The California Form 592-B is a tax statement used to report withholding on payments made to both residents and nonresidents. This form is essential for ensuring compliance with California tax laws regarding income subject to withholding. If you need to fill out this form, click the button below to get started.
The California Form 592-B serves a crucial role in the state's tax system, specifically regarding withholding for both residents and nonresidents. This form is utilized by withholding agents—such as corporations, partnerships, and trusts—to report amounts withheld from payments made to recipients. It encompasses various types of income subject to withholding, including payments to independent contractors, estate distributions, and rental income. Notably, the form requires detailed information about both the withholding agent and the recipient, including names, addresses, and taxpayer identification numbers. Additionally, it outlines the total income subject to withholding, the total California tax withheld, and any backup withholding applied. As tax rates have evolved, particularly since 2012, it is essential for withholding agents to remain informed about current rates and regulations to ensure compliance. The form must be provided to recipients by January 31 of the following year, ensuring that they have the necessary documentation for their own tax filings. Understanding and accurately completing Form 592-B is vital for both withholding agents and recipients to meet their tax obligations and avoid potential penalties.
TAXABLE YEAR
Resident and Nonresident Withholding
CALIFORNIA FORM
2012 Tax Statement
592-B
Part I Withholding Agent
Name of withholding agent (Payer/S Corporation/Partnership/LLC/Trust)
SSN or ITIN
Address (suite, room, PO Box, or PMB no.)
FEIN
CA Corp no. SOS file no.
City
State
ZIP Code
Daytime telephone number
(
)
Part II Recipient
Name of recipient
DBA (if applicable)
Part III Type of Income Subject to Withholding. Check the applicable box(es).
A Payments to Independent Contractors
E Estate Distributions
G Payments to Independent Contractor
B Trust Distributions
F Allocations to Foreign (non-U.S.)
Entertainers/Athletes/Speakers
C Rents or Royalties
Nonresident Partners/Members
H Other ___________________________
D Distributions to Domestic (U.S.)
(describe)
Nonresident Partners/Members/
Beneficiaries/S Corporation Shareholders
Part IV Tax Withheld
1 Total income subject to withholding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2 Total California tax withheld (excluding backup withholding). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3 Total Backup Withholding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Withholding Agent Instructions
What’ New
Increase in Rates – For taxable years beginning on or after January 1, 2012, the maximum personal income tax rate increased to 12.3%. In addition, non-California partnerships are subject to withholding requirements on a sale of California real property at a rate of 3 1/3% (.0333) of sales price or 12.3% of gain. The alternative withholding rate for the gain on sale of California real property by S corporations increased to 13.8% and 15.8% for financial
S corporations.
General Information
Backup Withholding – Beginning on or after January 1, 2010, with certain limited exceptions, payers that are required to withhold and remit backup withholding to the Internal Revenue Service (IRS) are also required to withhold and remit to the Franchise Tax Board (FTB). The California backup withholding rate is 7% of the payment. For California purposes, dividends, interests,
and any financial institutions release of loan funds made in the normal course of business
are exempt from backup withholding. For additional information on California backup withholding, go to ftb.ca.gov and search for backup withholding.
Registered Domestic Partners (RDPs) – Under California law, RDPs must file their California income tax returns using either the married/RDP filing jointly or married/RDP filing separately filing status. RDPs have the same legal benefits, protections, and responsibilities as married couples unless otherwise specified.
If you entered into a same-sex legal union in another state, other than a marriage, and that union has been determined to be substantially equivalent to a California registered domestic partnership, you are required to file a California income tax return using either the married/RDP filing jointly or married/RDP filing separately filing status.
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
For purposes of Form 592-B, the term “nonresident” refers to both domestic and foreign recipients. A domestic nonresident is a person living outside of California, but living in the United States. If you are a resident living outside of the United States, you are a foreign nonresident.
Use Form 592-B to report to the recipient the amount of payment or distribution subject to withholding and tax. Complete a separate Form 592-B for each resident or nonresident. Pass-through entities which were withheld upon by another entity should use Form 592 to flow-through the withholding to their S corporation shareholders, partners, members, or beneficiaries whether they are residents or nonresidents of California.
Use Form 592-V, Payment Voucher for Resident and Nonresident Withholding, to remit withholding payments during the year. To remit foreign partner withholding payments use Form 592-A, Payment Voucher for Foreign Partner or Member Withholding.
For Privacy Notice, get form FTB 1131.
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Form 592-B 2011 (REV 12-12)
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visit our website:
ftb.ca.gov
Page 2 Form 592-B 2011
B Common Errors/Helpful Hints
•Get taxpayer identification numbers (TINs) from all payees.
•Complete all fields.
•Complete all forms timely to avoid penalties.
C Who Must Complete
Form 592-B must be completed by any person who:
•Has withheld on payments to residents or nonresidents.
•Has withheld backup withholding on payments to residents or nonresidents.
•Is a pass-through entity that was withheld upon and must flow-through the withholding credit.
Record Keeping
The withholding agent retains the proof of withholding for a minimum of four years and must provide it to the FTB upon request. Form 592-B is provided to the recipient to file with their state tax return. This form can be provided to the payee electronically. A broker can provide Form 592-B as a composite statement. For more information go to ftb.ca.gov and search for electronic 592-B requirements.
D When To Complete
Form 592-B must be provided to:
•Each resident or nonresident by January 31 following the close of the calendar year, except for brokers as stated in Internal Revenue Code (IRC) Section 6045.
•A recipient before February 15 following the close of the calendar year for brokers.
•Foreign partners in a partnership or members in a limited liability company (LLC) on
or before the 15th day of the 4th month following the close of the taxable year.
If all the partners in the partnership or members in the LLC are foreign, Form(s) 592-B must be provided on or before the 15th day of the 6th month after the close of the taxable year.
When making a payment of withholding tax to the IRS under IRC Section 1446, a partnership must notify all foreign partners of their allocable shares of any IRC Section 1446 tax paid to the IRS by the partnership. The partners use this information to adjust the amount of estimated tax that they must otherwise pay to the IRS. The notification to the foreign partners must be provided within 10 days of the installment due date, or, if paid later, the date the installment payment is made. See Treas. Regs. Section 1.1446-3(d)(1)(i) for information that must be included in
the notification and for exceptions to the notification requirement. For California withholding purposes, withholding agents should make a similar notification. No particular form is required for this notification, and it is commonly done on the statement
accompanying the distribution or payment. However, the withholding agent may choose to report the tax withheld to the payee on a Form 592-B.
E Penalties
The withholding agent must furnish complete and correct copies of Form(s) 592-B to the recipient (payee) by the due date.
If the withholding agent fails to provide complete, correct, and timely Form(s) 592-B to the recipient (payee), the penalty per Form 592-B is:
•$50 for each payee statement not provided by the due date.
•$100 or 10 percent of the amount required to be reported (whichever is greater), if the failure is due to intentional disregard of the requirement.
Specific Instructions
Year – Make sure the year in the upper left corner of Form 592-B represents the calendar year in which the withholding took place. If an S corporation’s, partnership’s, LLC’s, or trust’s current distribution represents a prior taxable year of California source income, the taxable year on Form 592-B must represent the year the income was earned. (Except for foreign partners, withholding of tax by withholding agents must be on a calendar-year basis, regardless of the accounting period adopted by the payee or withholding agent.)
For foreign partners in a partnership, or foreign members in an LLC, make sure the year in the upper left corner of Form 592-B is the year that the partnership’s or LLC’s taxable year ended. For example, if the partnership’s or LLC’s taxable year ended 12/31/09, use the 2009 Form 592-B.
Private Mail Box (PMB) – Include the PMB in the address field. Write “PMB” first, then the box number. Example: 111 Main Street PMB 123.
Foreign Address – Enter the information in the following order: City, Country, Province/ Region, and Postal Code. Follow the country’s practice for entering the postal code. Do not abbreviate the country’s name.
Part I – Withholding Agent
Enter the withholding agent’s name, tax identification number, address, and telephone number.
Part II – Recipient
Enter the name of recipient, DBA (if applicable), tax identification number, and address for the recipient (payee).
If the recipient is a grantor trust, enter the grantor’s individual name and social security number (SSN) or individual taxpayer identification number (ITIN). Do not enter the name of the trust or trustee information. (For
tax purposes, grantor trusts are transparent. The individual grantor must report the income and claim the withholding on the individual’s California tax return.)
If the recipient is a non-grantor trust, enter the name of the trust and the trust’s federal employer identification number (FEIN). Do not
enter trustee information.
If the trust has applied for a FEIN, but it has not been received, zero fill the space for the trust’s FEIN and attach a copy of the federal application behind Form 592-B. After the FEIN is received, amend Form 592-B to submit the assigned FEIN.
Only withholding agents can complete an amended Form 592-B. Upon completion, the withholding agent should provide a copy of the amended Form 592-B to the recipient. If a recipient notices an error, the recipient should contact the withholding agent.
If the recipients are married/RDP, enter only the name and SSN or ITIN of the primary spouse/RDP. However, if the recipients intend to file separate California tax returns, the withholding agent should split the withholding and complete a separate Form 592-B for each spouse/RDP.
Part III – Type of Income Subject to Withholding
Check the box(es) for the type of income subject to withholding.
Part IV – Tax Withheld
Line 1
Enter the total income subject to withholding.
Line 2
Enter the total California tax withheld (excluding backup withholding). The amount of tax to be withheld is computed by applying a rate of 7% on items of income subject to withholding, i.e. interest, dividends, rents and royalties, prizes and winnings, premiums, annuities, emoluments, compensation
for personal services, and other fixed or determinable annual or periodical gains, profits and income. For foreign partners, the rate is 8.84% for corporations, 10.84% for banks and financial institutions, and 12.3% for all others. For pass through entities, the amount withheld is allocated to partners, members,
S corporation shareholders, or beneficiaries, whether they are residents or nonresidents of California, in proportion to their ownership or beneficial interest.
Line 3
Enter the total backup withholding. Compute backup withholding by applying a 7% rate to all reportable payments subject to IRS backup withholding with a few exceptions. For California purposes dividends, interests, and any financial institutions release of loan funds made in the normal course of business are exempt from backup withholding.
Form 592-B 2011 (REV 12-12) Page 3
Instructions for Recipient
This withholding of tax does not relieve you of the requirement to file a California tax return within three months and fifteen days (two months and fifteen days for a corporation) after the close of your taxable year.
You may be assessed a penalty if:
•You do not file a California tax return.
•You file your tax return late.
•The amount of withholding does not satisfy your tax liability.
How to Claim the Withholding
Report the income as required and enter the amount from Form 592-B, Part IV, line 2 on your California tax return as real estate and other withholding from Form(s) 592-B or 593. Attach a copy of Form 592-B to your California tax return. If you received a composite statement from a broker, attach only the Form 592-B information. Make a copy for your records.
If you have an amount in line 3, backup withholding, you must provide us with your TIN before filing your tax return. Using the information provided on this page, contact us as soon as you receive this form. Failure to provide your TIN will result in a denial of your backup withholding credit.
If you are an S corporation, partnership, or LLC, you may either flow-through the entire amount to your shareholders, partners, or members or claim the withholding, to the extent of your outstanding tax liability, on your tax return.
If the withholding exceeds the amount of tax you still owe on your tax return, you must flow-through the excess to your shareholders, partners, or members.
If you do not have an outstanding balance on your tax return, you must flow-through the entire amount to your shareholders, partners, or members. Use Form 592 to flow the withholding to your partners or members.
If you are an estate or trust, you must flow- through the withholding to your beneficiaries if the related income was distributed. Use Form 592 to flow-through the withholding to your beneficiaries. If you did not distribute the income, you must claim the withholding on the fiduciary return, Form 541, California Fiduciary Income Tax Return.
The amount shown as “Total income subject to withholding” may be an estimate or may only reflect how withholding was calculated. Be sure to report your actual taxable California source income. If you are an independent contractor or receive rents or royalties, see your contract and/or Form 1099 to determine your California source income. If you are an S corporation shareholder, partner, member, or beneficiary of an S corporation, partnership, LLC, estate, or trust, see your California Schedule K-1 (100S, 565, 568, 541), Share of Income, Deductions, Credits, etc., issued by that entity to determine your California source income.
Additional Information
For more information or to speak to a representative regarding this form, call the Withholding Services and Compliance’s automated telephone service at: 888.792.4900 or 916.845.4900.
OR write to:
WITHHOLDING SERVICES AND COMPLIANCE FRANCHISE TAX BOARD
PO BOX 942867 SACRAMENTO CA 94267-0651
For all other questions unrelated to withholding or to access the TTY/TDD number, see the information below.
Internet and Telephone Assistance Website: ftb.ca.gov
Telephone: 800.852.5711 from within the United States 916.845.6500 from outside the United States
TTY/TDD: 800.822.6268 for persons with hearing or speech impairments
OR to get forms by mail, write to:
TAX FORMS REQUEST UNIT FRANCHISE TAX BOARD PO BOX 307
RANCHO CORDOVA CA 95741-0307
Asistencia Por Internet y Teléfono
Sitio web:
Teléfono:
800.852.5711 dentro de los
Estados Unidos
916.845.6500 fuera de los Estados
Unidos
TTY/TDD:
800.822.6268 personas con
discapacidades auditivas y del
habla
Page 4 Form 592-B 2011
Filling out the California 592 B form requires careful attention to detail. Each section must be completed accurately to ensure compliance with state regulations. After submitting the form, recipients will use it to report income subject to withholding on their California tax returns.
What is the purpose of the California 592-B form?
The California 592-B form is used to report the amount of payment or distribution that is subject to withholding tax for both resident and nonresident recipients. This form is essential for withholding agents, such as S corporations, partnerships, LLCs, and trusts, to inform recipients about the income that has been withheld for tax purposes. It helps ensure that the correct amount of tax is reported and remitted to the California Franchise Tax Board (FTB). Each recipient must receive a separate Form 592-B, which they will use when filing their state tax return.
Who is required to complete the 592-B form?
Any individual or entity that has withheld taxes on payments made to residents or nonresidents must complete the 592-B form. This includes those who have withheld backup withholding on such payments. Additionally, pass-through entities that have been withheld upon must use this form to flow-through the withholding credit to their partners, members, or shareholders. It is crucial for withholding agents to retain proof of withholding for a minimum of four years and provide it to the FTB upon request.
When must the 592-B form be provided to recipients?
The 592-B form must be provided to each resident or nonresident recipient by January 31 of the year following the close of the calendar year. For brokers, the deadline is February 15. If the recipient is a foreign partner in a partnership or a member of an LLC, the form must be provided by the 15th day of the fourth month following the close of the taxable year. In cases where all partners or members are foreign, the deadline extends to the 15th day of the sixth month after the close of the taxable year.
What are the penalties for failing to provide the 592-B form correctly?
Withholding agents face penalties for failing to furnish complete and correct copies of Form 592-B to recipients by the due date. The penalty is $50 for each payee statement not provided on time. If the failure is due to intentional disregard of the requirement, the penalty increases to $100 or 10% of the amount that should have been reported, whichever is greater. It is essential for withholding agents to ensure accuracy and timeliness to avoid these penalties.
Filling out the California 592 B form can be straightforward, but many people make common mistakes that can lead to delays or penalties. One frequent error is failing to include the correct taxpayer identification number (TIN) for both the withholding agent and the recipient. It's crucial to ensure that the SSN, ITIN, or FEIN is accurate and complete. Missing or incorrect numbers can cause processing issues and may lead to penalties.
Another mistake often made is neglecting to complete all required fields. Each section of the form must be filled out entirely. Leaving blank spaces can result in the form being returned for correction, delaying the processing of your withholding obligations. Make it a habit to double-check that every section is complete before submission.
Timeliness is also a significant factor. Many individuals overlook the deadlines for submitting the 592 B form. It must be provided to each recipient by January 31 of the following year. If you miss this deadline, you may face penalties. Set reminders to ensure you meet these important dates.
Some people mistakenly check the wrong boxes in Part III, which indicates the type of income subject to withholding. This can lead to incorrect withholding amounts and potential tax complications down the line. Review the instructions carefully and ensure the appropriate boxes are checked for the income types applicable to your situation.
When reporting the tax withheld, errors can occur in calculating the amounts on lines 1, 2, and 3. Make sure to apply the correct rates and sum up the totals accurately. Miscalculations can not only lead to penalties but may also complicate your tax situation when filing returns.
Lastly, individuals often forget to keep proper records of the withholding for at least four years. This documentation is essential should the Franchise Tax Board request proof of withholding. Without adequate records, you may find yourself unprepared to address any inquiries or disputes that arise.
The California 592 B form is essential for reporting withholding on payments made to both residents and non-residents. However, it is often accompanied by other forms and documents that further clarify tax obligations and ensure compliance with California tax laws. Below are four commonly used forms that may accompany the 592 B form.
Understanding these forms and their purposes is crucial for anyone involved in withholding payments in California. Properly completing and submitting these documents can help avoid penalties and ensure compliance with tax regulations. Always consult a tax professional if there are uncertainties regarding the use of these forms.
The California 592 B form is an important document for reporting withholding on payments made to residents and nonresidents. Several other forms serve similar purposes, ensuring compliance with tax withholding regulations. Here’s a list of documents that share similarities with the California 592 B form:
Understanding these forms can help ensure compliance with tax regulations and avoid potential penalties. Each form plays a critical role in the broader context of tax withholding and reporting.
When filling out the California 592 B form, it’s important to follow specific guidelines to ensure accuracy and compliance. Here are five things to do and avoid:
Understanding the California Form 592-B can be challenging. Here are seven common misconceptions about this form, along with clarifications to help you navigate its requirements.
This form applies to both residents and nonresidents. Nonresidents include those living outside California but within the United States, as well as foreign individuals living outside the U.S.
While independent contractors are included, the form is also used for various types of income, including rents, royalties, and distributions to nonresident partners or beneficiaries.
Penalties can be significant. If the form is not provided on time, the withholding agent may face fines of $50 per payee statement or greater penalties for intentional disregard of the requirements.
While electronic submission is allowed, it must meet specific requirements set by the Franchise Tax Board. Ensure you check these guidelines before proceeding.
Form 592-B is specifically for reporting payments subject to withholding. Not all income types are eligible, so it’s crucial to verify whether your income falls within the required categories.
Withholding agents must retain proof of withholding for at least four years. This documentation is essential if the Franchise Tax Board requests it.
Receiving this form does not eliminate your obligation to file a California tax return. You must report the income and the withholding amount as required.
By clarifying these misconceptions, you can better understand your obligations regarding Form 592-B and ensure compliance with California tax laws.
The California 592-B form is essential for reporting payments subject to withholding for both residents and nonresidents. Each withholding agent must complete a separate form for every recipient.
Timeliness is crucial. The withholding agent must provide the completed form to recipients by January 31 of the following year, ensuring compliance with state regulations.
Accurate completion of all fields is necessary to avoid penalties. Common errors include missing taxpayer identification numbers and incomplete information.
Record keeping is mandatory. Withholding agents must retain proof of withholding for at least four years and must be prepared to provide this documentation upon request from the Franchise Tax Board.