Job in CA, worked remotely for 5 weeks in Hawaii

[Becca22]

I have a job in CA, and worked remotely in Hawaii for 5 weeks. I worked beginning and end in and from CA. A payroll clerk in my job advised me to update my “physical address” to Hawaii while I was there but that I can keep my “mailing address” in CA at my permanent residence.

1. Is the w2 based on the physical address or the mailing address that I list with my job?

2. Is it okay to change the 5 weeks back to my CA physical address since it ended up being more like a visit rather than moving there? 

3. if I keep my physical address as Hawaii for those 5 weeks, would I need to pay taxes in both CA and Hawaii? For the whole time I was with the job? For those 5 weeks specifically? Pay income tax twice?
4. does it matter that I’m a CA resident and not a Hawaii resident?

im just wondering what my options are (if I can or should change my physical address back to my permanent residence in CA as I am now back), and what it will entail to file taxes (and if I will be able to file with TurboTax for this situation?). 

Thank you for your help!

[SundayInSalem]

Your state tax withholding depends on your payroll department. Your company should withhold based on where you live and/or work, not where you receive your mail. It doesn't always happen. 

It sounds as if you are back in California so check you pay stubs to see what tax was withheld for those five weeks—California or Hawaii.

Update your address

If you are back in California, update your address. Your employer should withhold California tax. People who earn money while physically present in California must pay California tax, whether you are a resident or nonresident.

You are most likely still a resident, despite a five-week absence. California says, "If you are physically present in California for at least nine months you are presumed to be a resident of California for purposes of the California personal income tax under CRTC § 17016."

See: Residency and income sourcing

What about Hawaii?

Unfortunately, you are liable for both Hawaii and California tax for those five weeks you were in The Aloha State. Hawaii taxes telecommuters and I assume you remained a California resident while working “temporarily” in Hawaii.

Kokua Line: Teleworking from paradise may sting come tax time

File a nonresident Hawaii return and a resident California return. California will give you a credit for tax paid to Hawaii. TurboTax can handle this situation.

How do I file a nonresident state return?

[TomD8]

If your domicile (your main, permanent home) is in California, for tax purposes you remain a resident of California during temporary absences.  Your income remains fully taxable by California, regardless of where you earn it.

Income from work physically performed in Hawaii in taxable by Hawaii.

Therefore you must file two state tax returns: a non-resident Hawaii tax return reporting your income earned in Hawaii, and your home state California tax return, reporting all your income - including what you earned in Hawaii.

You'll be able to claim a credit on your CA return for the taxes paid to HI, so you won't be double-taxed.

TurboTax can handle this common situation.