California state tax basis is the Federal Adjusted Gross Income (AGI). So you can prepare state tax return only after preparing your federal income taxes. You need to carryforward the Federal AGI to your state tax form. This amount is adjusted for the state income additions, tax deductions, tax credits and state exemptions to figure out the state taxable income. California follow the Joint filing system for married filing joint taxpayers. You can find below the major differences between the tax treatement of various taxes by Fedeal and California State Taxes.

Interest/Divident Income: Interest and Divident income from U.S. government bonds are exempt from State Taxes.

Rent Income: California depreciation methods and accelerated write-offs.

Capital Gain: The Capital Gains are treated similar to Federal Taxes for State Taxes.

Unemployment Income: Unemployment income is exempt from state taxes.

Social Security Benefits: All social security income is exempt from state taxes.

State Bond Interest: Taxable except California obligations.

Health Savings Accounts: There is no provision for state tax tax deduction from for the Health Saving Accounts.

Disability: Same as federal.

Lottery: California lottery winnings exempt.

Federal Income Tax: Not deductible.

Other Taxes: Exempt government rewards from a crime hotline and beverage container recycling income. Deductions for certain rebates for water and energy conservation. Exclusions for employerprovided accident and health insurance, self-employed health insurance, and medical expense reimbursement apply with respect to registered domestic partners. The following federal exemptions do not apply: educator expenses, tuition and fees, and student loan interest.

Check other state tax links below.