TomD8
Level 15

State tax filing

CA and AZ are "reverse credit" states.  This means that a CA resident who has income taxed by both AZ and CA would claim the "other state credit" on his non-resident AZ return, not on his home state CA return.

 

Note that Section C of this CA tax reference specifically excludes AZ from the list of states for which CA residents can claim an other-state credit: https://www.ftb.ca.gov/forms/2022/2022-540-s-instructions.html

 

CA residents in this situation should therefore complete their resident CA return before doing their non-resident AZ return.

 

(Normally the "other state credit" is granted by the resident state; hence the term "reverse credit" in this situation.)

**Answers are correct to the best of my ability but do not constitute tax or legal advice.