Taxpayers that have a simple tax return don’t need to file the rather more complicated Form 540. It’s most suitable for taxpayers that have income from a single source other than self-employment, such as working for an employer, and claim the standard deduction and somewhat simple tax credits. Everything about Form 520-2EZ is extremely simple, hence the name – too easy.
Other than filling it out, the requirements for Form 540-2EZ are the same as the 540. You fill it out and mail it to the same address. The Franchise Tax Board accepts all the state income tax returns to the same address, whether you mail them with or without payment.
Requirements for filing 540-2EZ
There are certain requirements that taxpayers must meet in order to file 540-2EZ instead of 540. These are as follows.
You have taxable income coming from the following sources.
- Employment (wages, salaries, and tips)
- Taxable fellowship grants and scholarships. However, only if these are reported on a Form W-2.
- Interest and dividends
- Capital gains from mutual funds
- Social Security benefits
- Paid family leave insurance
- Railroad retirement payments (Tier 1 and 2)
Your total income can’t exceed $100,000 if filing as single or head of household. If you’re married/RPD filiing a joint return or filing as a qualifying widow(er), this figure is doubled.
On your return, you can’t itemize deductions and must take the standard deduction, make no adjustments to income, have taxes withheld through W-2s and 1099-Rs, so 1099-MISC or NEC doesn’t count as it means you had self-employment income.
Additionally, you can only claim the personal exemption, a maximum of three dependent exemptions, and senior exemption. As for the credits, you can only claim the refundable California EITC, refundable Young Child Tax Credit, and the nonrefundable renter’s credit.
If you’re eligible for any other tax credit or your itemized deductions are more than what you can deduct with the standard deduction, use Form 540 instead of the 540-2EZ version.
File Form 540-2EZ Online PDF
If you’re eligible for the tax form, you can start filing the tax form online and print out a paper copy to later send to the Franchise Tax Board. Once complete, you can then send it to the below address with or without payment.
With payment, mail Form 540-2EZ to:
Franchise Tax Board
PO Box 942867
Sacramento CA 94267-0001
Without payment, mail Form 540-2EZ to:
Franchise Tax Board
PO Box 942840
Sacramento CA 94240-0001