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Residency and California income taxes, part 2: Who has to file?

In the first part of this post, we began discussing the question of when nonresidents or partial year residents have to pay taxes in California.

We set the stage by talking about a long-running dispute involving a wealthy man who moved from California to Nevada.

In today's post, let's look in more detail at who does or does not have to file a tax return in California.

For year-round California residents, whether or not you have to file a California income tax return depends on the amount of your income. On its website, the California Franchise Tax Board (CFTB) has a chart that shows these amounts. The amounts are based on gross income or adjusted gross income.

For nonresidents, income amounts come into play as well. Again, there is a chart to consult. If your income from all sources is above a certain level, and some of that income is California source income, it triggers an obligation to file a state tax return in California.

What about partial year residents? Here too it is necessary to consult a chart listing income levels. If your taxable California income was more than a certain amount, you will have to file a state income tax return there.

For part-year residents, this may seem a bit surprising. It's surprising because the amount of time you actually spend in California is not part of the test for determining whether you have to file here. Instead, it comes down to the amount of your California source income.

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