The answer to your question is yes; you will need to file tax returns in both California and Oregon.
As
a California resident, you will have to report (and thus pay tax
upon) all of your income, no matter where it was earned. In Oregon, you will have to pay Oregon income taxes on your Oregon-source income, as a nonresident taxpayer.
Naturally, this results in a situation where the same dollar of income is potentially taxed by both California and Oregon, which is sometimes called "double-taxed" income.
Fortunately,
there is some relief to be had here, by claiming an income tax
credit for taxes paid to another state on this mutually-taxed income.
Now
then, Oregon and California have a "special" relationship
agreement when it comes to interstate taxation. While TurboTax can certainly
compute
this tax situation correctly, it can be tricky.
One word of advice in
TurboTax, mechanically speaking, is that you should do the federal tax
return first, the Oregon nonresident return second, and then the California
resident return third (in that particular order) to ensure that the
state tax credits flow through the program correctly.
You can safely ignore the state of Washington, however, as it has no personal income tax system, and thus does not factor into this answer. In other words, while you will need to file federal, California, and Oregon personal income tax returns, you will not need to file a similar personal tax return in Washington.
Thank you for asking this important question.
