Hi, I am a military spouse and I just wanted to ask a few questions because these specific tax issues are uncommon. My spouse is active duty military with a SLR of FL and currently stationed in CA. We live together and work in CA. We filed as FL residents under the provisions of the VTBA/MSRRA and did not pay CA taxes in 2022. Last year we filed as "married filing jointly," but we could benefit from changing our filing status to "married filing separately" this year.
1) If we switch to "married filing separately" this year, can I still file taxes as a FL resident under the provisions of the VTBA/MSRRA as a military spouse? Are there any changes that have to be noted on the return to ensure that this is done correctly?
2) My spouse (military) started earning 1099 income for a side hustle in 2023. My understanding is that CA state taxes will be owed on that 1099 income this year (but NOT on the military W2 income). Is that correct?
3) If we open a solo 401K, can my spouse shelter some of that 1099 income from CA taxes with pre-tax contributions?
4) Are capital gains/dividends/interest subject to CA state taxes in our situation?
Thank you for your help.
