Yes. The easiest way to complete these returns is to use a TurboTax Desktop version which allows up to five different returns to be created.
Question 1: Yes, your understanding is correct. For the income adjustment for community property in your scenario you would have a plus $10K adjustment and your spouse would have a minus $10K adjustment. Then on your separate CA returns you would be nonresident CA and allocate only the income earned while in CA to CA. CA will use your total income from your federal return, as adjusted for community property, as part of a ratio to determine your CA tax on CA source income. The other part of the ratio is the CA allocated amount that you enter. TurboTax will make those calculations for you based on your entries.
As you mention your wife's resident return would be pretty straightforward. Your wife would be CA resident and include all of her income her CA separate return.
Yes, you are correct MN does not have a mechanism for a community property adjustment. For your MN return. You will need to create a "Mock" federal married filing separate return that only has your income in it with no community property adjustment. You will not file that "Mock" federal return but use it to complete your Married Filing Separate MN resident return. You will need to print/mail that MN resident return.
You wife will not have a MN filing requirement since she had no MN source income.
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