How to file california state if all wages were earned in Alaska?

[karteroko]

Client has a california address but for 2018 , all his wages was derived from working in Alaska. He worked seasonally from January to May and then again from June to November. He comes home to California after each contract season.

[itonewbie · Accepted solution]

Based on the little information you provided, your client is a domicile resident of CA and is in AK only for temporary and transitory periods.  On that basis, he remains a tax resident of CA and, as Lisa says, is subject to CA tax on worldwide income.

Since there is no personal income tax in AK, he will just need to report his wages and pay tax to CA as usual with no credit for AK tax to offset his CA liability.  Note also that you should not rely on Box 1 of W-2 to report CA wages because CA does not fully conform the IRC; you should review details of your client's W-2 breakdown and adjust for non-conformity items such as HSA accordingly.

[karteroko]

Thank you!

[Just-Lisa-Now-]

CA residents pay taxes on their worldwide income.  

If he has to pay AK tax and file a non resident AK return as well (Does AK have income taxes??) then CA will give him credit for taxes paid to another state so that he's not double taxed.

If AK does have an income tax return, be sure to prepare it first so that the credit to other states carries over to CA.

[karteroko]

Thanks!