The California Franchise Tax Board (FTB) administers and collects state personal
income tax
An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Tax ...
and corporate
franchise
Franchise may refer to:
Business and law
* Franchising, a business method that involves licensing of trademarks and methods of doing business to franchisees
* Franchise, a privilege to operate a type of business such as a cable television p ...
and income tax of
California
California is a U.S. state, state in the Western United States, located along the West Coast of the United States, Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the List of states and territori ...
. It is part of the
California Government Operations Agency.
The board is composed of the
California State Controller
The state controller of California is a constitutional office in the executive branch of the government of the U.S. state of California. Thirty-two individuals have held the office of state controller since statehood. The incumbent is Betty Yee ...
, the director of the
California Department of Finance
The California Department of Finance is a state cabinet-level agency within the government of California. The Department of Finance is responsible for preparing, explaining, and administering the state's annual financial plan, which the Governor o ...
, and the chair of the
California Board of Equalization. The chief administrative official is the executive officer of the Franchise Tax Board.
History
In 1879 California adopted its
state constitution which among many other programs created the
State Board of Equalization and the
State Controller, which administered all tax programs.
[Publication]
Franchise Tax Board at a Glance, page 2
/ref>
In 1929, the state legislature created the office of the
Franchise Tax Commissioner to administer California’s
Bank and Corporation Franchise Tax Act.
In 1950, California abolished the office of the Franchise
Tax Commissioner and created the Franchise Tax
Board as it exists today.
The Executive Officer of the Franchise Tax Board is Selvi Stanislaus, the first woman to hold the post. She assumed this position in 2006. The prior FTB Executive Officers were:
John J. Campbell (1950 - 1963)
Martin Huff (1963 - 1979) (During the first eight months of 1980, the department was under the direction of Jeffrey Smith who was named Acting Executive Officer.)
Gerald H. Goldberg (1980 - 2005) (During the last five months of 2005, the department was under the direction Will Bush who was appointed Interim Executive Officer by the Board.)
Members
The three members are the State Controller, Chair of the Board of Equalization, and the Director of the Department of Finance.
Notes
Tax programs
Personal income tax
The FTB collects personal state income taxes. The FTB collects income taxes from California residents on their income from all sources.[Publication]
Franchise Tax Board at a Glance, page 4
/ref> Meanwhile, non-residents are taxed on their California-based income. In recent years, the FTB collects more than $50 billion each year in personal income taxes.[State Controller's Office]
Corporate income tax
The FTB levies a franchise tax
A franchise tax is a government levy (tax) charged by some US states to certain business organizations such as corporations and partnerships with a nexus in the state. A franchise tax is not based on income. Rather, the typical franchise tax ca ...
on businesses for doing business in California. The FTB's name reflects the fact that it was originally created to collect this tax. The agency's name was left unchanged even after the state created a personal income tax and added it to the FTB's responsibilities.
The corporate tax is imposed on businesses that do business in California and derive income from within California. Over the past decade, the FTB has collected an average of $9.5 billion per year in corporate income taxes.
Non-tax programs
The FTB also collects delinquent vehicle registration debt collection
Debt collection is the process of pursuing payments of debts owed by individuals or businesses. An organization that specializes in debt collection is known as a collection agency or debt collector. Most collection agencies operate as agents of ...
s on behalf of the California Department of Motor Vehicles
The California Department of Motor Vehicles (DMV) is the state agency that registers motor vehicles and boats and issues driver licenses in the U.S. state of California. It regulates new car dealers (through the New Motor Vehicle Board), c ...
and delinquent court ordered debt. The FTB also does financial audits of certain candidates for state office, ballot proposition committees, and lobbyists, according to a random selection process by the California Fair Political Practices Commission
The Fair Political Practices Commission (FPPC) of California is a five-member independent nonpartisan commission that has primary responsibility for the impartial and effective administration of the Political Reform Act of 1974. The Commission's ...
.
See also
*State income tax
In addition to Federal government of the United States, federal Income tax in the United States, income tax collected by the United States, most individual U.S. states collect a state income tax. Some local governments also impose an income tax, ...
*State tax levels
State tax levels indicate both the tax burden and the services a state can afford to provide residents.
States use a different combination of sales, income, excise taxes, and user fees. Some are levied directly from residents and others are ...
*Taxation in the United States
The United States, United States of America has separate Federal government of the United States, federal, U.S. state, state, and Local government in the United States, local governments with taxes imposed at each of these levels. Taxes are lev ...
References
External links
California Franchise Tax Board website
Franchise Tax Board
in the California Code of Regulations
The California Code of Regulations (CCR, Cal. Code Regs.) is the codification of the general and permanent rules and regulations (sometimes called administrative law) announced in the ''California Regulatory Notice Register'' by California state ...
Revenue and Tax Code
{{Authority control
Franchise Tax Board
The California Franchise Tax Board (FTB) administers and collects state personal income tax and corporate franchise and income tax of California. It is part of the California Government Operations Agency.
The board is composed of the California ...
Taxation in California
US state tax agencies
Government agencies established in 1950
1950 establishments in California