CA state tax return Schedule S: State postal code - California nonresident cannot claim other state tax credit

[extending]

Hi,

I moved from New York to California in October 2025 and became a part-year resident of California starting at that time. However, I continued to earn salary from New York during October–December 2025.

Since this income was taxed by New York, I attempted to claim the Other State Tax Credit on my California return to avoid double taxation. However, the Smart Check generated the following error:

“Schedule S: State postal code – California nonresident cannot claim other state tax credit...”

As a result, I am unable to e-file my return.

Could you please advise on how to resolve this issue? Thank you.

[MindyB]

You’re getting that error because the Other State Tax Credit (Schedule S) is only for full‑year California residents. As a part‑year resident, you should instead allocate your income between states so California only taxes the CA‑resident portion.

Here is how to fix this:

• Residency: In the CA interview, confirm “Part‑year resident” with your move date in 2025.
• W‑2 allocation: For NY‑sourced wages you earned after moving to CA:
  • Ensure your New York nonresident return (NY IT‑203) includes those post‑move wages as NY‑source, and
  • In the CA interview’s “Income Allocation” section, allocate wages by state and by residency period per the prompts. Do not force the Other State Tax Credit; remove it if present.
• Remove the OSCT entry: In California > Credits and payments > Other state tax credit, set it to No. That clears the Smart Check error.