@ComplicatedTaxSituation , yes I understand that you are having a somewhat complicated situation cause by both needing to exclude your foreign earned income from federal taxes but also being qualified for the health insurance.
What you appear not to have considered is that once you ( Husband ) have left California , you are NOT a tax resident of California. Thus it is perhaps better for you to file MFJ for federal and MFS for California ( California allows residents to be considered non-resident for up to three years I think ). I suggest this because ACA and /or health insurance requirement is not applicable when you are outside the country. So the applicable MAGI should only be her income and health coverage is only for her.
This is what I find from FTB California:
"
Exception
If you file a joint return for federal purposes, you may file separately for California if either spouse was one of the following:
- An active member of the United States armed forces or any auxiliary military branch during the year
- A nonresident for the entire year and had no income from California sources during the year
Filing requirement
Visit Resident, Part-year resident and Nonresident taxation or Military for your filing requirement.
Perhaps your wife may call the FTB and get better guidance -- I think this may not be applicable for 2024 but should apply for 2025 on wards.
And yes , to be able to take advantage of FEIE, you will have to meet the 330 Days abroad ( note flying over international waters does not count as part of the 330 days. So have to be careful.
Is there more I can do for you ?
