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# 2009-25 : California withholding increased

Monday, November 02, 2009

California withholding increased

Employers began withholding 10% more California tax on November 1st, if they began using new tables sent by the state. This change has been in the news and we want to correct some misconceptions:

The withholding increase is not part of a tax increase. However, legislation earlier this year raised the personal income tax rates by 0.25% and cut dependent exemption credits by two thirds. So, many clients will see a 2009 tax increase; and
The 10% increase is not scheduled to expire December 31, 2009. It will continue indefinitely.

However, it is true that the increase is "voluntary" and you may adjust withholding to have the proper amount withheld rather than the extra 10%.

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This information is provided with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional advice and assumes no liability whatsoever in connection with its use. Because tax laws are constantly changing, and are subject to differing interpretations, we urge you to do additional research before acting on the information contained in this document.

Original material in Spidell's California Taxes On-Line is copyrighted and may be reproduced for educational purposes or quoted by crediting Spidell's California Taxes On-Line.

Spidell's California Taxes On-Line is operated by Spidell Publishing, Inc., P.O. Box 61044, Anaheim, CA 92803-6144. FAX: (714) 776-9906.

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