California has one of the most complex income tax systems in the U.S. Whether you’re a full-time employee, freelancer, or small business owner, knowing the California income tax rate helps you plan your finances better.
With multiple tax brackets and local surcharges, it’s essential to understand how much of your income goes to the state and what deductions you can claim in 2025.
Overview of California Income Tax
California uses a progressive income tax system, meaning the higher your income, the higher percentage you pay. The Franchise Tax Board (FTB) collects this tax, which helps fund essential services like education, healthcare, and infrastructure.
In 2025, California continues to have nine income tax brackets, ranging from 1% to 12.3%, with an additional 1% Mental Health Services Tax on income above $1 million.
California State Income Tax Rates for 2025
Here’s a breakdown of the 2025 tax brackets for single filers (married and head-of-household brackets differ slightly but follow the same structure):
| Tax Rate | Taxable Income (Single Filers) |
|---|---|
| 1% | Up to $10,800 |
| 2% | $10,801 – $25,600 |
| 4% | $25,601 – $40,300 |
| 6% | $40,301 – $56,000 |
| 8% | $56,001 – $71,700 |
| 9.3% | $71,701 – $364,250 |
| 10.3% | $364,251 – $437,500 |
| 11.3% | $437,501 – $590,750 |
| 12.3% | Over $590,750 |
| +1% Surtax (Mental Health Services Tax) | Income over $1 million |
Note: Brackets are adjusted yearly for inflation by the California FTB.
Example: How to Calculate Your California Income Tax
Let’s take a simple example. Suppose you’re a single filer earning $100,000 in 2025. Your income crosses multiple brackets, so only part of your income is taxed at each rate:
- 1% on the first $10,800 = $108
- 2% on $14,800 = $296
- 4% on $14,700 = $588
- 6% on $15,700 = $942
- 8% on $15,700 = $1,256
- 9.3% on remaining $28,300 = $2,631.90
Add them all up: your total California income tax = $5,821.90 (before deductions or credits).
If you earned $1.2 million, you’d also pay the 1% Mental Health Services Tax, which adds an extra $2,000 on top of your total.
Deductions and Credits That Lower Your Tax Bill
Even though the rates seem high, there are ways to reduce your taxable income. Common deductions include:
- Standard deduction: $5,202 for single filers, $10,404 for joint filers.
- Personal exemption credit: $146 for single, $292 for married couples.
- Renters’ credit: $60 (single) or $120 (married) if you rent your home.
- Charitable donations and education expenses may also qualify for deductions.
These small deductions add up — potentially lowering your effective tax rate by 1–2%.
Comparison: California vs. Other States
California has one of the highest top tax rates in the country. Here’s a quick comparison with other states in 2025:
- Texas: 0% (no state income tax)
- Florida: 0%
- Oregon: Up to 9.9%
- New York: Up to 10.9%
While high, California’s taxes support better infrastructure, healthcare access, and education systems than many states with no income tax. However, the high cost of living can make it challenging for middle-income earners.
To understand how state taxes fit with other financial obligations, check out our related article on How Do I Calculate Property Tax in California. Together, these two determine most of your annual tax expenses as a California resident.
Filing and Deadlines
The California state income tax filing deadline aligns with the federal deadline — usually April 15. You can file electronically via the FTB’s CalFile system or use any major tax software. If you can’t file on time, request an automatic 6-month extension, but remember that taxes owed are still due by April 15.
Tips to Reduce California Income Tax
- Contribute to retirement plans like 401(k) or IRA — these reduce taxable income.
- Track business deductions if you’re self-employed or a freelancer.
- Claim education credits if paying tuition or student loans.
- Donate to registered charities — you’ll get deductions and support a good cause.
- Move strategically within the state — cities with lower local taxes can slightly reduce your total.
Common Mistakes to Avoid
- Forgetting to include 1099 income from freelance or gig work.
- Claiming duplicate dependents or incorrect credits.
- Filing late without requesting an extension.
- Ignoring local income tax surcharges in certain districts.
Avoiding these mistakes can save you hundreds in penalties.
Effective Tax Rate vs. Marginal Rate
A common confusion is between your marginal tax rate (the rate on your last dollar earned) and your effective tax rate (the total tax divided by total income).
For example, earning $100,000 doesn’t mean you pay 9.3% on all of it — only the portion that falls into that bracket. Your effective rate might be closer to 6%.
California’s 2025 income tax system may seem complicated, but once you understand the brackets and deductions, it’s easy to estimate what you owe.
Always verify your bracket using the Franchise Tax Board’s official calculator and plan deductions early to save money. For a full picture of your tax responsibilities, combine this with our article on How Do I Calculate Property Tax in California. Staying informed means no surprises at tax time — and more money in your pocket.