Form 3803 to the main tax return and submit it on time to avoid penalties and interest on unpaid taxes.
The California Form 3803 is a crucial document for parents who wish to report their child's interest and dividends on their own tax returns. This form simplifies the process for families, allowing them to include their child's income without requiring the child to file a separate return. However, several other forms and documents are often used in conjunction with Form 3803 to ensure compliance with tax regulations and proper reporting. Below is a list of related documents that may be necessary.
In summary, while Form 3803 plays a pivotal role in reporting a child's interest and dividends on a parent's tax return, it is often accompanied by several other forms and schedules. These documents collectively ensure accurate reporting and compliance with both California and federal tax laws. Understanding the purpose of each form can help parents navigate the complexities of tax filing with greater ease.
The California Form 8814, Parents’ Election to Report Child’s Interest and Dividends, is similar to Form 3803 in that it allows parents to report their child's interest and dividend income on their own tax return. Both forms cater to children under 19 or under 24 who are full-time students, enabling parents to consolidate tax filings. While Form 8814 is used at the federal level, Form 3803 serves the same purpose for California state taxes. This can simplify the tax process for families, as it avoids the need for the child to file a separate return if the income is below certain thresholds.
The IRS Form 1040 is another document that shares similarities with Form 3803. The 1040 is the standard individual income tax return used by U.S. taxpayers to report their income, claim deductions, and determine their tax liability. Just like Form 3803, the 1040 allows for the reporting of various income types, including interest and dividends. However, while Form 3803 focuses specifically on children’s income and the parents’ election to report it, the 1040 encompasses a broader range of income sources and deductions applicable to all taxpayers.
Form 540, California Resident Income Tax Return, is integral to the California tax system and is closely related to Form 3803. Parents must attach Form 3803 to their Form 540 when they choose to report their child's income. Both forms work together to ensure that the child's income is accurately reported within the family’s overall tax situation. Form 540 serves as the primary return for California residents, while Form 3803 specifically addresses the nuances of reporting a child's income.
Form 540NR, California Nonresident or Part-Year Resident Income Tax Return, is another relevant document. This form is similar to Form 540 but is designed for individuals who do not reside in California for the entire year. Like Form 3803, it allows for the reporting of income, including that of children, under specific circumstances. Families with children who earn income while living temporarily in California can use Form 540NR alongside Form 3803 to ensure compliance with state tax regulations.
Form 1099-INT, Interest Income, is a document that reports interest income earned by individuals, including children. It is similar to Form 3803 in that both deal with interest income, but Form 1099-INT is specifically used to report the income received, while Form 3803 is used to elect how that income will be reported on the parents’ tax return. Parents may receive this form for their child’s interest income and then use that information to complete Form 3803.
Form 1099-DIV, Dividends and Distributions, is another form that aligns with Form 3803. This form reports dividends received, including those received by children. Just like Form 3803, it highlights the importance of accurately reporting dividend income for tax purposes. Parents can use the information from Form 1099-DIV to determine the amount to report on Form 3803, ensuring that all income is accounted for correctly.
Schedule CA (540), California Adjustments, is closely related to Form 3803 as it is used to make adjustments to income reported on the California tax return. Parents who elect to report their child’s income using Form 3803 may also need to complete Schedule CA to ensure that the reported income aligns with California tax laws. This schedule helps clarify how adjustments impact the overall tax liability, providing a comprehensive view of the family’s tax situation.
Form FTB 1131, Privacy Notice, is another document that is relevant when discussing Form 3803. While it does not directly relate to reporting income, it provides essential information regarding the privacy of taxpayer information. Understanding privacy rights is crucial for parents when filing taxes, especially when including their child’s income on their return with Form 3803. This ensures that all parties are aware of how their personal information will be used and protected.
Lastly, Form FTB 737, Tax Information for Registered Domestic Partners, is significant for families with registered domestic partners. This form provides specific tax information relevant to domestic partners in California, similar to how Form 3803 addresses the tax implications of reporting a child’s income. Both forms help clarify the responsibilities and rights of taxpayers in unique family situations, ensuring that everyone understands their obligations under California tax law.
When filling out the California 3803 form, it's important to follow specific guidelines to ensure accuracy and compliance. Here are some key do's and don'ts to keep in mind:
Understanding the California Form 3803 can be challenging. Here are some common misconceptions about this form, along with clarifications to help you navigate the process.
This is incorrect. The form can be used for children under age 19 or under age 24 if they are full-time students.
Only interest and dividend income can be reported using this form. Other types of income require different reporting methods.
If parents elect to report the child’s income, the child does not need to file a separate tax return, provided all conditions are met.
Only parents who file a Form 540 or Long Form 540NR and meet specific criteria can use this form.
In fact, the child's gross income must be less than $9,500 to qualify for this election.
California has its own specific rules and regulations that differ from federal tax laws, so the form is not interchangeable.
Any deductions that the child may qualify for cannot be used when the parents report the child's income.
The tax on the first $1,900 of the child’s interest and dividend income is generally very minimal, often resulting in a lower tax burden.
If the child’s income meets the criteria, using Form 3803 is necessary to avoid complications with tax filings.
Being informed about these misconceptions can ease the process of filing taxes for both parents and children. Always consider consulting a tax professional if you have specific questions or concerns.
1. Eligibility Requirements: To use California Form 3803, ensure your child is under age 19 or a full-time student under age 24. The child must also have income solely from interest and dividends, with a gross income of less than $9,500.
2. Parent Qualifications: Parents must file Form 540 or Long Form 540NR to report the child's income. If filing separately, the parent must have the higher taxable income to qualify. Additionally, custodial parents can make the election even if remarried, provided they meet certain income conditions.
3. Reporting Income: Use Part I of the form to calculate the child's interest and dividend income. Be sure to report all taxable income accurately, including any amounts received as a nominee, which should be noted separately.
4. Tax Calculation: In Part II, determine the tax on the first $1,900 of the child's income. If the amount exceeds $950, a flat tax of $10 applies. Otherwise, calculate the tax at a rate of 1% on the amount over the base threshold.