Sunday, June 23, 2013

Out of State Filing

Q.  I live and work in the state of Hawaii.  This year, my income has all come from the state of California. I did spend 5 weeks in CA, but will file as a Hawaii resident, paying both federal and HI taxes. Since I spent so little time in CA, am I correct in thinking that I am not liable for CA taxes?

A.  The time one spends in any state, only determines whether or not you are a full time resident, part time resident, or just a visitor. Your requirement for filing is determined by the source income, with a different limit for almost every state. Normally the state bases the filing requirement on your Adjusted Gross Income (AGI) together with your filing status. If you are at or over this threshold, you are required to file a return. CA is one of the most aggressive states. Please don't wait until CA tries to contact you. By then they will add stiff penalties plus interest. I suggest you take a look at the list of states on the left side of this blog and visit the Franchise Tax Board website in California.