MFJ Federal but not sure how to file state returns

[garrapatta]

Hello,

Thank you so much in advance.

I lived and worked in CA from 2019 to February 2022. Moved to Utah in Feb. 2022. I thought permanently, got my car registered, driver's licence switched. So worked about 8 months in Utah. However, in Dec. of 2022 I moved back to California and worked for 3 weeks in December. When I went to DMV since I left in February, they just re-issued my CA driver's license. My husband worked all this time in Utah. 

So I worked in 2022 in CA in January of 2022 and prior years, and December of 2022. 8 months in Utah.

1) Am I considered part-time resident in CA and UT? How do I file my state return? 

2) I also work as an independent contractor (so I have 1099 form) and rental property in Utah, do I need Turbo Tax Desktop? 

3) MFJ - e-file, state?

Thank you!

@ErnieS0 you were very helpful last year, I was hoping you could help again as well as anyone else on here. Thank you so much!

[ErnieS0]

Yes. You are a part-time California resident and a part-time Utah resident. You moved to Utah with the intent of staying there for an indefinite period of time and took steps to establish permanent residency.

Your Utah income will be 8 months of your W-2 income, your husband’s full-year Utah income, 12 months of rental income, and whatever 1099 income you earned as a Utah resident. Rental income is full-year because the property is located in Utah. Residency doesn’t matter for the rental. You’d report a full-year rental to Utah whether a resident, part-year resident, or non-resident.

You can use either TurboTax Online or CD/Download if you file together.

Utah and California both require you to file a joint return (if you file a joint federal return) unless one spouse was a full-year nonresident.

Depending on your income and your husband’s income and your husband’s residency, it’s possible filing separately may work out better. However, California is a community property state, so you’d have to split your total income 50/50, in which case you’d need CD/Download.

Because of that (without knowing much about your situation) and the fact that a bulk of your joint income comes from Utah, I suspect filing separately would not help much.

[garrapatta]

@ErnieS0  Thank you so much, Ernie!

So if I hadn't changed my DL and registration in Utah, then, I would have been considered a non-resident even though I worked? I was wondering if I could still be considered non-resident for UT or not? 

My husband's UT income is 9k. Mine from CA total is 18k.  UT income 24k + 950 for 1099. We did not make that much at all last year. 

Would separate be better? Thank you! 

[GeorgeM777]

It depends.  When you moved back to California did you intend to make CA your permanent home?  If yes, then whether you changed your driver's license/registration or not, would not have mattered.  You would have become a CA resident, and because you were there for about three months, your residency status for CA would be part-year resident.  Here are the requirements for CA residency obtained from the CA Franchise Tax Board website:

Am I a resident?

You’re a resident if either apply:

• Present in California for other than a temporary or transitory purpose
• Domiciled in California, but outside California for a temporary or transitory purpose

There are more factors for determining residency. Visit Guidelines for Determining Resident Status (FTB Publication 1031) for more details.

Given your income, you may not need to file a CA tax return.  Here are the tax filing requirements for CA for Married Filing Jointly or Separately: 

CA Gross Income Filing Requirements: 

CA Adjusted Gross Income Filing Requirments:

CA is also a community property state, so you may need to include your spouse's income when deciding whether you need to file a CA return.  

Community property

California is a community property state. If one spouse is a resident of California and the other is not, you may be required to report income earned outside of California.

Visit Guidelines for Determining Resident Status (FTB Publication 1031) for more information.

Here is the link to the CA website from which all of the above information was obtained:

CA Franchise Tax Board

@garrapatta 

[garrapatta]

@GeorgeM777 thank you, George! 

To make sure I understood you correctly, 

1) So I do CA and UT both joint? CA joint even though my husband didn’t live or work in CA in 2022?

2) Can I e-file everything or do I need TT Desltop/Download? 

3) So even though I lived in CA in 2021, I’m still considered part time CA resident? It’s year by year? 
Thank you!! 

[GeorgeM777]

Question 1 - Yes, and probably yes.  Yes, you need to file a CA part-year resident return and a UT part-year resident return.   You will probably need to file a joint return even though your spouse did not work in CA.   Because CA is a community property state, when one spouse has CA source income and the other spouse does not, the CA source income is split and both spouses are deemed to have CA income.  Thus, both spouses will need to file a CA return.  

Question 2 - Yes, you can e-file all your returns.  You can use either TurboTax download or TurboTax Desktop.  The choice is yours to make.

Question 3 - Yes, you are considered a part-year resident of CA for 2022 because you lived and worked there until mid-February 2022, and then you returned for a few weeks in December 2022 to work again.  Thus, for 2022, you were a part-year resident of CA.  Yes, residency/part-year residency is determined on a year-by-year basis.  

Given the income requirements for CA, you may not owe any tax to CA.  You can refer to my prior post and the screenshots of the minimum income levels for CA.  However, TurboTax will calculate what tax is due to CA, if any.  Moreover, if you had tax withholding to CA, and after completing your CA return you don't owe any tax to CA, then filing a return will be necessary to collect your refund from CA.  

@garrapatta 

[garrapatta]

@GeorgeM777 @GeorgeM777  I can't thank you both enough. Thank you so much!