Form FTB 3514 California Earned Income Tax Credit: Step-by-Step Instructions

To fill out California Form FTB 3514, work through only the parts that match your situation: every filer completes Parts I through V to claim the California Earned Income Tax Credit (CalEITC), then adds Part VII if you qualify for the Young Child Tax Credit (YCTC) and Part IX for the Foster Youth Tax Credit (FYTC). Part-year residents also complete the matching Parts VI, VIII, and X. Attach the finished form to your Form 540 or 540NR.¹

Confirm You Qualify Before You Start

CalEITC eligibility governs the whole form. If you don’t qualify for CalEITC, you can’t claim YCTC or FYTC either (with one narrow YCTC exception covered below). For the 2025 tax year, you must meet all of the following:²

You lived in California for more than half the year (at least 183 days).
You were at least 18 at the end of the year, or you have a qualifying child.
Your California earned income and your federal adjusted gross income were each less than $32,901.
Your investment income was $4,814 or less.
You are not filing federal Form 2555 (Foreign Earned Income).

Both SSNs and ITINs qualify. If you file married or RDP filing separately, you can still claim the credit only if you had a qualifying child who lived with you more than half the year, and you either lived apart from your spouse for the last six months or were legally separated under a written agreement or court decree.²

What to Gather First

Pull everything together before you start. Missing a document in the middle is the fastest way to misreport a figure that matters.

SSNs or ITINs for you, your spouse, and every qualifying child. If anyone did not have an SSN or ITIN by the return’s due date (including extensions), that person cannot be used for the credit, even if the number arrives later.³
Every W-2 showing California wages and tips.
Your completed federal return. You’ll need your federal AGI from Form 1040, line 11b, and your federal EIC amount from line 27a; both get entered in Part I.
Self-employment records: your federal Schedule C, Schedule F, Schedule SE, and any Schedule K-1. You’ll also need your business address, business license number (if any), state employer identification number (SEIN), and the six-digit business code from your federal schedule.
For each qualifying child: full name, date of birth, relationship, the number of days they lived with you in California, and their physical address during the year.
ITIN holders: keep identification documents (the same types accepted for a California driver’s license) and documents supporting your earned income. The FTB may ask for these after you file.
Foster youth filers: information about your foster care placement and county. The California Department of Social Services verifies eligibility.

Working Through the Form Part by Part

The 2025 form has ten parts. Full-year residents claiming CalEITC complete Parts I through V, then add Part VII (YCTC) or Part IX (FYTC) if applicable. Part-year residents filing Form 540NR also complete Parts VI, VIII, and X.¹

Part I: Qualifying Information

This part screens whether you can proceed. Report whether the IRS or FTB has ever disallowed your earned income credit, your federal AGI, and your federal EIC amount. Answering “yes” to a prior disallowance triggers the recertification steps in the instruction booklet (typically all seven steps) to re-establish eligibility.

Part II: Investment Income

Enter investment income following Step 2 in the booklet. If the total exceeds $4,814, stop. You cannot claim any credit on this form.³

Part III: Qualifying Child Information

Complete lines 5 through 12 for up to three qualifying children. For each child, enter name, SSN or ITIN, date of birth, student or disability status, relationship to you, and the number of days the child lived with you in California. The threshold is 183 days (184 in a leap year). If the child was born or died during the year and your home was the child’s home for more than half the time the child was alive, enter 365. Also enter the child’s physical address; if you moved within California during the year, use the principal residence you shared the longest.³

A qualifying child can be your son, daughter, stepchild, foster child, sibling, step-sibling, half-sibling, or a descendant of any of those (such as a grandchild, niece, or nephew). The child must be under 19 at year’s end, under 24 if a full-time student, or any age if permanently and totally disabled.

Part IV: California Earned Income

Report your actual California earned income on the appropriate lines: wages subject to California withholding, In-Home Supportive Services (IHSS) payments, prison inmate wages, nontaxable combat pay, and net business income or loss. The total on the final line drives the credit calculation in Part V.

Part V: California Earned Income Tax Credit

Calculate CalEITC using the worksheet in the instruction booklet and the EITC table, then transfer the result to Part V. The worksheet compares your California earned income to your federal AGI, looks up the credit from a table based on the number of qualifying children, and uses the smaller of the two credit amounts. The percentages built into the table are 7.65 percent with no qualifying children, 34 percent with one, 40 percent with two, and 45 percent with three or more.⁴

Part VII: Young Child Tax Credit

You qualify for YCTC if you meet CalEITC requirements and have at least one qualifying child who was younger than six on the last day of the tax year.⁵ One exception: if you would have qualified for CalEITC but your earned income was zero or negative, you can still claim YCTC provided your net losses did not exceed $35,640 and your wages did not exceed that same amount.⁶ If your California earned income is at or below the threshold, you receive the full amount; above it, the form walks you through subtracting the threshold, dividing by 100, and multiplying by a reduction factor to compute the phase-out.

Part IX: Foster Youth Tax Credit

FYTC is for former foster youth who were in California’s foster care system at age 13 or older. You must have been between 18 and 25 at the end of the tax year and must also qualify for CalEITC.⁷ If both you and your spouse each meet the foster care criteria, you can claim up to $2,378 combined. The phase-out works like YCTC: full credit at or below $27,425 of California earned income, with gradual reduction above that figure. Transfer the final amount to your Form 540 or 540NR.

Attaching and Submitting the Form

Attach the completed Form 3514 to your California income tax return: Form 540 if you’re a full-year resident, Form 540NR if you’re a part-year resident or nonresident.⁸

The FTB’s free CalFile system supports all three credits, and commercial tax software attaches Form 3514 automatically. Self-employed filers using CalFile must upload a PDF copy of their federal return at submission.⁹

If you mail your return, put Form 3514 behind your Form 540. Self-employed filers must also attach a copy of their complete federal return, including Schedules C, F, SE, and any K-1.³ Refund returns go to:¹⁰

Franchise Tax Board
PO Box 942840
Sacramento, CA 94240-0001

Mistakes That Get the Credit Denied

The FTB rejects CalEITC, YCTC, and FYTC claims more often than most filers expect. The issues that trip people up most often:³

Missing or late SSN/ITIN. If you, your spouse, or a qualifying child did not have the number by the filing deadline (including extensions), that person can’t count, even on an amended return filed after the number arrives.
Income over the limit. California earned income and federal AGI must each be below $32,901. Exceeding either disqualifies you.
Investment income above $4,814 makes you ineligible for all three credits.
Residency too short. If you (or your spouse on a joint return) were a California nonresident for half the year or more, you cannot claim the credit.
Wrong number of days for a qualifying child’s California residency on line 11, or forgetting temporary absences that count as time at home.
A prior IRS or FTB disallowance not addressed in Part I with the recertification steps.
Filing federal Form 2555 (Foreign Earned Income Exclusion) alongside your return.

Free Help If You Need It

If the form feels like a lot, free preparation is available. The IRS-administered Volunteer Income Tax Assistance (VITA) program provides basic return preparation at no cost for low-to-moderate-income taxpayers, and VITA preparers can handle CalEITC claims. Sites generally operate from February through mid-April; find one at irs.treasury.gov/freetaxprep.¹¹ CalFile is the other free route if you’re comfortable filing on your own.

1
Franchise Tax Board. 2025 Form 3514 California Earned Income Tax Credit
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Franchise Tax Board. Eligibility and Credit Information CalEITC
3
Franchise Tax Board. 2025 Instructions for Form FTB 3514 California Earned Income Tax Credit Booklet
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California Legislative Information. California Code RTC 17052
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Franchise Tax Board. Young Child Tax Credit
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California Legislative Information. California Code RTC 17052.1
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California Department of Social Services. Foster Youth Tax Credit
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Franchise Tax Board. California Earned Income Tax Credit
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Franchise Tax Board. CalFile Qualifications 2025
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Franchise Tax Board. 2025 Instructions for Form 540 California Resident Income Tax Return
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California State Controller’s Office. Volunteer Income Tax Assistance (VITA) Program