What California state tax changes should I prepare for? The largest is a sales tax on electronically delivered prewritten software starting January 1, 2027. Alongside it: an extended business tax credit limitation, a wave of states decoupling from federal research expensing, and an amnesty window that closes October 31, 2026. State tax moves faster than…
A dental practice runs three quarterly cycles that do not line up: payroll returns, federal estimated tax, and California on a 30/40/0/30 schedule.
Does California’s billionaire tax apply to me? Only if you are a California resident on January 1, 2026 and your net worth reaches $1 billion on December 31, 2026. If Proposition 40 passes on the November 3, 2026 ballot, the california billionaire tax imposes a one-time levy that phases in to 5% between $1B and…
Will California start charging sales tax on my SaaS subscriptions? Under a 2026 budget trailer bill (SB/AB 122), yes — as drafted, the California SaaS sales tax would extend the state’s 7.25% (plus district) sales and use tax to prewritten software and Software-as-a-Service beginning January 1, 2027, sourced to the purchaser’s California billing address. If…
When is a California resident beneficiary of a discretionary trust actually taxed on trust income? Only when the trustee decides to distribute. In its new Legal Ruling 2026-01, the FTB confirmed that California discretionary trust tax under R&TC section 17742 hinges on whether the beneficiary’s interest is “contingent” — and while the trustee holds sole…
What changed in state and local tax in early-to-mid June 2026? A busy stretch: the U.S. Supreme Court declined to hear Florida’s challenge to California’s single-sales-factor apportionment; New York enacted a budget that extends its top corporate rate, decouples from some OBBBA provisions, and adds a “pied-à-terre” surcharge; Texas adopted cost-of-goods-sold rule changes for franchise…
What is California’s PTE elective tax, and what changed for 2026? The pass-through entity (PTE) elective tax lets a qualifying partnership or S corporation elect to pay a 9.3% entity-level California tax on its owners’ shares of income — and the owners then claim a personal income tax credit for the tax paid on their…
Do states follow the federal QSBS exclusion under OBBBA — and why does state conformity matter? Not automatically. The One Big Beautiful Bill Act (OBBBA, Pub. L. No. 119-21) expanded the federal Qualified Small Business Stock (QSBS) exclusion under IRC §1202 — but states set their own conformity. Maine and Oregon have enacted legislation DECOUPLING…
