@AmyC Sorry maybe you didn't consider the part about how I am separated from my spouse? What you cited only applies to married couples / RDP who live together and are not separated. So Married/RDP filing separately | FTB.ca.gov does not apply in my case. If the couple is separated all year, and the couple meets the four IRS "living apart" conditions, an individual spouses earned income is separate property. Also, if you do NOT meet ALL four conditions, you must follow the community property laws of the state you live. Which in California, all earned income is separate property starting the date of separation (July 2020 for me).
IRS Publication 504 (2021), Divorced or Separated Individuals reads:
If you and your spouse are separated but don’t meet the four conditions discussed earlier under Spouses living apart all year, you must treat your income according to the laws of your state. In some states, income earned after separation but before a decree of divorce continues to be community income. In other states, it is separate income.
The Four "Spouses living apart all year" conditions:
You and your spouse lived apart all year. --I cohabitated with my spouse a couple months in 2022.--
You and your spouse didn’t file a joint return for a tax year beginning or ending in the calendar year.
You and/or your spouse had earned income for the calendar year that is community income. --By California's definition, neither me nor my spouse had community earned income because we were separated. SEE CALIFORNIA FAMILY CODE SECTION 771.--
You and your spouse haven’t transferred, directly or indirectly, any of the earned income in (3) between yourselves before the end of the year. Don’t take into account transfers satisfying child support obligations or transfers of very small amounts or value.
Section 771 of the California Family Code reads:
(a) The earnings and accumulations of a spouse and the minor children living with, or in the custody of, the spouse, after the date of separation of the spouses, are the separate property of the spouse.
