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Author: anshul
Alternative Minimum Tax (AMT) on California C-Corps Explained for 2025
Legal Foundation Statute: California Revenue & Taxation Code (R&TC) § 23455 adopts the federal AMT regime (IRC § 55) with state-specific rates and adjustments. Rate: 6.65 percent of California alternative minimum taxable income (AMTI) after the state exemption; 8.65 percent for banks and financial corporations. Exemption: First $40,000 of AMTI is exempt; the exemption is […]
PTET Cash-Flow Hacks for AI Founders With Investor K-1s (2025)
Statutory Frame Law: Cal. Rev. & Tax. Code §§ 19900–19906 (AB 150, as amended by SB 113). Rate: Flat 9.3 % on each consenting owner’s California-source income. Election Window: Tax years 2021-2025; sunsets before 1-1-2026. Owner Limits: Credit flows only to individuals, trusts, estates, and SMLLCs owned by them. Funds taxed as partnerships cannot claim […]
Pass-Through Entity Elective Tax (PTET) 2025: 9.3 % or Nothing?
Statutory Snapshot Law: California Revenue & Taxation Code §§ 19900 – 19906 (originally AB 150; expanded by SB 113). Rate: Flat 9.3 % of each consenting owner’s California-source income in the entity. Years Available: Tax years 2021 → 2025 (sunsets before 1-1-2026 unless Congress lifts the federal $10 k SALT cap). Federal Context: Designed to […]
LLC Gross-Receipts Fee Tiers: How Much Will Your SaaS Pay in 2025?
Statutory Authority & Who Pays California imposes a gross-receipts (“LLC”) fee—separate from the $800 franchise tax—under R&TC § 17942. Any LLC “doing business” or registered in California must pay the fee if its total California income (apportioned or sourced) meets the thresholds below, regardless of profit or loss. Federal entity classification under IRC § 7701 […]
First-Year Exemption: Can Your 2025 CA Startup Skip the $800 Fee?
Franchise-Tax Statute & Prior Relief Code Base. California Revenue & Taxation Code (R&TC) §§ 17941 & 17946 impose an $800 “annual LLC tax” on every LLC formed or “doing business” in the state, regardless of profit. Temporary Holiday (AB 85). LLCs formed Jan 1 2021 – Dec 31 2023 enjoyed a first-year waiver under A.B. […]
California LLC $800 Franchise Tax 2025: Pay, Postpone, or Waive?
Franchise Tax Basics & Legal Authority Statute. California Revenue & Taxation Code §§ 17941 & 17946 require every LLC “doing business” in the state to pay an $800 annual franchise tax. Federal tie-in. LLCs are classified under IRC §7701 & Reg. §301.7701-3; California respects that classification but imposes its own minimum tax regardless of […]
California’s Estate & Inheritance Taxes: Who Pays & How Much? (2025 Edition)
Introduction If you live in California or inherit assets from someone who did, you may wonder whether estate or inheritance taxes apply. While California has no estate or inheritance tax, large estates may still be subject to federal estate tax and other income tax consequences. Here’s what you need to know in 2025. Does California […]
Does California Have a Capital Gains Tax? (2025 Edition)
Introduction Capital gains are often taxed at preferential rates at the federal level. But in California, the story is different. Whether you’re selling stocks, real estate, or business assets, you might be surprised to find that California doesn’t distinguish capital gains from regular income. Here’s how capital gains are taxed in 2025. How Capital Gains […]
How to Claim California’s R&D Tax Credit for Businesses (2025 Edition)
Introduction California rewards businesses that invest in research and development with one of the most lucrative state tax credits available. If your company develops software, processes, or products, you may be eligible to reduce or eliminate your state tax liability using the R&D tax credit in 2025. What Is the California R&D Credit? Applicable Code: […]
The Truth About California’s “Exit Tax” for People Moving Out of State (2025 Edition)
Introduction California’s high taxes have driven many residents to move out of state, especially to states like Texas, Nevada, and Florida. But rumors of a “California Exit Tax” continue to spread. In 2025, what is fact vs. fiction? Here’s the truth about whether California can tax you after you move. What Is California’s So-Called “Exit […]