Download California 590 P Form

Things to Do When Filling Out the California 590 P Form:

• Ensure that all personal information, including name and address, is accurate and complete.
• Certify that the income has already been reported on your California tax return.
• Include a daytime telephone number for any necessary follow-up.
• Keep a copy of the form for your records, as it must be retained by the withholding agent for a minimum of four years.

Things Not to Do When Filling Out the California 590 P Form:

• Do not submit the form to the Franchise Tax Board (FTB); it should be retained by the withholding agent.
• Do not use this form if you are a foreign partner or member.
• Avoid leaving any fields blank; incomplete forms may lead to processing delays.
• Do not sign the form if you have not filed your California income tax return.

Misconceptions about the California 590 P form can lead to confusion and missteps. Let’s clear up some common misunderstandings:

• Only California residents can use the form. This is not true. The 590 P form is specifically for nonresident S corporation shareholders, partners, or members who have already reported income from California sources. Foreign partners or members cannot use this form.
• Form 590 P must be submitted to the Franchise Tax Board (FTB). In reality, this form is retained by the S corporation, partnership, or LLC and is not submitted to the FTB. However, it must be available for review if requested by the FTB.
• Using Form 590 P exempts everyone from withholding. This is a misconception. The form only exempts those who have reported the income on their California tax return. If you haven't reported the income yet, you need to use a different form to request a waiver of withholding.
• There is no minimum threshold for withholding. Actually, if the total distributions of California source income to a nonresident are $1,500 or less during the calendar year, no withholding is required. This is an important detail that can save time and effort.

Understanding these points can help ensure that you navigate the tax landscape more effectively and avoid unnecessary complications.

The California 590 P form is an important document used by nonresident shareholders, partners, or members of S corporations, partnerships, or LLCs to certify that they have already reported certain income on their California tax returns. Along with this form, several other documents may be needed to ensure compliance with California tax laws and to facilitate the withholding exemption process. Below is a list of commonly used forms and documents that often accompany the California 590 P form.

• Form 590: This is the Withholding Exemption Certificate for California residents. It is used by California residents to claim an exemption from withholding on income distributions from S corporations, partnerships, or LLCs.
• Form 588: This Nonresident Withholding Waiver Request allows nonresidents to request a waiver of withholding on payments of current year California source income. It is useful when the income has not yet been reported on a tax return.
• Form 1099: This form reports various types of income other than wages, salaries, and tips. It is often issued to report income received from S corporations, partnerships, or LLCs, which may be relevant for nonresidents.
• Schedule K-1: This document reports each partner's or shareholder's share of income, deductions, and credits from partnerships or S corporations. It is crucial for completing individual tax returns accurately.
• Form 1040NR: This is the U.S. Nonresident Alien Income Tax Return. Nonresident individuals use this form to report their income and calculate their tax liability.
• Form 540NR: This is the California Nonresident or Part-Year Resident Income Tax Return. It is used by nonresidents to report income earned in California and to determine their California tax obligations.
• Form FTB 1131: This Privacy Notice informs individuals about how their personal information is used and protected by the California Franchise Tax Board, which may be relevant when submitting tax forms.
• Form 941: This is the Employer's Quarterly Federal Tax Return. While primarily for employers, it may be relevant for partnerships or LLCs that have employees and need to report withholding taxes.
• Form 1065: This is the U.S. Return of Partnership Income. Partnerships use this form to report their income, deductions, and credits, which may impact the tax obligations of partners.
• Form 1120S: This is the U.S. Income Tax Return for an S Corporation. It is used by S corporations to report income, deductions, and other tax-related information, which is essential for shareholders.

These documents play a vital role in ensuring compliance with California tax regulations and can help clarify the tax obligations of nonresident partners and shareholders. It is important to have these forms ready and accurately completed to avoid any issues with tax withholding or reporting.