You are California residents. Since you are stationed in California, you are not considered to live in Texas. For Active Duty Armed Forces members and their Military Spouses covered by MSRRA (which is your case), you are only taxed by your SLR, which is California. You must answer no to the questions if you lived in another state other than California or if you worked in another state other than Californai. Good news is that California no longer taxes Active Duty income for the Military Members stationed outside of California. However, the non-Active Duty income of the spouse is still taxed by California.
As a tax strategy going forward, you can try to see how to establish Texas as your SLR while you are stationed there. If you are able to do so, then neither will be taxed on income if you are stationed in other states because Texas has no state income tax at all. You do have to have a justifiable reason to change your SLR, but it can be applied for by using DD Form 2058. Here is an FAQ with more informaiton: https://ttlc.intuit.com/replies/3302301
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
