How to Fill Out and Submit California FTB Form 589: Parts, Timing, Refund

California FTB Form 589, the Nonresident Reduced Withholding Request, lets a nonresident ask the Franchise Tax Board to lower the standard 7 percent withholding on California-source payments by netting allowable expenses against the gross amount. You complete four parts covering the payer, yourself, the type of income, and the expense math, then file the form with the FTB before any payment is made. If approved, both you and the payer receive a written notice stating the reduced withholding figure.¹

When Form 589 Is the Right Form

California withholding agents must withhold 7 percent of gross payments to a nonresident once total payments cross $1,500 in a calendar year.² Because the 7 percent is calculated on gross, nonresidents whose expenses eat into the payment often end up overwithheld. A performer paid $50,000 for a California engagement who spends $20,000 on travel, crew, and equipment would see $3,500 withheld at the standard rate; an approved Form 589 could bring that down to roughly $2,100.

Form 589 is for nonresidents who will owe some California tax but want the withholding tied to net income. If you qualify for a full exemption (you are a California resident, a tax-exempt organization, a California estate or trust, or a corporation doing business in the state), the right form is Form 590, which you give directly to the payer with no FTB review.³ If you are a nonresident seeking a complete waiver rather than a reduction, that is Form 588, except that foreign (non-U.S.) partners cannot use Form 588 and must use Form 589 instead.¹

Withholding does not apply at all to payments for goods, wages paid to employees (those run through EDD), services performed entirely outside California, payments to banks, or income from intangibles unless the property has a business situs in the state.² If your situation falls in one of those buckets, no reduction request is needed.

Completing the Four Parts

The current form and electronic filing portal are on the FTB website.⁴

Part I: Withholding Agent Information

Enter the name, address, and taxpayer identification number of whoever will be paying you — the client, venue, or production company that issues the check. Give either the business information or the individual’s information, not both, and check the box showing whether the TIN is an FEIN or an SSN.¹

Part II: Payee Information

This is your information. Use your legal name exactly as it appears in IRS or California Secretary of State records, along with your mailing address and TIN. Individuals use an SSN or ITIN; business entities use their FEIN. Again, enter either business or individual information, never both.¹

Part III: Type of Income

Check a single box identifying the kind of California-source payment at issue: compensation for personal services, rents, royalties, or allocations to foreign nonresident partners or members. Foreign partners receiving effectively connected taxable income check the box for allocations to foreign nonresident partners/members.¹

Part IV: Withholding Computation

Put the total gross California-source payment on line 1, then itemize your direct expenses on lines 2 through 11. The form provides these categories:

Advertising
Commissions and fees
Cost of labor
Insurance
Legal, professional, and management fees
Rent or lease costs
Supplies
Travel, meals, and entertainment
Other expenses

Subtract total expenses from the gross to get the net California-source payment on line 13, then multiply by 7 percent. The product on line 14 is the reduced withholding amount you are asking the FTB to approve.¹

What You Can and Cannot Deduct

Total expenses are capped at 50 percent of the gross California-source payment. The form will not let you deduct more than half the gross, even if your actual costs run higher. The only exception is for foreign (non-U.S.) partners, who are not subject to the 50 percent limit.¹

Only direct expenses you personally incur to perform the California services count. The following are specifically disallowed:

Depreciation on equipment and the principal portion of mortgage payments
Costs paid by a booking agent, venue, or other third party on your behalf
Capital purchases — equipment, furniture, replacements, and permanent improvements to property
Personal and family living expenses unrelated to the engagement
Charitable contributions, fines, and penalties paid to any government agency

Keep the receipts, contracts, and backup for every number you enter. The FTB may ask for documentation before approving the reduction.¹

Where to Send It and How Much Lead Time You Need

File Form 589 with the FTB, not with the withholding agent, and file it before you receive payment. If payment goes out first, the agent is required to withhold the full 7 percent because there is no approval letter in hand.¹

Two ways to submit:

Online through the FTB website. Allow at least 10 business days for processing. If you need to send supporting documents (such as federal Form 8804-C or an expense breakdown), fax them to 916-855-5743 along with your name, taxpayer ID, and the electronic confirmation number from your submission.⁴
By mail to Withholding Services and Compliance MS F182, Franchise Tax Board, PO Box 942867, Sacramento CA 94267-0651, or by fax to 916-855-5743. Allow 21 business days for processing.¹

If services are coming up next month and you want the reduction applied to the first payment, file online now rather than waiting on mail.

What You Get Back

The FTB reviews the request and issues a Withholding Determination Notice to both you and the withholding agent, stating the approved amount for your California-source income. Filing does not guarantee the figure you proposed. The FTB can approve a smaller reduction than you asked for, or deny the request if the expenses are not adequately supported.¹

Once the notice issues, the withholding agent uses the approved amount instead of the standard 7 percent and keeps the notice on file for a minimum of five years in case the FTB asks for it.¹

Foreign Partner Specifics

Foreign (non-U.S.) partners or members of a partnership earning effectively connected taxable income from California sources use Form 589 to reduce or eliminate withholding on their share. The 50 percent expense cap does not apply. A foreign partner must attach a completed and signed federal Form 8804-C with documentation of California expenses, and must enter the total California amounts from Form 8804-C, lines 8a through 8f, on Form 589, line 10. The FTB allows 21 business days to process these requests.¹

1
Franchise Tax Board. 2026 Instructions for Form 589 Nonresident Reduced Withholding Request
2
Franchise Tax Board. FTB Publication 1017
3
Franchise Tax Board. Withholding on Nonresidents
4
Franchise Tax Board. Form 589 Nonresident Reduced Withholding Request