California Form 592 Draft - Resident And Nonresident Withholding Statement

Instructions for Form 592

Resident and Nonresident Withholding Statement

General Information

C When and Where to File

• Corporations not qualified through

the California Secretary of State to do

Tax withheld on California source payments

The tax withheld on payments to independent

business in California or having no

is reported to the Franchise Tax Board (FTB)

contractors, recipients of rents and royalties,

permanent place of business in California.

using Form 592, Resident and Nonresident

distributions to domestic nonresident

• Partnerships or limited liability companies

Withholding Statement. Form 592 includes a

S corporation shareholders, partners,

(LLCs) with no permanent place of

Schedule of Payees section, on Side 2, that

members, and beneficiaries of estates and

business in California.

requires the withholding agent to identify

trusts, are remitted in four payment periods.

• Any trust without a resident grantor,

the payment recipients (payee), the income

Each period has a specific payment due date.

beneficiary, or trustee, or estates where

amounts, and the withholding amounts. This

The payment periods and due dates are:

the decedent was not a California resident.

schedule will allow the FTB to allocate the

For the payment period:

Due Date:

•

Foreign refers to non-U.S.

withholding payments to the payee upon

January 1 through

receipt of the completed Form 592.

Round Cents to Dollars – Round cents to the

March 31, 2011 . . . . . . . . . . April 15, 2011

nearest whole dollar. For example, round $50.50

For taxable years beginning January 1,

April 1 through

up to $51 or round $25.49 down to $25.

2010, use Form 592 to report resident and

May 31, 2011 . . . . . . . . . . . . June 15, 2011

nonresident withholding and use Form 592-V,

A Purpose

June 1 through

Payment Voucher for Resident and

August 31, 2011 . . . . September 15, 2011

Nonresident Withholding, to submit resident

Use Form 592 to report the total withholding

and nonresident withholding payments when

under California Revenue and Taxation Code

September 1 through

Form 592 is submitted electronically or by

(R&TC) Sections 18662 and 18664. Use

December 31, 2011 . . . . .January 17, 2012

mail. See General Information A, Purpose, for

Form 592-V, Payment Voucher for Resident

If the due date falls on a weekend, or legal

more information.

and Nonresident Withholding, to remit

holiday, use the next business day. Due to the

withholding payments relating to Form 592.

When filing Form 592 with the FTB, the

federal Emancipation Day holiday on April 15,

The amount of resident and nonresident

withholding agent is no longer required to

2011, tax returns filed and payments received

withholding tax to be withheld shall be

submit a Form 592-B, Resident and Nonresident

on April 18, 2011, will be considered timely.

computed by applying a rate of 7% or such

Withholding Tax Statement, to the FTB, for

Send any payment due with Forms 592 and

lesser rate as authorized in writing by the

each payee. However, withholding agents must

592-V to:

FTB. Get Form 589, Nonresident Reduced

continue to provide the payees with Form 592-B

Withholding Request, for more information.

WITHHOLDING SERVICES AND

at the end of the year which shows the total

COMPLIANCE

amount withheld for that year.

The amount of backup withholding is

FRANCHISE TAX BOARD

computed by applying the rate of 7% to a

Type of Income – For taxable years beginning

PO BOX 942867

reportable payment when federal backup

January 1, 2010, you may select more than

SACRAMENTO CA 94267-0651

withholding is required (with certain limited

one type of income. This eliminates the need

exceptions). There are no reductions or

The withholding agent retains this form for a

to submit a separate Form 592 for each type of

waivers for backup withholding. Backup

minimum of four years and must provide it to

income.

withholding supersedes all types of

the FTB upon request.

Backup Withholding – Beginning on or

withholding. For more information on backup

10-Day Notification – California follows

after January 1, 2010, with certain limited

withholding, go to ftb.ca.gov and search

federal law, which requires that withholding

exceptions, payers that are required to

backup withholding.

agents notify foreign payees within 10 days

withhold and remit backup withholding to

Also, Form 592 is used by pass-through

of any tax withheld. For California withholding

the Internal Revenue Service (IRS) are also

entities to flow through withholding credits to

purposes, withholding agents should make a

required to withhold and remit to the FTB. The

their pass-through owners.

similar notification to nonresident payees. No

California backup withholding rate is 7% of the

particular form is required for this notification,

payment. For California purposes, dividends,

Important: This form is also used to report

and it is commonly done on the statement

interests, and any financial institutions release

withholding payments for a resident payee.

accompanying the distribution or payment.

of loan funds made in the normal course of

Do not use Form 592 if you are the buyer

However, the withholding agent may choose

business are exempt from backup withholding.

or escrow person withholding on the sale

to report the tax withheld to the payee on a

For additional information on California backup

of real estate. Use Form 593, Real Estate

Form 592-B.

withholding, go to ftb.ca.gov and search for

Withholding Tax Statement, and Form 593-V,

backup withholding.

Payment Voucher for Real Estate Withholding,

D Amending Form 592

• Backup withholding is required on a

to report and remit real estate withholding.

Amended forms can only be filed by the

reportable payment when federal backup

Do not use Form 592 to report tax withheld

withholding agent. To amend Form 592:

withholding is required (with certain limited

on foreign partners. For more information

exceptions). There is no set minimum

regarding reporting tax withheld on foreign

• Complete a new Form 592 with the correct

threshold.

partners, get Form 592-A, Payment Voucher

information.

• Withholding, excluding backup withholding,

for Foreign Partner or Member Withholding,

• Check the “Amended” box at the top of the

is optional, at the discretion of the withhold-

and Form 592-F, Foreign Partner or Member

revised form.

ing agent, on the first $1,500 in payments

Annual Return.

• Include a letter explaining what changes

made during the calendar year. Withholding

were made and why.

B Common Errors/Helpful Hints

must begin as soon as the total payments

• Send the amended form and letter to the

of California source income for the calendar

If you are filing Form 592 only to flow through

address listed under General Information C,

year exceed $1,500.

withholding credits to your S corporation

When and Where to File.

shareholders, partners, members, or

For California withholding purposes:

E Electronic Filing Requirements

beneficiaries, enter your information in

• Nonresident includes all of the following:

Part I as the withholding agent. Do not enter

Form 592 information must be filed with the

• Individuals who are not residents of

the name or ID number of the entity which

FTB electronically, using FTB’s Secure Web

California.

originally withheld payments from you.

Internet File Transfer (SWIFT), instead of paper

Form 592 Instructions 2010 Page 1

California Form 592 Draft - Resident And Nonresident Withholding Statement - 2011 Page 4

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