Updated October 5, 2026. Quick answer: Yes. California follows the federal treatment: “treatment of pension and annuity income is generally the same” as the federal one, and the 2025 rate schedule for a single filer runs from 1.00% to 12.30%. There is no general retirement-income exclusion.
More state retirement-income schedules, line by line: California Schedule CA (540) pension lines.
How California treats annuity income
| Item | What the documents say |
|---|---|
| Treatment | Taxed as income, generally as the federal return reports it; no general exclusion |
| 2025 rates (single, Schedule X) | 1.00% on the first slice of taxable income up to 12.30% on taxable income over 742,953 |
| Military exclusion | Up to $20,000 of uniformed-services retirement pay or Department of Defense Survivor Benefit Plan annuity payments, before January 1, 2030 (not commercial annuities) |
| Non-qualified annuities | Pub. 1005 does not separately address them |
A $24,000 example
The tax on $24,000 of taxable annuity payments depends on the bracket they land in. Taxed wholly at 1.00% they would add $240; taxed wholly at 12.30%, $2,952. Your own figure depends on the rest of your income.
What changes in 2026
The 2025 booklet is the latest California document read, and it prints no 2026 rate schedule.
Federal rules
The state’s treatment sits on top of the federal one. The IRS explains the federal side in Topic no. 410, Pensions and Annuities and Publication 575, Pension and Annuity Income.
Related: whether California taxes pensions, how California taxes retirement income, annuity income tax by state, how a surrendered annuity is taxed, and pension and annuity decisions.
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Answer againSources
- Pension and Annuity Guidelines, FTB Publication 1005 (California Franchise Tax Board): https://www.ftb.ca.gov/forms/2025/2025-1005-publication.pdf
- 2025 Personal Income Tax Booklet (California Franchise Tax Board): https://www.ftb.ca.gov/forms/2025/2025-540-booklet.html
Sources: the primary documents linked above, read on October 5, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.