Multiple states and tax filing

Forum|Forum|5 years ago
March 14, 2021
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My student son goes to school in Philadelphia and works part time and pays local Pennsylvania taxes, and he also interned in NYC and got a significant NY state tax withheld. Since he is being claimed as a dependent by his parents and being a student living outside CA, Turbo tax is asking him to file CA taxes and pay taxes in CA as a resident when he has earned nothing from working in CA. How should we handle this situation? Thank you

TomD8

Alumni - Champ

If your son's primary, main home is in CA, and he is in PA or NY on a temporary or transient basis (for example, in order to attend school), then he remains a resident of CA for tax purposes and ALL his income is taxable by CA, regardless of its source. A CA resident who leaves the state on a temporary or transient basis remains a resident of CA for tax purposes.

He can also be taxed as a non-resident by NY and PA for income earned within those two states, but CA will allow him to claim a credit for the taxes paid to those states, so he won't be double-taxed.

In order for the credit to be calculated and applied properly, he must complete his non-resident state tax returns before he does his home state CA return.

If he qualifies (by IRS criteria) to be claimed as your dependent, be sure he indicates on his own tax returns that someone else can claim him.

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