Updated October 24, 2026. Quick answer: Lines 43 to 45 of California Form 540 are for additional special credits. The booklet says “A code identifies each credit.” and that more than two credits go on Schedule P (540), Part III. This page covers two of them, the Credit for Senior Head of Household (code 163) and the Credit for Dependent Parent (code 173).
What this line does
The booklet’s instruction is headed “Additional Special Credits” for lines 43 through 45. It says “A code identifies each credit. To claim only one or two credits, enter the credit name, code, and amount of the credit on line 43 and line 44.” The form’s part is headed “Special Credits” and line 43 and line 44 sit on the page headed “Side 2 Form 540 2025”, with line 45 on the page headed “Form 540 2025 Side 3”.
Line 45 on the form reads “To claim more than two credits, see instructions. Attach Schedule P (540).”. The booklet also explains the credit chart: “The Credit Chart included in this booklet describes the credits and provides the name, credit code, and number of the required form or schedule.”
The whole line sequence is on California Form 540 line by line.
Who it applies to
The Credit for Senior Head of Household reads “You may claim this credit if you:” and lists the age, the earlier head of household year and the AGI limit shown in the table below. The Credit for Dependent Parent opens with a filing status warning: “You may not claim this credit if you used the single, head of household, qualifying surviving spouse/RDP, or married/RDP filing jointly filing status.”
The booklet adds a rule for two of the credits: “If you qualify for the Credit for Joint Custody Head of Household and the Credit for Dependent Parent, claim only one.” It continues “Select the credit that will allow the maximum benefit.”
What the instructions say
| Line | What the form says |
|---|---|
| Claiming one or two credits | “A code identifies each credit. To claim only one or two credits, enter the credit name, code, and amount of the credit on line 43 and line 44.” |
| Claiming more than two | “To claim more than two credits, use Schedule P (540), Part III.” |
| Form, line 45 | “To claim more than two credits, see instructions. Attach Schedule P (540).” |
| Attachments | “Important: Attach Schedule P (540) and any supporting schedules or statements to your Form 540.” |
| Carryovers | “If you claim a credit with carryover provisions and the amount of the credit available this year exceeds your tax, carry over any excess credit to future years until the credit is used (unless the carryover period is a fixed number of years).” |
| Expired credit carryover | “If you claim a credit carryover for an expired credit, use form FTB 3540, Credit Carryover and Recapture Summary, to figure the amount of the credit.” “Otherwise, enter the amount of the credit on Schedule P (540), Part III, and do not attach form FTB 3540.” |
| Dependent Parent, filing status | “You may not claim this credit if you used the single, head of household, qualifying surviving spouse/RDP, or married/RDP filing jointly filing status.” |
| Dependent Parent, all must apply | “Claim this credit only if all of the following apply:” |
| Dependent Parent, bullet 1 | “You were married/or an RDP at the end of 2025 and you used the married/RDP filing separately filing status.” |
| Dependent Parent, bullet 2 | “Your spouse/RDP was not a member of your household during the last six months of the year.” |
| Dependent Parent, bullet 3 | “You furnished over one-half the household expenses for your dependent mother’s or father’s home, whether or not she or he lived in your home.” |
| Dependent Parent, amount | “To figure the amount of this credit, use the worksheet for the Credit for Joint Custody Head of Household within this line instructions.” “If you qualify for the Credit for Joint Custody Head of Household and the Credit for Dependent Parent, claim only one.” |
| Senior Head of Household, lead | “You may claim this credit if you:” |
| Senior Head of Household, bullet 1 | “Were 65 years of age or older on December 31, 2025” |
| Senior Head of Household, bullet 2 | “Qualified as a head of household in 2023 or 2024 by providing a household for a qualifying individual who died during 2023 or 2024.” |
| Senior Head of Household, bullet 3 | “Did not have AGI over $98,652 for 2025.” |
| Senior Head of Household, birthday note | “If your 65th birthday is on January 1, 2026, you are considered to be age 65 on December 31, 2025” |
| Senior Head of Household, filing status | “If you meet all the conditions listed for this credit, you do not need to qualify to use the head of household filing status for 2025 in order to claim this credit.” |
| Senior Head of Household, worksheet | “Use this worksheet to figure this credit using whole dollars only.” |
| Worksheet line 1 | “Enter the amount from Form 540, line 19” |
| Worksheet line 2 | The line is labelled “Credit percentage” and prints 2% |
| Worksheet line 3 | “Credit amount. Multiply line 1 by line 2. Enter the result or $1,860, whichever is less.” |
The figures the form prints
Three figures sit inside single lines. The AGI condition for the senior credit is “Did not have AGI over $98,652 for 2025.”. The worksheet’s line 3 is “Credit amount. Multiply line 1 by line 2. Enter the result or $1,860, whichever is less.” and its line 2 carries the 2% credit percentage, as the table shows.
The Dependent Parent credit prints no dollar figure of its own in its paragraph; it points to the worksheet named in the table above.
Where the result goes next
The credit amounts on lines 43 to 45 join the other credit lines. The form’s line 47 reads “Add line 40 through line 46. These are your total credits”, and line 48 reads “Subtract line 47 from line 35. If less than zero, enter -0-”. The senior credit worksheet starts from line 19, covered on California Form 540 line 19.
For related background see California retirement taxes, property tax breaks for seniors in California and Form 1040-SR.
A worked example
This is an illustration, not a state example. The line 19 amounts are invented for the computation and the age and AGI conditions in the list above are separate tests that this example does not apply. It only follows the worksheet arithmetic: 2% of line 19, or the printed cap, whichever is less.
| Case | Calculation | Result |
|---|---|---|
| Example 1 | Invented line 19 amount | $40,000 (invented, for the computation) |
| 40,000 times 2% (line 3, first quantity) | $800 (computed) | |
| Smaller of $800 or $1,860 (line 3) | $800 (computed) | |
| Example 2 | Invented line 19 amount | $95,000 (invented, for the computation) |
| 95,000 times 2% (line 3, first quantity) | $1,900 (computed) | |
| Smaller of $1,900 or $1,860 (line 3) | $1,860 (computed) |
In the first case the 2% amount is below the cap, so the worksheet gives $800. In the second case the 2% amount is above the cap, so the worksheet gives $1,860. Your own line 19 comes from your own return.
Edition and line numbers
This page reads the California 540 Forms and Instructions, 2025 Personal Income Tax Booklet, and Form 540, California Resident Income Tax Return (2025), for tax year 2025, the current file the Franchise Tax Board served on 2026-10-24. Check the edition printed on your own form and use that edition’s line numbers.
Common mistakes
- Using the Dependent Parent credit with the wrong filing status. The booklet says “You may not claim this credit if you used the single, head of household, qualifying surviving spouse/RDP, or married/RDP filing jointly filing status.”
- Claiming more than two credits directly on lines 43 and 44. The booklet says “To claim more than two credits, use Schedule P (540), Part III.”
- Overlooking the January 1 birthday footnote for the senior credit. The booklet says “If your 65th birthday is on January 1, 2026, you are considered to be age 65 on December 31, 2025”
Related: California retirement taxes, property tax breaks for seniors in California, Form 1040-SR, and California tax brackets.
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Answer againSources
- California 540 Forms and Instructions, 2025 Personal Income Tax Booklet, Franchise Tax Board: www.ftb.ca.gov
- Form 540, California Resident Income Tax Return (2025), Franchise Tax Board: www.ftb.ca.gov
- Related official page (not quoted): Franchise Tax Board, 2025 Personal Income Tax Booklet page: www.ftb.ca.gov
Read from the state revenue documents linked above on October 24, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the state revenue department is the right place to confirm anything consequential.