For the year 2020, I am working in the state of Washington and my wife is working in California. How will the state taxes work for us as a couple?

[mprTaxes]

For the year 2020, I am working in the state of Washington and my wife is working in California. How will the state taxes work for us as a couple?

[Anonymous]

what is your state of domicile?

Your domicile is the place where you maintain a permanent home. Your intent to remain in this place indefinitely makes it your domicile and makes you the place's domiciliary. Your domiciliary status subjects you to specific laws. Thus, domicile is a legal construct used to determine where you vote, file lawsuits, pay taxes, claim benefits, and oblige governmental authority.

if you both domicile in California you will pay taxes on all your income. Washington does not have a personal income tax.

what if each of you has domicile in a different state. then your spouse will file a California return reporting only her separate income.  make sure that the w-2's issued show the proper home address. if you just use one address, say California, expect a notice challenging the exclusion of the "out of state income" 

I assuming that your spouse is an employee in Washington. while it has no personal income tax, for people engaged in their own business it does have a business and occupation tax. 

[Hal_Al]

As a California resident, you will have to pay CA income tax on your income earned in WA.  

The general rule is: your report all your income on your home state return, even the income earned out of state. You file a non-resident state return for the state you worked in and pay tax to that state. Your home state will give you a credit, or partial credit, for what you paid the non-resident state. 

Since WA does not have an income tax, you do not have a non-resident return to file. But you still have to pay tax on that income to your home state.

[mprTaxes]

I am not living in CA but in WA, only my wife is living in CA....I am on H1B so no domicile state

[Hal_Al]

It depends on how solid your claim of WA residency is. States will usually consider you a resident if you have  a family domicile in that state, that you return to, even if you have a 2^nd domicile where you work. See https://www.ftb.ca.gov/forms/2019/2019-1031-publication.pdf

CA generally requires the same filing status to be used for both federal and state returns unless one spouse is a full year nonresident AND that spouse does not have any CA source income.  If the nonresident spouse is allocated CA-source income from the resident spouse due to community property law, the couple will NOT meet the exception for filing MFS for CA when MFJ is used for federal.

Reference: https://ttlc.intuit.com/community/state-taxes/discussion/re-married-couples-work-and-live-in-differe...

[Sam Hopi]

Hi, 

Question: My  SPOUSE lived in CA with a w-2 from CA and moved  to Texas around middle of June,  has a W-2 from there as you know Texas dose not have state withhold, also has Texas DRIVER LICENSE and rented a condo lives there FOR 4 YEARS medical RESIDENCY.

I lived with my 2 Childs  all the year in CA. 

Can I consider W-2 of TX for income CA? If it is, how about employer number? Surely has to pay tax to CA.

1-What is the status filing of us for tax filing?

2- or what is the status of my spouse in WA for tax filing?

3- and what is the status of me with son in CA? 

Thanks for your help.

[PattiF]

All of this information can be entered in the beginning section of your return in the My Info Section. 

You and your dependents would be residents of California, your spouse would be a part-year resident in California and a Part-year resident in Texas. 

The California tax law states that:

If you lived inside or outside of California during the tax year, you may be a part-year resident.

As a part-year resident, you pay tax on:

• All worldwide income received while a California resident
• Income from California sources while you were a nonresident

Your spouse would not need to pay tax to California for the Texas income.

Did someone live in WA as mentioned in number 2?

@Sam Hopi 

[Sam Hopi]

Thanks but this is not my answer. Please read my question again. I told about TX W-2 if it is not taxable for CA you mean it is nothing but this should go on FED part and automatically added to family return, CA???????? Think about that .

You said: Your spouse would not need to pay tax to California for the Texas income. So I am asking should I take it away? 

Based on my explanation help me to how file my return? HOH, Married Sep, Married Join...... for all of us.

How can I practically mention allocation income on return.

[AliciaP1]

As @PattiF posted, you should be entering the states each of you (you, your wife, and dependents) lived in according to what actually happened.  If your wife lived in CA and TX you will enter that she did not reside in CA all year and TurboTax will ask you to add the other state she lived in.  When you complete the CA return, the interview will ask you to apportion the income listed on your Fed return (which will be all income earned in CA or TX) to the amount earned in while residing in CA.

If you were married on 12/31/22, you can only file Married Filing Joint or Married Filing Separately. See What is my tax filing status (single, married, etc.)? for help in making your decision on how to file.

@Sam Hopi 

[Sam Hopi]

I am confused. Practically it is hard to do it.  In the tax return what is my son and me's filing status and what is my wife's status. Can I consider we are resident in CA  and my wife part resident of CA? I do not believe that software does have an area to enter for my wife partially resident (part-resident) and for us as full resident. If you know could please help me to find that area.

[JamesG1]

You will be filing a married filing jointly tax return.  Your son will be a dependent on your tax return.  Does your son have income that needs to be reported?  Does your son need to file his own tax return?

You and your son will be residents of California.  Your spouse will be a part-year resident of California and a part-year resident of Texas.  The screen Residency Information During 2022 in the California state income tax return will clarify your status.

At the screen Tell us about your California income, you will enter how much was earned living in California.

@Sam Hopi 

[TomD8]

@Sam Hopi --

Go back to the My Info section at the beginning of TurboTax.

Enter your State of Residence as CA.

Enter your wife's State of Residence as TX.  Indicate that she lived in another state during the year, and enter CA as that state.  Enter the date she moved to TX.

It's normally best to use Married Filing Joint as your Filing Status.  (Since your wife was a part-year resident of CA, you can't file your CA return as Married Filing Separately.)

https://www.ftb.ca.gov/file/personal/filing-status/married-rdp-filing-jointly.html

When you enter your wife's income information, allocate to CA only the portion of her income that she earned while she was still a CA resident.