22A - SPEC - HVAC CHILLER AND WATER PUMP

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Instructions for Form 590 Withholding Exemption Certificate References in these instructions are to the California Revenue and Taxation Code (R &TC) General Information • Payments to nonresidents for royalties from D Definitions Registered Domestic Partners (RDP) — For natural resources with activities in California. Nonresident includes all of the following: purposes of California income tax, references •Distributions of California source income to g' to a spouse, husband, or wife also refer to a Registered Domestic Partner (POP) unless otherwise specified. For more information on RDPs, get FTB Pub. 737, Tax Information for Registered Domestic Partners. A Purpose Use Form 590, Withholding Exemption Certificate, to certify an exemption from nonresident withholding. Form 590 does not apply to payments of backup withholding. For information on California backup withholding, go to ftb.ca.gov and search for backup withholding. Form 590 does not apply to payments for wages to employees. Wage withholding is administered by the California Employment Development Department (EDD). For more information, go to edd.ca.gov or call 888.745.3886. Do not use Form 590 to certify an exemption from withholding if you are a Seller of California real estate. Sellers of California real estate use Form 593 -C, Real Estate Withholding Certificate, to claim an exemption from real estate withholding. The following are excluded from withholding and completing this form: • The United States and any of its agencies or instrumentalities. • A state, a possession of the United States, the District of Columbia, or any of its political subdivisions or instrumentalities. • A foreign government or any of its political subdivisions, agencies, or instrumentalities. B Income Subject to Withholding California Revenue and Taxation Code (R &TC) Section 18662 requires withholding of income or franchise tax on payments of California source income made to nonresidents of California. Withholding is required on the following, but is not limited to: • Payments to nonresidents for services rendered in California. • Distributions of California source income made to domestic nonresident S corporation shareholders, partners, and members and allocations of California source income made to foreign partners and members. • Payments to nonresidents for rents if the payments are made in the course of the withholding agent's business. nonresident beneficiaries from an estate or trust. • Endorsement payments received for services performed in California. • Prizes and winnings received by nonresidents for contests in California. However, withholding is optional if the total payments of California source income are $1,500 or less during the calendar year. For more information on withholding get FTB Pub. 1017, Resident and Nonresident Withholding Guidelines. To get a withholding publication, see Additional Information. C Who Certifies this Form Form 590 is certified by the payee. California residents or entities exempt from the withholding requirement should complete Form 590 and submit it to the withholding agent. The withholding agent is then relieved of the withholding requirements if the agent relies in good faith on a completed and signed Form 590 unless notified by the Franchise Tax Board (FTB) that the form should not be relied upon. An incomplete certificate is invalid and the withholding agent should not accept it. If the withholding agent receives an incomplete certificate, the withholding agent is required to withhold tax on payments made to the payee until a valid certificate is received. In lieu of a completed certificate on the preprinted form, the withholding agent may accept as a substitute certificate a letter from the payee explaining why the payee is not subject to withholding. The letter must contain all the information required on the certificate in similar language, including the under penalty of perjury statement and the payee's taxpayer identification number. The withholding agent must retain a copy of the certificate or substitute for at least four years after the last payment to which the certificate applies, and provide it upon request to the FTB. For example, if an entertainer (or the entertainer's business entity) is paid for a performance, the entertainer's information must be provided. Do not submit the entertainer's agent or promoter information. The grantor of a grantor trust shall be treated as the payee for withholding purposes. Therefore, if the payee is a grantor trust and one or more of the grantors is a nonresident, withholding is required. If all of the grantors on the trust are residents, no withholding is required. Resident grantors can check the box on Form 590 labeled "Individuals — Certification of Residency." 22A -12 Individuals who are not residents of California. Corporations not qualified through the California Secretary of State (CA SOS) to do business in California or having no permanent place of business in California. Partnerships or limited liability companies (LLCs) with no permanent place of business in California. Any trust without a resident grantor, beneficiary, or trustee, or estates where the decedent was not a California resident. Foreign refers to non -U.S. For more information about determining resident status, get FTB Pub. 1031, Guidelines for Determining Resident Status. Military servicemembers have special rules for residency. For more information, get FTB Pub. 1032, Tax Information for Military Personnel. Permanent Place of Business: A corporation has a permanent place of business in California if it is organized and existing under the laws of California or if it is a foreign corporation qualified to transact Intrastate business by the CA SOS. A corporation that has not qualified to transact intrastate business (e.g., a corporation engaged exclusively in interstate commerce) will be considered as having a permanent place of business in California only if it maintains a permanent office in California that is permanently staffed by its employees. E Military Spouse Residency Relief Act (MSRRA) Generally, for tax purposes you are considered to maintain your existing residence or domicile. If a military servicemember and nonmilitary spouse have the same state of domicile, the MSRRA provides: • A spouse shall not be deemed to have lost a residence or domicile in any state solely by reason of being absent to be with the servicemember serving in compliance with military orders. • A spouse shall not be deemed to have acquired a residence or domicile in any other state solely by reason of being there to be with the servicemember serving in compliance with military orders. Domicile is defined as the one place: • Where you maintain a true, fixed, and permanent home. • To which you intend to return whenever you are absent, Form 590 Instructions 2013 Page 1