State Income Tax Collections $5 Billion Above Estimates in January

Income tax collections by the state in January – estimated payments by individuals and withholding done by employers totaled $12.7 billion — $5 billion over the Brown’s administration’s estimates, the Legislative Analyst said February 1.

While the analyst noted that more revenues now could mean less later – particularly in April, the highest collection month of the year — the unexpected cash may just be more cash than expected.

“Given the magnitude of the January revenue boost, it is also likely that a portion of it is attributable to 2012 taxable income simply being greater than previously projected,” the analyst writes.

Withholding collected for the month was $5 billion, 12 percent higher than predicted by Gov. Jerry Brown’s Department of Finance.

Other state income tax collections – mainly estimated payments — were 137 percent above estimates for the month.

More time is needed to figure out what’s going on, the analyst concludes.

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