California Tax question

[Jlude]

I know there's a couple members on here residing in California.

I've googled it and all I could find is that State Income Tax in California is 9.3%... but I haven't been able to find the federal tax rate.

I'm confused... there's no way that people in the state of California only pay 9.3% tax on their income.

Anyone have some info/answers?

[benyl]

Wouldn't the Federal rate be the same, no matter where you live in the US?

[Jlude]

Originally posted by benyl
Wouldn't the Federal rate be the same, no matter where you live in the US?

I haven't been able to even find out what the federal rate is.

Hahah, I'm definitely struggling here.

I just found this website...
http://www.moneychimp.com/features/tax_brackets.htm

So now I'm wondering If I'll have to pay both state and federal taxes... which would suck very badly.

[benyl]

Yes, you have to pay both. Just like in Alberta, you have to pay both federal income tax and provincial.

[Jlude]

Looks like not much difference in what I'm paying here and what I'll be paying down there. Slight difference.

[Xtrema]

Originally posted by Jlude
Looks like not much difference in what I'm paying here and what I'll be paying down there. Slight difference.

If I remember correctly (back in the tech boom in the late 90s), you have to clear all Canadian asset if you want to avoid paying Canadian taxes.

Say you make $50K.

Uncle Sam want $15K, CRA wants $20K.

You have to pay Uncle Same $15K and then $5K to CRA.

[Jlude]

Originally posted by Xtrema


If I remember correctly (back in the tech boom in the late 90s), you have to clear all Canadian asset if you want to avoid paying Canadian taxes.

Say you make $50K.

Uncle Sam want $15K, CRA wants $20K.

You have to pay Uncle Same $15K and then $5K to CRA.

You are correct, I've looked into this as well.

[blownz]

Originally posted by Jlude
Looks like not much difference in what I'm paying here and what I'll be paying down there. Slight difference.

Remember down there you have a ton of deductions that you don't have here that will lower your tax and increase your take home. Interest on your mortgage for example. And even your interest on an rv loan is tax deductible.

[Antonito]

I've heard somewhere that as long as you don't have a residence in Canada, you can simply 'give up your citizenship' in such a way as to avoid paying taxes, but are able to get it back once you come back to the country. Basically not having to pay for services you aren't using kind of a deal

Any truth to this?

[googe]

Originally posted by blownz


Remember down there you have a ton of deductions that you don't have here that will lower your tax and increase your take home. Interest on your mortgage for example. And even your interest on an rv loan is tax deductible.

Haha, except no one has mortgages in California, and whoever does is wishing they didn't right now ;)

[blownz]

But if you are just moving down and looking now you likely won't be doing too bad.

[Jlude]

Originally posted by blownz


Remember down there you have a ton of deductions that you don't have here that will lower your tax and increase your take home. Interest on your mortgage for example. And even your interest on an rv loan is tax deductible.

Yes, I've found that out as well. A great deal of deductions. I think I'll just hire an accountant once I get there to take care of it all.


Originally posted by blownz
But if you are just moving down and looking now you likely won't be doing too bad.

It's actually ideal for someone moving down there right now, the real estate has taken a hit, but who knows if it will go down again. I think I'm gonna rent for the first 6-12 months to get a feel for the area.

The thing is, a rental apt. is around 1700/month for a one bedroom, 800sq/ft condo. To buy that same condo with a decent down payment, you'd only be paying 1200+/-/month. And as said before, the interest of your mortgage can be deducted from your taxes.

[Zephyr]

We just have the usual California State Tax and Federal. Then of course you get the medicare and social security

Donate things to like salvation army, libraries and schools if you need deductions. Any expenses towards a higher education is also deductible.

[Jlude]

Originally posted by Zephyr
We just have the usual California State Tax and Federal. Then of course you get the medicare and social security

Donate things to like salvation army, libraries and schools if you need deductions. Any expenses towards a higher education is also deductible.

I called a couple of banks where I'll be living and they said I couldn't open an account until I had a social security code and other banks said I didn't need one, all I needed was my immigration papers.

I'll get it taken care of when I get down there.

Start date is March 1st and I still have to buy a car, get my finances switched over, buy furniture... ect.

[googe]

k

[max_boost]

Maybe this link might help you.

http://www.bankrate.com/brm/itax/edit/state/profiles/state_tax_Cal.asp

[Antonito]

Originally posted by Jlude

Start date is March 1st and I still have to buy a car, get my finances switched over, buy furniture... ect.

Maybe a little less time on Beyond would be a good idea.... :D

[Jlude]

Originally posted by Antonito


Maybe a little less time on Beyond would be a good idea.... :D
I've done all I can do from this side of the border, everything else has to be finalized once I get to Cali.


Oh I'll be on a lot less once I start the new job.

And it'll be too nice outside to be sitting inside on a computer.

[googe]

so I was wondering, are you moving to california?

[Jlude]

Originally posted by googe
so I was wondering, are you moving to california?

Nope... actually moving to Maine, but I thought I'd find out everything I can about California. Just in case I want to visit, cause they're close, right?

[Zephyr]

Originally posted by Jlude


I called a couple of banks where I'll be living and they said I couldn't open an account until I had a social security code and other banks said I didn't need one, all I needed was my immigration papers.

I'll get it taken care of when I get down there.

Start date is March 1st and I still have to buy a car, get my finances switched over, buy furniture... ect.

Open up a bank account at Washington Mutual www.wamu.com unless you like hidden fees, then go with Bank of America or Wells Fargo

[Jlude]

Originally posted by Zephyr


Open up a bank account at Washington Mutual www.wamu.com unless you like hidden fees, then go with Bank of America or Wells Fargo

I'll look into it. Thanks for the tip.

[PeterGTiR]

I'm no expert, but:

You want to sever all primary and limit your secondary ties to Canada.

http://www.cra-arc.gc.ca/tax/nonresidents/common/residency-e.html

If you don't, you'll still be consider a resident of Canada and need to file Canadian tax returns. Canada taxes on residency rather than citizenship. If you keep your residential ties, you'll have to file both Canadian and US returns - you can claim foreign tax credits, but it's probably going to be a huge hassle.

Your US federal tax rates are here:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf

I imagine they'll change for 2008, but I don't think it'll change much.

[Jlude]

Originally posted by PeterGTiR
I'm no expert, but:

You want to sever all primary and limit your secondary ties to Canada.

http://www.cra-arc.gc.ca/tax/nonresidents/common/residency-e.html

If you don't, you'll still be consider a resident of Canada and need to file Canadian tax returns. Canada taxes on residency rather than citizenship. If you keep your residential ties, you'll have to file both Canadian and US returns - you can claim foreign tax credits, but it's probably going to be a huge hassle.

Your US federal tax rates are here:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf

I imagine they'll change for 2008, but I don't think it'll change much.

That's really helpful... especially the residency link.

Thanks!