My husband and I are filing jointly. We moved from CT to CA in 7/2020. My husband continues to work for his CT employer remotely here in CA. How do we file state returns?

[ashbert203]

I started 2020 as a student, did not work in CT, and began working 7/2020 in CA. Husband's company allows remote working due to COVID. We have been residents of CA since 7/2020. Do we do both CA and CT tax filings? Going forward, does husband's CT employer have to change anything?

[ErnieS0 · Accepted solution]

Yes. File a part-year California and a part-year Connecticut income tax return.

Report on your California return all income from July 2020, including your husband’s CT earnings. CA will give you a credit for income double taxed by CT.

Report on the CT return all of your husband’s income. For Income Allocation Part-Year Resident, enter the portion of your husband’s income earned while living in CT. On Nonresident Wage Allocation, choose the dollar amounts allocation option and enter the remaining wages as Connecticut Total (income that is from a source within Connecticut).

Connecticut follows the “convenience of the employer test,” meaning wages earned by a nonresident are allocated to the employer’s work location unless the nonresident works from an out-of-state location due to the necessity of the employer rather than the convenience of the employee.

Your husband may want to discuss this with his employer to see whether they are willing to move his work location (for payroll purposes) to California.

Related Resource:

Nonresident Working in Connecticut