April Tax Collections Reach $1.7 Billion

During the first nine days of April, California took in a net $1.7 billion of tax receipts, dominated by $1.8 billion of personal income tax receipts ("net" totals refers to total reciepts minus refunds paid out to taxpayers).  So far this month, sales tax refunds have outpaced tax receipts, but that performance is expected to change before month-end.

For April as a whole, personal income tax receipts will be the dominant force, accounting for more than 80% of the state’s total tax receipts as individuals file their final returns and make their estimated tax payments.

Afternoon Revenue Update

Today the Franchise Tax Board is expected to bring in its highest level of daily income so far for the month: $197 million. However, due to refunds issued for personal income, the day is expected to total $120.7 million, raising the monthly total to $1.49 billion. This will help with the month-end total, especially when the expected surge of revenues comes in next week during the 16th and 17th.

Year-to-Date Revenues Top Projections by $1.5 billion

California banked $1.5 billion more than expected at the end of the first week of April. For the period July 1, 2013 through April 8, the State’s “Big Three” revenue sources -- personal income, corporate, and sales taxes -- generated $65.0 billion versus the $63.5 billion that was predicted based on the Governor’s Budget released in January.

Personal income taxes accounted for the bulk of the positive variance, with a margin of $1.03 billion, or 102%, of the forecast. Corporate taxes beat estimates by about $550 million and were 14% ahead of estimates. Only retail sales taxes fell short of estimates, although the miss was a relatively small $80 million, or 0.5%.

Capital gains, earned primarily by wealthier Californians, are helping to fuel the State’s personal income tax receipts. Not so long ago, high-income taxpayers were required to make payments on a certain steady basis throughout the year. During the State’s cash shortages during the last 10 years, the payment schedule accelerated. The Franchise Tax Board advises taxpayers with the following: California differs from federal law. To avoid an estimate penalty, taxpayers must pay at least 30 percent by April 15 and 40 percent by June 16 of this year and 30 percent by January 15, 2015.

Perspective on March Revenue Numbers

Controller John Chiang today released his monthly report covering California's cash balance, receipts and disbursements in March 2014. Revenues for the month totaled $6.4 billion, surpassing estimates in the 2014-15 Governor’s Budget by $470.9 million, or 7.9 percent. Read the news release and related analysis: http://bit.ly/1k4eol0

April 15 A Week Away

Californians have one week to complete their tax returns, but some of the early (earlier) birds have already paid.  Between Monday and today, Tuesday, April 8, the Franchise Tax Board has collected somewhere around $300 million in personal income tax receipts according to preliminary figures.   Including the revenues from withholding for individuals and netting out refunds, the two-day take has been about $680 million.  This is about $100 million more than was collected during the comparable two-day period last year.

California Consumers Out Shopping

Although the Passover and Easter holidays are a week and two weeks away, respectively, Californians are shopping and adding to California’s tax collections.  Retail sales tax collections for April 7 and 8, which also included the weekend, totaled $26.5 million.  This dwarfed the $11.2 million received a year ago, when Easter and Passover occurred at the end of March.  Typically, retail sales tax receipts -- excluding major consumer durable goods -- account for about one-third of sales tax collections.

April Tax Receipts Reach $1.3 Billion in First Week

Final numbers are in for California’s tax take on its three major revenue sources for the first week of April though Monday, the 7th, and the numbers look positive.  The first week total was $1.3 billion, which is about 10.2% of the total expected for the month as a whole. This is identical to the proportion reached in the comparable first tax reporting week of April 2013.

Corporate taxes are at 9.8% of their monthly target. While retail sales refunds so far have exceeded tax payments, personal income tax receipts are already at 13.3% of their monthly goal. The heavy inflows of personal tax payments should come around the middle of the month.

Nearly two-thirds of every dollar deposited in the General Fund comes from the Personal Income Tax (PIT).  Individuals pay the bulk of this tax, but certain partnerships and closely held companies may also opt into the income tax system.  These partnerships and S-corporations account for less than 10 percent of the total PIT collections.