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Military residency in Califora

sillysyl
Level 3

Military client in 2023 earned wages from DFAS and a w-2 from Home Depot bef9re he enlisted.

He stationed in Virginia, but his residency is in California.  I have been reading that he is not required to

pay California taxes on the earnings from DFAS. Is this correct? if so, what form is there to select or confirm is military status?  Does he become a part non resident?  Need some guidance.

 

Thank you

Tax Wiz

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6 Comments 6
Terry53029
Level 15
Level 15

If I understand you are saying his resident of record is CA. Usually military only pays state income tax to his state of record (some states do not tax at all, but you need to check CA) Check his W2 and see if CA taxes withheld. If he worked outside of military before joining, or while stationed in another state that income would be taxable to state he worked in (not his military pay) There is no form to confirm his military status except for his W2 from DFAS, and that is taxed to federal. Some states only tax military if they are stationed in his resident of record, but do not tax if stationed in another state. You have to check the state for your client, as several states handle military different. To be sure no state can tax his military pay except his state of record (where he enlisted), also there is a way he can change his state of record.

sjrcpa
Level 15

California does not tax military pay of a CA resident. Most software has a box in the W-2 entry screen to indicate the W-2 is military pay. You didn't say what software you are using.

He stays a CA resident unless he affirmatively changes it with the military. It doesn't matter that he is stationed in VA.

This is probably addressed in the CA instructions, or else CA has issued a fact sheet/memorandum, etc.


The more I know the more I don’t know.
George4Tacks
Level 15

California puts out some pretty good publications. https://www.ftb.ca.gov/forms/2024/2024-1032-publication.pdf

 


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sillysyl
Level 3

Yes, thank you, for your response, it is greatly appreciated. I understand.

The military did tax his home recorded state.

 

sillysyl
Level 3

I understand your response.

According to the state, my client is considered a non resident.  The military did not tax my client, but the 

w-2 did show CA as the state that he earned military wages.

thanks for your answers.

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BobKamman
Level 15

But he's considered a resident for the part of the year that he lived and worked in California, before enlistment.  

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