California Guidelines for Determining Resident Status

Guidelines for Determining Resident Status 
2023 FTB Publication 1031 Guidelines for Determining Resident Status
1031

FTB Publication

2023
Guidelines for Determining
Resident Status

Table of Contents
Page
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Basic Filing Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Which Form to File . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Filing Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Who Are Residents and Nonresidents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Significance of Residency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Guidelines for Determining Residency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Temporary or Transitory Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Income Taxable by California . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Specific Professions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Residents of or Individuals in Foreign Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Meaning of Domicile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Married/RDP Filing Separate Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
How to Split Income on Form 540NR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Avoid Common Mistakes on Form 540NR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Double-Taxed Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
General Phone Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Franchise Tax Board Privacy Notice on Collection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

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2023 Guidelines for Determining Resident Status
What’s New

In general, California nonresidents or part-year residents
determine their California tax by multiplying their
California taxable income by an effective tax rate. The
effective tax rate is the California tax on all income as
if you were a California resident for the current tax year
(and for all prior taxable years for any carryover items,
deferred income, suspended losses, or suspended
deductions) divided by that income.
This method ensures that nonresidents pay the correct
tax on their California sourced income and does not tax
non-California sourced income.
For more information, get FTB Pub. 1100, Taxation of
Nonresidents and Individuals Who Change Residency.

Federal Veterans Auto and Education Improvement
Act (VAEIA) of 2022 – The VAEIA was enacted on
January 5, 2023, and made amendments to the federal
Servicemembers Civil Relief Act (SCRA). California
conforms to the following VAEIA provisions:
• A spouse of a servicemember shall neither lose
nor acquire a residence or domicile for purposes of
taxation with respect to the person, personal property,
or income of the spouse by reason of being absent
or present in any tax jurisdiction of the United States
solely to be with the servicemember in compliance
with the servicemember’s military orders.
• For any taxable year of the marriage, a servicemember
and the spouse of such servicemember may elect to
use for purposes of taxation, regardless of the date
on which the marriage of the servicemember and the
spouse occurred, any of the following:
• The residence or domicile of the servicemember.
• The residence or domicile of the spouse.
• The permanent duty station of the servicemember.
For more information, get FTB Pub. 1032, Tax Information
for Military Personnel.

Registered Domestic Partners (RDP)
Under California law, RDPs must file their California
income tax returns using either the married/RDP filing
jointly or married/RDP filing separately filing status.
RDPs have the same legal benefits, protections, and
responsibilities as married couples unless otherwise
specified.
If you entered into a same sex legal union in another
state, other than a marriage, and that union has been
determined to be substantially equivalent to a California
registered domestic partnership, you are required to file a
California income tax return using either the married/RDP
filing jointly or married/RDP filing separately filing status.
For purposes of California income tax, references to
a spouse, husband, or wife also refer to a California
RDP, unless otherwise specified. When we use the
initials RDP they refer to both a California registered
domestic “partner” and a California registered domestic
“partnership,” as applicable. For more information on
RDPs, get FTB Pub. 737, Tax Information for Registered
Domestic Partners.

A Introduction
It is important for California income tax purposes that you
make an accurate determination of your residency status.
Residency is primarily a question of fact determined
by examining all the circumstances of your particular
situation. This publication provides information to help you
determine the following:
• Whether you are a resident of California.
• Whether your income is taxable by California.
• Which form to file if you have a California
filing requirement.
The Franchise Tax Board (FTB) issues written advice
on whether a particular activity or transaction is subject
to tax under California income tax law. The FTB will not
issue written opinions on whether you are a California
resident for a particular period of time because
residency is a question of fact, not law. The information
included in this publication is provided to help you with
this determination.

Military Personnel and Spouses
In addition to this publication, military personnel and
spouses should use FTB Pub. 1032, Tax Information for
Military Personnel.

B Basic Filing Requirements
Residents – File a California tax return if either your gross income (which consists of all income you received from all sources in the form of money,
goods, property, and services, that is not exempt from tax) or your adjusted gross income (which consists of your federal adjusted gross income from all
sources, reduced or increased by all California income adjustments) is more than the amounts shown on the chart below for your filing status, age, and
number of dependents.
Nonresidents and Part-Year Residents – File a California tax return if you have any income from California sources and your gross income (which
consists of all income you received from all sources in the form of money, goods, property, and services, that is not exempt from tax) or adjusted gross
income (which consists of your federal adjusted gross income from all sources, reduced or increased by all California income adjustments) is more than
the amounts shown on the chart below for your filing status, age, and number of dependents.
Note: If your gross income or adjusted gross income is less than the amounts listed on the chart, you may still have a filing requirement. For more
information, get California Form 540 Personal Income Tax Booklet or California Form 540NR Nonresident or Part-Year Resident Booklet.
On 12/31/23,
my filing status was:

Single or head of household

(Get FTB Pub. 1540, Tax Information for
Head of Household Filing Status)

and on 12/31/23,
my age was:

(If your 65th birthday is on
January 1, 2024, you are considered to be
age 65 on December 31, 2023)

Under 65
65 or older

California Gross Income
Dependents
0

1

2
or more

21,561
28,761

36,428
39,911

47,578
48,831

California Adjusted Gross Income
Dependents
2
0
1
or more
17,249
24,449

32,116
35,599

43,266
44,519

(Continued on next page)
FTB Pub. 1031 2023 Page 3

B Basic Filing Requirements – Continued
On 12/31/23,
my filing status was:

California Gross Income
Dependents

and on 12/31/23,
my age was:

(If your 65th birthday is on
January 1, 2024, you are considered to be
age 65 on December 31, 2023)

0

1

2
or more

Married/RDP filing jointly
Married/RDP filing separately

Under 65 (both spouses/RDPs)
65 or older (one spouse/RDP)
65 or older (both spouses/RDPs)

43,127
50,327
57,527

57,994
61,477
68,677

69,144
70,397
77,597

Qualifying surviving spouse/RDP

Under 65
65 or older

36,428
39,911

47,578
48,831

Dependent of another person
Any filing status

Any age

(The income of both spouses/RDPs must
be combined; both spouses/RDPs may be
required to file a tax return even if only one
spouse/RDP had income over the amounts
listed.)

California Adjusted Gross Income
Dependents
2
0
1
or more
34,503
41,703
48,903

49,370
52,853
60,053

60,520
61,773
68,973

32,116
43,266
35,599
44,519
More than your standard deduction (Use the California Standard Deduction
Worksheet for Dependents, in the instructions for your tax return, to figure your
standard deduction.)

Even if you do not meet the basic filing requirements, you should still file a tax return in order to get a refund if any of the following apply:
California state income tax was withheld from your pay, California real estate sale, or income from an S corporation, partnership, or Limited Liability Company (LLC).
You made California estimated tax payments.
You have withholding from Form(s) 592-B, Resident and Nonresident Withholding Tax Statement, or 593, Real Estate Withholding Statement.

•
•
•

C Which Form to File
Residents – If you were a full-year resident of California
in 2023 and you meet the basic filing requirements
outlined in Section B, file either Form 540 or
Form 540 2EZ, California Resident Income Tax Return.
However, if you file a joint return and either spouse/RDP
was a nonresident or a part-year resident in 2023,
file Form 540NR, California Nonresident or Part-Year
Resident Income Tax Return.
Nonresidents and Part-Year Residents – If you were a
full-year nonresident of California in 2023 and you meet
the basic filing requirements outlined in Section B, or if
you were a California resident for part of the year, file
Form 540NR.

D Filing Status
Use the same filing status for California that you used for
your federal income tax return, unless you are an RDP. If
you are an RDP and file single for federal, you must file
married/RDP filing jointly or married/RDP filing separately
for California. If you are an RDP and file head of household
for federal purposes, you may file head of household for
California purposes only if you meet the requirements to
be considered unmarried or considered not in a domestic
partnership. If you did not file a federal return because you
did not have a federal filing requirement, you may use any
filing status on your California return that you were entitled
to use on your federal return had you been required to file
a federal return.
Exception: If you file a joint return for federal purposes,
you may file separately for California if either spouse was
one of the following:
• An active member of the United States armed forces or
any auxiliary military branch during 2023.
• A nonresident for the entire year and had no income
from California sources during 2023.
Regardless of your residency status, if you file separate
California returns, enter the amount you would have
reported if you had filed a married filing separate return
when the instructions for the California return say to enter
an amount from your federal return. Attach an explanation
to your California return showing how you split the
income from your joint federal return between you and
Page 4 FTB Pub. 1031 2023

your spouse. If you are required to attach a copy of your
federal return to your California return, attach a copy of
your joint federal return.
For RDP filing status information, get FTB Pub. 737.

E Who Are Residents and
Nonresidents
A resident is any individual who meets any of the
following:
• Present in California for other than a temporary or
transitory purpose.
• Domiciled in California, but outside California for
a temporary or transitory purpose. See Section L,
Meaning of Domicile.
A nonresident is any individual who is not a resident.
A part-year resident is any individual who is a California
resident for part of the year and a nonresident for part of
the year.

Safe Harbor
Safe harbor is available for certain individuals leaving
California under employment-related contracts. The safe
harbor provides that an individual domiciled in California
who is outside California under an employment-related
contract for an uninterrupted period of at least 546
consecutive days will be considered a nonresident unless
any of the following is met:
• The individual has intangible income exceeding
$200,000 in any taxable year during which the
employment-related contract is in effect.
• The principal purpose of the absence from California is
to avoid personal income tax.
The spouse/RDP of the individual covered by this safe
harbor rule will also be considered a nonresident while
accompanying the individual outside California for at
least 546 consecutive days.
Return visits to California that do not exceed a total
of 45 days during any taxable year covered by the
employment contract are considered temporary.
Individuals not covered by the safe harbor determine their
residency status based on facts and circumstances. The
determination of residency status cannot be solely based
on an individual’s occupation, business, or vocation.

Instead, consider all activities to determine residency
status. For instance, students who are residents of
California leaving this state to attend an out-of-state
school do not automatically become nonresidents, nor
do students who are nonresidents of California coming
to this state to attend a California school automatically
become residents. In these situations, individuals must
determine their residency status based on their facts and
circumstances, as described in Section G, Guidelines
for Determining Residency, and Section H, Temporary or
Transitory Purposes.
Example 1 – You are a California resident. You agreed
to work overseas for one year. You returned to California
after the employment contract expired and stayed for
three months. Then, you signed another contract with
the same employer to work overseas for another year.
You cannot be considered a nonresident under the safe
harbor rule because your absence from California for
employment reasons was not for an uninterrupted period
of at least 546 consecutive days. You cannot combine the
days you were overseas from the two separate contracts.
Example 2 – You are a California resident. You transferred
to your employer’s Germany office for a two-year work
assignment. You visited California for a three-week
vacation. Under the safe harbor rule, you were a
nonresident of California for the two years you were in
Germany. Your three-week visit to California is considered
temporary.
Example 3 – You and your spouse are California residents.
You agreed to work overseas for 20 months under an
employment contract. Your family remained in San Diego,
CA. During those 20 months you visited your family
in San Diego for a month. You can be considered a
nonresident during your absence under the safe-harbor
rule. Your month-long visit to California is considered
temporary. During the year, you earned $80,000 on your
overseas assignment and your spouse earned $30,000 as
a teacher in San Diego. You did not have any other income.
The tables on the next page show how to report income if
you filed a joint income tax return or separate income tax
returns.
Joint Return
Return for You and Your Spouse
Form 540NR
CA AGI
Total AGI

Income

Sch CA (540NR)
Col. E
Your Wages

$80,000

$80,000

$40,000*

Spouse’s Wages

$30,000

$30,000

$30,000

Total Wages

$110,000

$110,000

$70,000

Separate Returns

Income

Your Return
Form 540NR
Total AGI
CA AGI

Your Spouse’s Return
Form 540
Total AGI

Sch CA
(540NR)
Col. E

Sch CA (540)
no adjustments

Your Wages

$40,000

$0

$40,000*

Spouse’s Wages

$15,000

$15,000

$15,000

Total Wages

$55,000

$15,000

$55,000

*Half of your wages are taxable to California because
California is a community property state and your
spouse/RDP is a resident of California.

F Significance of Residency
Residency is significant because it determines what
income is taxed by California. For more information, see
Section I, Income Taxable by California.

G Guidelines for Determining
Residency
The underlying theory of residency is that you are a
resident of the place where you have the closest
connections.
The following list shows some of the factors you can
use to help determine your residency status. Since your
residence is usually the place where you have the closest
ties, you should compare your ties to California with your
ties elsewhere. In using these factors, it is the strength
of your ties, not just the number of ties, that determines
your residency. This is only a partial list of the factors to
consider. No one factor is determinative. Consider all
the facts of your particular situation to determine your
residency status.
Factors to consider are as follows:
• Amount of time you spend in California versus amount
of time you spend outside California.
• Location of your spouse/RDP and children.
• Location of your principal residence.
• State that issued your driver’s license.
• State where your vehicles are registered.
• State where you maintain your professional licenses.
• State where you are registered to vote.
• Location of the banks where you maintain accounts.
• The origination point of your financial transactions.
• Location of your medical professionals and other
healthcare providers (doctors, dentists, etc.),
accountants, and attorneys.
• Location of your social ties, such as your place of
worship, professional associations, or social and
country clubs of which you are a member.
• Location of your real property and investments.
• Permanence of your work assignments in California.

H Temporary or Transitory
Purposes

Generally, your state of residence is where you have your
closest connections. If you leave your state of residence,
it is important to determine if your presence in a different
location is for a temporary or transitory purpose. You
should consider the purpose and length of your stay
when determining your residency. Military personnel and
spouses, get FTB Pub. 1032.

Coming into California
When you are present in California for temporary or
transitory purposes, you are a nonresident of California.
For instance, if you come to California for a vacation, or
to complete a transaction, or are simply passing through,
your purpose is temporary or transitory. As a nonresident,
you are taxed only on your income from California sources.
When you are in California for other than a temporary
or transitory purpose, you are a California resident. For
instance, if your employer assigns you to an office in
FTB Pub. 1031 2023 Page 5

California for a long or indefinite period, if you retire and
come to California with no specific plans to leave, or if you
are ill and are in California for an indefinite recuperation
period, your stay is other than temporary or transitory. As
a resident, you are taxed on income from all sources.
You will be presumed to be a California resident for any
taxable year in which you spend more than nine months
in this state.
Although you may have connections with another state,
if your stay in California is for other than a temporary
or transitory purpose, you are a California resident.
As a resident, your income from all sources is taxable
by California.
Example 1 – You are a business executive and reside in
New York with your family. Several times each year you
travel to other states for business purposes. Your average
stay is one or two weeks and the entire time spent in
California for any taxable year does not exceed six weeks.
Your family usually remains in New York when you are
traveling for business purposes.
Determination: Under these circumstances, you are not
a California resident because your stays in California are
temporary or transitory in nature. As a nonresident, you
are taxed only on your income from California sources,
including your income for services performed in California.
Example 2 – In December 2022, you moved to California
on an indefinite job assignment. You rented an apartment
in California and continued to live in the apartment.
You retained your home and bank account in Illinois
until April 2023, at which time you sold your home and
transferred your bank account to California.
Determination: Your assignment in California was for
an indefinite period; therefore, your stay in California was
not of a temporary or transitory nature. Although you kept
ties in Illinois until April 2023, you became a California
resident upon entering the state in December 2022. As a
resident, you are taxed on your income from all sources.

Leaving California
Any individual who is a resident of California continues to
be a resident when absent from the state for a temporary
or transitory purpose.
An absence from California under an employmentrelated contract for a period of at least 546 consecutive
days may be considered an absence for other than a
temporary or transitory purpose. See “Safe Harbor” under
Section E, Who Are Residents and Nonresidents for more
information.
Example 3 – Until September 2023, you were a resident
of California. At that time, you declared yourself to be a
resident of Nevada, where you have a summer home. You
continue to spend six or seven months each year at your
home in California, which you have retained. You spend
only three to four months in Nevada and the rest of the
time traveling in other states or countries. You transferred
your bank accounts to Nevada. However, you continue
to maintain your social club and business connections in
California.
Determination: Your declaration of residency in Nevada
does not establish residency in that state. Your closest
connections are to California and your absence from
California is for temporary or transitory purposes. You are,
therefore, a resident of California and are taxed on your
income from all sources.
Example 4 – You and your spouse/RDP are California
residents. You accept a contract to work in South America
Page 6 FTB Pub. 1031 2023

for 16 months. You lease an apartment near the job site.
Your contract states that your employer will arrange your
return back to California when your contract expires. Your
spouse/RDP and your children will remain in California
residing in the home you own.
Determination: You maintain strong ties with California
because your spouse/RDP and children remain in your
California home during your absence. Your intent is to
return to California, and your absence is temporary and
transitory. You remain a California resident during your
absence. You are taxed on income from all sources,
including income earned in South America.
Example 5 – You receive and accept a permanent job
offer in Spain. You and your spouse/RDP sell your home
in California, pack all of your possessions and move to
Spain on May 5, 2023, with your children. You lease an
apartment and enroll your children in school in Spain. You
obtain a driver’s license from Spain and make numerous
social connections in your new home. You have no
intention of returning to California.
Determination: You are a part-year resident. Through
May 4, 2023, you were a California resident. On
May 5, 2023, you became a nonresident. All your income
while you were a resident is taxable by California. While
you are a nonresident, only income from California
sources is taxable by California.
Example 6 – You are a resident of California. You accept
a 15-month assignment in Saudi Arabia. You put your
personal belongings, including your automobile, in
storage in California. You have a California driver’s license
and are registered to vote in California. You maintain
bank accounts in California. In Saudi Arabia, you stay
in a compound provided for you by your employer, and
the only ties you establish there are connected to your
employment. Upon completion of your assignment, you
will return to California.
Determination: You have maintained greater connections
with California than you have established in Saudi
Arabia. Your absence is for a temporary or transitory
purpose. Therefore, you remain a California resident.
As a California resident, your income from all sources
is taxable by California, including the income that you
earned from your assignment in Saudi Arabia.
Example 7 – You are a resident of California and a
single taxpayer. You accept a three-year assignment
in Japan. Your assignment in Japan covers the period
January 1, 2022, through December 31, 2024. You rented
out your residence and put your truck and belongings in
storage in California. You maintained your California bank
accounts, driver’s license, and voter registration. You have
less than $200,000 of intangible income during each year.
Upon completion of your assignment, you intend to return
to California. You returned to California to visit family no
longer than a total of 45 days during 2022 or 2023.
Determination: You meet the safe harbor rule. You are a
nonresident during your absence from the state.

I

Income Taxable by
California

Residents of California are taxed on ALL income,
including income from sources outside California.
Nonresidents of California are taxed only on income
from California sources. Nonresidents of California are
not taxed on pensions received after December 31, 1995.
For more information, get FTB Pub. 1005, Pension and
Annuity Guidelines.

Part-year residents of California are taxed on all income
received while a resident and only on income from
California sources while a nonresident.
If you use Form 540NR, figure your taxable income
as if you were a California resident for the entire
year. Complete Schedule CA (540NR), California
Adjustments — Nonresidents or Part-Year
Residents, column A through column D, to figure total
adjusted gross income (AGI). Figure California AGI
applicable to a nonresident or part-year resident on
Schedule CA (540NR), column E.
Treat specific types of income as explained below.

Wages and Salaries
Wages and salaries have a source where the services
are performed. Neither the location of the employer,
where the payment is issued, nor your location when
you receive payment affect the source of this income.
Part-year residents include on Schedule CA (540NR),
column E all wages and salaries earned while a resident,
regardless of where the services were performed.
Nonresidents include the income for services performed
in California.
Example 1 – You are a resident of New York working
temporarily in California for a New York corporation.
Determination: Your income earned for services
performed in California has a California source. As a
nonresident, include this California source income on
Schedule CA (540NR), column E.
Example 2 – You are a California resident. As a
representative for your employer, you spent two weeks
in Georgia to give training. You were paid by a Georgia
corporation while you were in Georgia.
Determination: Because you are a California resident,
you are taxed on all income, regardless of source. The
income is taxable by California, even though it has a
source in Georgia.

Interest and Dividends
Interest and dividends generally have a source where you
are a resident. However, see Exception below.
Example 3 – You are a resident of Texas and have
interest from a California bank account.
Determination: Because you are a resident of Texas, the
interest has a source in Texas. The interest is not taxable
by California.
Example 4 – You are a resident of California and have
interest from a savings account in Oregon.
Determination: Because you are a California resident,
you are taxed on all income, regardless of source. The
interest is taxable by California.
Example 5 – You are a resident of Montana and have
dividends from a California corporation.
Determination: Because you are a Montana resident, the
dividends have a source in Montana. The dividends are
not taxable by California.
Exception: Interest and dividends have a source in
California if the account or security is used in a trade or
business or pledged as security for a loan, the proceeds
of which are used in a trade or business in California. For
special rules regarding qualifying investment securities,
refer to California Revenue and Taxation Code (R&TC)
Section 17955.

Business Income (or Loss)
A nonresident’s income from California sources includes
income from a business, trade, or profession carried
on in California. If the nonresident’s business, trade, or
profession is carried on both within and outside California,
the income sourced to California may be based only
on the business conducted within California, or may
be determined by using the apportionment formula for
corporations engaged in multistate businesses.
California uses a mandatory market assignment method
and single-sales factor apportionment to apportion
business income to California. A nonresident may have
California sourced income or apportionable business
income if receiving income from sales or services
sourced to California. Such income includes:
1. Sales of services to the extent that the purchaser of the
service receives the benefit of the service in California.
2. Sales of intangible property to the extent that the
intangible property is used in California. For marketable
securities, the sales are in California if the customer is
in California.
3. Sales from the sale, lease, rental, or licensing of real
property if the real property is located in California.
4. Sales from the rental, lease, or licensing of tangible
personal property if the property is located in California.
Refer to Cal. Code Regs., tit.18 section 17951-4 to
determine when income from business, trade or profession
should be sourced according to apportionment rules. Also,
see R&TC Section 25136 and Cal. Code Regs., tit. 18
section 25136-2 or California Schedule R, Apportionment
and Allocation of Income, for more information.
Withholding may be required on a nonresident’s business
income if an exemption, waiver, or reduction is not
certified or approved.

Pensions and Keoghs
Residents: Distributions from employer-sponsored
and self-employment (Keogh) pension, profit-sharing,
stock bonus plans, or other deferred compensation
arrangements are taxable by California regardless of
where the services were performed.
Nonresidents: Distributions are not taxable by California
if received after December 31, 1995. Get FTB Pub. 1005
for more information.
Example 6 – You were a resident of California when you
earned your pension. You retired during 2023 and moved
permanently to New Mexico. After becoming a resident of
New Mexico, you begin drawing your pension.
Determination: Since you are a nonresident, the
distribution is not taxable by California because you
received it after December 31, 1995.
Example 7 – You lived and worked in Ohio. You retired
in Ohio and received your first pension check on
January 1, 2023. You moved permanently to California on
July 1, 2023.
Determination: You became a California resident on
July 1, 2023. Your pension income received beginning
July 1, 2023, is taxable by California because California
residents are taxed on all income, regardless of source.

Lump-Sum Distributions
Residents: Lump-sum distributions are taxable by
California. Residents of California are taxed on all income,
regardless of source. Therefore, the distribution is taxable
FTB Pub. 1031 2023 Page 7

even if it is attributable to services performed outside of
California and accrued prior to your becoming a California
resident.
Nonresidents: Lump-sum distributions from a qualified
plan or annuity after December 31, 1995, are not taxable
by California. However, lump-sum distributions, derived
from a California source, received from most nonqualified
plans after December 31, 1995, continue to be taxable by
California. For more information, get FTB Pub. 1005.
Example 8 – You lived and worked in New York. You
retired and moved to California and became a resident.
Prior to relocating, you elected to receive a lump-sum
distribution from your qualified pension plan. You received
the distribution after you became a California resident.
Determination: The distribution is taxable by California
because California residents are taxed on all income,
regardless of source (Appeal of Ralph G. and Martha E.
McQuoid, California State Board of Equalization,
May 11, 1989).
Example 9 – You were a California resident and worked
for a corporation in California. You moved to Ohio
during 2023 and elected to take a lump-sum distribution
from your qualified pension plan. You received the
distribution after you became a resident of Ohio.
Determination: Since you are a nonresident, the
distribution is not taxable by California because you
received it after December 31, 1995.

Individual Retirement Account (IRA),
Roth IRA, SIMPLE IRA, Simplified
Employee Pension (SEP), and Keogh
Distributions
IRA, Roth IRA, SIMPLE IRA, SEP, and Keogh distributions
received after becoming a nonresident are not taxable by
California if received after December 31, 1995.
Distributions from an SEP from contributions made
after 1986 are taxed by California in the same manner
as pension and Keogh distributions. Distributions from
contributions made before 1987 are taxed by California
in the same manner as IRA distributions. For more
information, get FTB Pub. 1005.

Sale of Real Estate
The gain or loss from the sale of real estate has a source
where the property is located. If you sell your California
real estate and move out of state, the gain is taxable by
California. The gain is taxable by California even if the real
estate is sold when you are a nonresident.
Example 10 – You are a resident of Idaho. You sold
undeveloped real estate located in California at a gain.
Determination: Because the property is in California,
the gain is California source income. As a nonresident,
include this California source income on
Schedule CA (540NR), column E.
Example 11 – You are a resident of California. You sold
real estate located in England at a gain.
Determination: Because you are a California resident,
you are taxed on all income, regardless of source. The
gain on the sale is taxable by California.
Example 12 – You are a resident of Nevada. You own
residential rental property located in California. Your
property has always shown a loss. You sold the property
for a gain.
Page 8 FTB Pub. 1031 2023

Determination: Because the property is located in
California, the gain on the sale is taxable by California.
Since rental real property is classified as a passive
activity, the sale “triggers” the release of suspended
losses incurred in taxable years beginning on or after
January 1, 1987. The suspended losses may be used
to offset any gain from the sale or income from other
passive activities. For more information, get form
FTB 3801, Passive Activity Loss Limitations, and
instructions, or FTB Pub. 1016, Real Estate Withholding
Guidelines.

Withholding Services and Compliance
Withholding may be required on income with a California
source. This includes, sales of California real estate,
income allocations or distributions from S corporations
and partnerships, and other payments of California
source income paid to nonresidents. Note: Withholding is
not always required. An exemption, reduction, or waiver
can be filed.
With certain limited exceptions, payers that are required
to withhold and remit backup withholding to the Internal
Revenue Service (IRS) are also required to withhold and
remit to the FTB. The California backup withholding rate
is 7% of the payment. For California purposes, dividends,
interests, and any financial institution’s release of loan
funds made in the normal course of business are exempt
from backup withholding. For additional information on
California backup withholding, go to ftb.ca.gov and
search for backup withholding.
For more information regarding California withholding
requirements, get FTB Pub. 1016 and FTB Pub. 1017,
Resident and Nonresident Withholding Guidelines.
Write to:
WITHHOLDING SERVICES AND COMPLIANCE
MS F182
FRANCHISE TAX BOARD
PO BOX 942867
SACRAMENTO CA 94267-0651
Telephone: 888.792.4900 from within the United States
916.845.4900 from outside the United States
California
Relay
Service:
711 or 800.735.2929 for persons with hearing
or speaking limitations
FAX:
916.845.9512

Partnership, S Corporation, Limited
Liability Company (LLC), and Trust
Income (Loss)
When a partner is a part-year resident during any part of
the partner’s or the partnership’s taxable year, the part-year
resident must divide his or her taxable year into two distinct
periods. For the period during which the part-year resident
was a resident of this state, all items of income and
deductions are to be included in the partner’s California
taxable income. For the period during which the part-year
resident was a nonresident of this state, only gross income
and deductions realized from sources within this state
are included in the partner’s California taxable income.
Therefore, all California-sourced items of income and loss
realized by the partnership during the partnership’s taxable
year when the partner was a nonresident of this state are
included in California taxable income. This also applies
to shareholders of an S corporation, partners of an LLC

classified as a partnership, and beneficiaries of a trust.
See FTB Legal Ruling 2003-1, FTB Pub. 1017, and
FTB Pub. 1100 for more information.
Example 13 – Kim, a nonresident calendar year individual
taxpayer, has a 50% interest in partnership (P). P has a
December 31 year-end. P conducts business within and
outside California. For the fiscal year ended December
31, Kim’s Schedule K-1 (565), Partner’s Share of Income,
Deductions, Credits, etc., from P shows that Kim has
$10,000 of taxable income from all sources, $5,000 of
which is sourced to California. On September 15, Kim
became a resident of California.
Determination: Kim was a nonresident for 257 days of
P’s fiscal year and a resident for 108 days. Kim will include
in California taxable income for the year, $6,480 of income
from P, computed as follows:
• For the portion of the year Kim was a nonresident:
257/365 X $ 5,000 = $3,521
• For the portion of the year Kim was a resident:
108/365 X $10,000 = $2,959
Example 14 – Hope, a calendar year individual resident of
California, owns a 50% share of an S corporation (Buddy
Corp.). Buddy Corp. has an October 31 year-end. Buddy
Corp. conducts business within and outside California.
For the October 31 year-end, Hope’s Schedule K-1 (100S),
Shareholder’s Share of Income, Deductions, Credits, etc.,
from Buddy Corp. shows that Hope has $8,000 of taxable
income from all sources, $3,000 of which is sourced to
California. On June 10, Hope became a nonresident
taxpayer.
Determination: Hope was a nonresident for 144 days of
Buddy Corp.’s fiscal year-end and a resident for 221 days.
Hope will include in California taxable income for the year,
$6,028 of income from Buddy Corp., computed as follows:
• For the portion of the year Hope was a nonresident:
144/365 X $3,000 = $1,184
• For the portion of the year Hope was a resident:
221/365 X $8,000 = $4,844

Sale of Stocks and Bonds
The gain or loss from the sale of stocks or bonds has
a source where you are a resident at the time of the
sale. If buying and selling stocks and bonds is your
trade or business, see “Business Income (or Loss)”
under Section I, Income Taxable by California for more
information.
Example 15 – You are a resident of Oregon and sell stock
of a California corporation at a gain.
Determination: Because you are an Oregon resident,
the gain has an Oregon source. The gain is not taxable by
California.
Example 16 – You are a resident of California and sell
stock of a Kansas corporation at a gain.
Determination: Because you are a California resident,
you are taxed on all income, regardless of source. The
gain is taxable by California.

Installment Sales
California taxes installment gains received by a
nonresident from the sale of tangible property on a source
basis. Real property is sourced and taxed based upon
where the property is located. California taxes residents

on all income regardless of source. The chart below
indicates the tax treatment for installment payments
received by residents, nonresidents, and individuals who
changed residency:
Residency
Status
Always a
Nonresident

Sold
Property

California
Property

Out-of-State
Property

Anytime

Taxable

Nontaxable

Always a
Resident

Anytime

Taxable

Taxable

Former
Resident

Prior to
moving out

Taxable

Former
Nonresident

Prior to
moving in

Taxable

2001 and prior Taxable
2002 and after Nontaxable
2001 and prior Nontaxable
2002 and after Taxable

For the treatment of interest earned on an installment
sale, see “Interest and Dividends” under Section I,
Income Taxable by California.
For more information regarding the taxation of installment
sales, get FTB Pub. 1100.

Reimbursement of Moving Expenses
The source of reimbursed moving expenses is the state to
which you move, regardless of your residency at the time
the reimbursement is made.

J Specific Professions
Military and Spouses
Military personnel and spouses should get FTB Pub. 1032.

Civilians Working for the Military
The rules for military personnel do not apply to civilians
working for the military. Determine your residency status
and the source of your income based on the guidelines
previously explained in Sections E through I.

Career Appointees in the U.S. Foreign
Service
The rules for military personnel and spouses do not
apply to career appointees in the U.S. Foreign Service.
Determine your residency status and the source of your
income based on the guidelines previously explained in
Sections E through I.

Airline Employees
The wages of nonresident flight personnel (e.g. pilot,
copilot, flight attendant) are not taxable by California
unless more than 50% of the individual’s scheduled flight
time is in California. If more than 50% of the scheduled
flight time is in California, wages are apportioned to
California based on the ratio of time spent in California to
the total scheduled flight time.
Flight personnel who are California residents are taxed
on all wages received regardless of where the flight time
is spent.

FTB Pub. 1031 2023 Page 9

Interstate Rail and Motor Carrier
Employees
The wages of nonresident railroad employees or truck
drivers whose regularly assigned duties are performed in
two or more states may only be taxed by the individual’s
state of residence.
Railroad employees or truck drivers who are California
residents are taxed on all wages received regardless of
where the duties are performed.

Merchant Seamen
A merchant seaman who is in California only because
this state is a port-of-call and who maintains no other
contact or connections with this state, is a nonresident.
However, a seaman who maintains close connections
with California remains a California resident while at sea.
Under such circumstances, the seaman’s absence is for a
temporary or transitory purpose.
Example 1 – You are a merchant seaman and spend six
to ten months a year aboard a ship outside California. You
spend your off-duty time in California. You own a home in
California where your spouse/RDP resides. You vote and
bank in California. You have a California driver’s license
and your automobile is registered in California.
Determination: You are a resident of California. Your
time at sea is temporary and transitory. As a resident,
all your income is taxable by California, including your
income earned while at sea (Appeal of James H. and
Leila P. Pike, California State Board of Equalization,
February 1, 1983).
Example 2 – You are a merchant seaman and spend
eight to ten months a year aboard a ship outside
California. You are single and have no dependents. You
spend 50% of your off-duty time or 10% of your total
time in California. You return to California only when your
employment brings you here. When visiting California,
you stay in hotels. You have a California bank account
in joint tenancy with your father. You have a California
driver’s license, but no car. You do not own real property
in California.
Determination: You are a nonresident of California.
Your ties to California are not substantial and your
time in California is temporary or transitory (Appeal of
Richard W. Vohs, California State Board of Equalization,
September 17, 1973).

K Residents of or Individuals
in Foreign Countries
If you are a resident of a foreign country and perform
services in California and/or receive income from
California sources, you may have a California income
tax filing requirement even if you do not have a federal
filing requirement.

Tax Treaty
A tax treaty between the U.S. Government and a foreign
country may exempt some types of income from federal
taxation. Generally, unless the treaty specifically excludes
the income from taxation by California, the income
is taxable.
Example 1 – You are a resident of China doing research
at a university in California and received wages of
$15,000 for teaching and doing research. For federal
Page 10 FTB Pub. 1031 2023

income tax purposes, the wages are excludable due to
the tax treaty between the United States and China.
Amounts received for teaching, research, or other
services performed by a student are not excludable as
a qualified scholarship or fellowship, even if the services
are required as a condition of receiving the scholarship
or fellowship.
Determination: Although the wages may be exempt
from income for federal income tax purposes, the wages
will be taxable by California. The tax treaty specifically
states that the taxes covered by the tax treaty are
federal income taxes imposed by the Internal Revenue
Code. Tax treaties between the United States and other
countries which expressly limit their application to federal
income taxes do not apply to California. Nonresidents
are taxed by California on wages for services performed
in California. Since you received wages for services
performed in California, the wages are taxable by
California. Include the wages of $15,000 on
Schedule CA (540NR), Part II, Section A, line 1a,
column C.

Income Tax Clearance
A federal income tax clearance does not affect your
California tax liability. The FTB does not issue tax
clearance certificates for individuals in this situation.

Foreign Tax Credit or Foreign Earned
Income Exclusion
California does not allow a foreign tax credit or a foreign
earned income exclusion. If you claimed the foreign
earned income exclusion on your federal return, include
the amount of your foreign earned income exclusion
on Schedule CA (540NR), Part II, Section B, line 8d,
column C.

L Meaning of Domicile
The term “domicile” has a special legal definition that is
not the same as residence. While many states consider
domicile and residence to be the same, California makes
a distinction and views them as two separate concepts,
even though they may often overlap. For instance, you
may be domiciled in California but not be a California
resident or you may be domiciled in another state but be
a California resident for income tax purposes.
Domicile is defined for tax purposes as the place where
you voluntarily establish yourself and family, not merely for
a special or limited purpose, but with a present intention
of making it your true, fixed, permanent home and
principal establishment. It is the place where, whenever
you are absent, you intend to return. The maintenance
of a marital abode in California is a significant factor in
establishing domicile in California.

Change of Domicile
You can have only one domicile at a time. Once you
acquire a domicile, you retain that domicile until you
acquire another.
A change of domicile requires all of the following:
• Abandonment of your prior domicile.
• Physically moving to and residing in the new locality.
• Intent to remain in the new locality permanently or
indefinitely as demonstrated by your actions.

M Married/RDP Filing
Separate Returns
Division of Income
California is a community property state. The domicile
of the spouse/RDP earning the income determines
the division of income between spouses/RDPs when
separate returns are filed. Each spouse/RDP must follow
the laws in his or her state of domicile to determine
whether income is separate or community. When
separate returns are filed, you and your spouse/RDP
must each report half of the community income plus all
of your separate income on your return. See Section L,
Meaning of Domicile.

Community Property
Community property is all of the property that is not
separate property acquired by a spouse/RDP or both
spouses/RDPs while domiciled in a community property
state, U.S. territory, or country.
Each spouse/RDP owns one-half of all community
property. If property cannot be specifically identified as
separate property, it is considered community property.
The following are community property states and U.S.
territories (countries not listed):
Arizona
New Mexico
California
Northern Mariana Islands
Guam
Puerto Rico
Idaho
Texas
Louisiana
Washington
Nevada
Wisconsin

Community Income
Income generated from community property is community
income. Community income also includes compensation
for services if the spouse/RDP earning the compensation
is domiciled in a community property state.
Divide the community income equally between you and
your spouse/RDP when separate returns are filed.

Separate Property
Separate property includes the following:
• Property owned separately by each spouse/RDP
before marriage or registering as a domestic
partnership.
• Property received separately as gifts or inheritances.
• Property purchased with separate property funds.
• Money earned while domiciled in a separate property
state.
• All property declared separate property in a valid
agreement.
Maintain separate property separately. If the property
or the income from the property is used for community
purposes, or commingled, it could lose its separate
property character, overriding any agreements.

Separate Income
Generally, income from separate property is income of
the spouse/RDP who owns the property. When filing, you
and your spouse/RDP report your income(s) separately
on your separate returns.

Deductions
Expenses incurred to earn or produce community business
or investment income are generally divided equally

between you and your spouse/RDP. Each spouse/RDP is
entitled to deduct half of the expenses of the business or
investment expenses on his or her separate return.
Expenses incurred to earn or produce separate business
or investment income are deductible by the spouse/RDP
who owns the investment generating the income, provided
that spouse/RDP pays the expenses from his or her
separate funds.
Expenses that are not attributable to any specific income,
such as medical expenses, are deductible by the
spouse/RDP who pays them. If these expenses are paid
from community funds, the deduction is divided equally
between you and your spouse/RDP.
If one spouse/RDP itemizes deductions, both
spouses/RDPs must itemize deductions, even if the
itemized deductions of one spouse/RDP are less than the
standard deduction.

Exemption Credits
When you file separate returns, you and your spouse/RDP
must each claim your own personal exemption credit.
When you have more than one dependent supported by
community funds, you and your spouse/RDP may divide
the number of dependents between you in any manner
you choose. However, you may not split the credit for any
one dependent.

Division of Income, Residents and
Nonresidents of California – Examples
Example 1 – You and your spouse/RDP are residents
of California. You earned $15,000 in wages. Your
spouse/RDP earned $30,000. In addition to wages, you
have stock that you inherited. The stock is in your name
only, and you keep the stock and the dividend income
separate from community funds. You received $5,000 in
dividends. You have decided to file separate returns.
Determination: You and your spouse/RDP each have
$22,500 in community income: ($15,000 + $30,000 =
$45,000 ÷ 2). In addition to your $22,500 in community
income to be reported, include the $5,000 of separate
income from dividends, making your total income $27,500.
Example 2 – You and your spouse/RDP are residents
of California. For the first six months of the year, you
earned wages of $30,000. Your spouse/RDP did not earn
any income. On June 30, you and your spouse/RDP
physically separated with no intention of reconciliation.
During the last six months, you earned wages of $30,000
and your spouse/RDP earned wages of $10,000. You
have decided to file separate returns.
Determination: For the first six months of the year, your
earnings were community income. You and your
spouse/RDP must each report on your individual returns
one half of the income earned during this period. When
you and your spouse/RDP physically separated with no
intention of reconciliation, your community income status
ended. Therefore, from July 1 through December 31,
the income earned by you and your spouse/RDP was
separate income.
You
Your Spouse/RDP
Community
Jan.–June
$15,000
$15,000
Separate
July–Dec.
30,000
10,000
Total
$45,000
$25,000

FTB Pub. 1031 2023 Page 11

Example 3:
John and Jackie are full-year nonresidents of California. Jackie earned $30,000 in wages reported on federal Form W-2,
Wage and Tax Statement, for services performed in her state of residence. Jackie also sold property in California that
was her separate property. She had a $100,000** gain. John received a pension distribution of $10,000 in 2023 based on
services performed in California. For California purposes, John’s taxable pension distribution for the year is 0.* John has a
rental house in California that is his separate property. His net rental income was $1,000.** John and Jackie filed separate
federal returns, therefore, they file separate California returns. The following situations show how their income should be
divided based on domicile.
1. John and Jackie are both
domiciled in community
property states.
WAGES
GAIN
PENSION
RENTAL INCOME

John
Schedule CA (540NR), Schedule CA (540NR),
column D
column E

TOTAL
$ 30,000
100,000
10,000
1,000

$ 15,000
0
5,000
1,000

Jackie
Schedule CA (540NR), Schedule CA (540NR),
column D
column E

$

0
0
0
1,000

$ 15,000
100,000
5,000
0

$
0
100,000
0
0

John would complete his Schedule CA (540NR) as shown in the partial view that follows.
Part II Income Adjustment Schedule
Section A — Income
from federal Form 1040 or 1040-SR

A

B

C

D

E

Federal Amounts
(taxable amounts from
your federal tax return)

Subtractions
See instructions
(difference between
CA and federal law)

Additions
See instructions
(difference between
CA and federal law)

Total Amounts
Using CA Law
As If You Were a
CA Resident
(subtract col. B from
col. A; add col. C
to the result)

CA Amounts
(income earned or
received as a CA
resident and income
earned or received
from CA sources
as a nonresident)

1a Total amount from federal Form(s) W-2, box 1.
See instructions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1a

$15,000

$15,000

5 Pensions and annuities. See instructions.
a ___$10,000___  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .5b

5,000

5,000

Section B — Additional Income
from federal Schedule 1 (Form 1040)
5 Rental real estate, royalties, partnerships,
S corporations, trusts, etc.  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 5

1,000

1,000

1,000

*California nonresidents are not taxed by California on pension income.
**This income is from separate property; therefore, it is not divided even when domiciled in a community property state.

2. John and Jackie are
domiciled in separate
property states.
TOTAL
WAGES
$ 30,000
GAIN
100,000
PENSION
10,000
RENTAL INCOME
1,000
3. John is domiciled in a
community property state
and Jackie in a separate
property state.
TOTAL
WAGES
$ 30,000
GAIN
100,000
PENSION
10,000
RENTAL INCOME
1,000
4. John is domiciled in a
separate property state
and Jackie in a community
property state.
TOTAL
WAGES
$ 30,000
GAIN
100,000
PENSION
10,000
RENTAL INCOME
1,000
Page 12 FTB Pub. 1031 2023

John
Schedule CA (540NR), Schedule CA (540NR),
column D
column E
$

0
0
10,000
1,000

$

0
0
0
1,000

Jackie
Schedule CA (540NR), Schedule CA (540NR),
column D
column E
$ 30,000
100,000
0
0

John
Schedule CA (540NR),
column D
$

Jackie

Schedule CA (540NR),
column E

0
0
5,000
1,000

$

0
0
0
1,000

Schedule CA (540NR),
column D

Schedule CA (540NR),
column E

$ 30,000
100,000
5,000
0

$
0
100,000
0
0

John
Schedule CA (540NR),
column D
$15,000
0
10,000
1,000

$
0
100,000
0
0

Jackie

Schedule CA (540NR),
column E
$

0
0
0
1,000

Schedule CA (540NR),
column D

Schedule CA (540NR),
column E

$ 15,000
100,000
0
0

$
0
100,000
0
0

How To Split Income on Form 540NR
Use this chart as a guide to split community income with your spouse/RDP based on domicile if you are married/RDP and
file Form 540NR.
Reminder: Include all of your separate income in addition to your half of the community income when filing. See “Division
of Income” under Section M, Married/RDP Filing Separate Returns.
TYPE

1
2
3
4

YOUR
DOMICILE

Community
Property
State

Separate
Property
State

Community
Property
State

Separate
Property
State

YOUR
SPOUSE’S/RDP’s
DOMICILE

Community
Property
State

Separate
Property
State

Separate
Property
State

Community
Property
State

Form 540NR,
Married/RDP Filing Jointly

Form 540NR,
Married/RDP Filing Separately
(you)

Form 540NR,
Married/RDP Filing Separately
(your spouse’s/RDP’s)

Schedule CA (540NR),
column A through column D:
All income
All deductions

Schedule CA (540NR),
column A through column D:
Half of all income
Half of all deductions

Schedule CA (540NR),
column A through column D:
Half of all income
Half of all deductions

Schedule CA (540NR),
column E:
All income taxable
by California

Schedule CA (540NR),
column E:
Half of all income
taxable by California

Schedule CA (540NR),
column E:
Half of all income
taxable by California

Schedule CA (540NR),
column A through column D:
All income
All deductions

Schedule CA (540NR),
column A through column D:
All your income
All your deductions

Schedule CA (540NR),
column E:
All income taxable
by California

Schedule CA (540NR),
column E:
All your income taxable by
California

Schedule CA (540NR),
column A through column D:
All your spouse’s/RDP’s income
All your spouse’s/RDP’s
deductions
Schedule CA (540NR),
column E:
All your spouse’s/RDP’s income
taxable by California

Schedule CA (540NR),
column A through column D:
All income
All deductions

Schedule CA (540NR),
column A through column D:
Half of your income
Half of your deductions

Schedule CA (540NR),
column E:
All income taxable
by California

Schedule CA (540NR),
column E:
Half of your income taxable by
California

Schedule CA (540NR),
column A through column D:
All income
All deductions

Schedule CA (540NR),
column A through column D:
All your income plus half of your
spouse’s/RDP’s income
All your deductions plus half of
your spouse’s/RDP’s deductions
Schedule CA (540NR),
column E:
All your income taxable by
California plus half
of your spouse’s/RDP’s income
taxable by California

Schedule CA (540NR),
column E:
All income taxable
by California

Schedule CA (540NR),
column A through column D:
All your spouse’s/RDP’s income
plus half of your income
All your spouse’s/RDP’s
deductions plus half of your
deductions
Schedule CA (540NR),
column E:
All your spouse’s/RDP’s income
taxable by California plus
half of your income taxable by
California
Schedule CA (540NR),
column A through column D:
Half of your spouse’s/RDP’s
income
Half of your spouse’s/RDP’s
deductions
Schedule CA (540NR),
column E:
Half of your spouse’s/RDP’s
income taxable by California

For information on income taxable by California, see Section I.

FTB Pub. 1031 2023 Page 13

N Avoid Common Mistakes
on Form 540NR
Avoid making time-consuming and costly mistakes by
reporting your AGI from all sources as if you were a
resident of California for the entire year.
California tax returns start with federal AGI. However,
there are differences between California and federal tax
law. Use Schedule CA (540NR) to convert your federal
AGI (column A) to your total AGI from all sources under
California law (column D) as follows:
• Copy your federal income, adjustments, and
deductions to the applicable lines on
Schedule CA (540NR), column A.
• Subtract income that is taxable under federal law but
not under California law (such as California lottery
winnings and social security benefits) by entering it on
Schedule CA (540NR), column B.
• Add income excluded on the federal return (such
as foreign income or income from non-California
municipal bonds), unless the income is specifically
excludable under California law, by entering it on
Schedule CA (540NR), column C.
• Do not subtract non-California source income to
determine your total AGI from all sources under
California law.
When you figure your California AGI on
Schedule CA (540NR), column E, be sure to include
the following:
• All income from every source while you were a
resident of California.
• Income from California sources while you were a
nonresident.
For more information, get the instructions for
Schedule CA (540NR).

O Double-Taxed Income
If you paid taxes to California and to another state on the
same income, you may qualify for a tax credit for taxes
paid to another state. Get California Schedule S, Other
State Tax Credit.

Page 14 FTB Pub. 1031 2023

P General Phone Service
Telephone assistance is available year-round from
8 a.m. until 5 p.m. Monday through Friday, except
holidays. Hours subject to change.
Telephone: 800.852.5711 from within the United States
916.845.6500 from outside the United
States
California
Relay
Service:
711 or 800.735.2929 for persons with
hearing or speaking limitations
IRS:
800.829.1040 for federal tax questions, call
the IRS
Asistencia En Español
Asistencia telefónica está disponible durante todo el año
desde las 8 a.m. hasta las 5 p.m. de lunes a viernes,
excepto días feriados. Las horas están sujetas a cambios.
Teléfono:
800.852.5711 dentro de los Estados Unidos
916.845.6500 fuera de los Estados Unidos
Servicio de
Retransmisión
de California: 711 o 800.735.2929 para personas con
limitaciones auditivas o del habla
IRS:
800.829.1040 para preguntas sobre
impuestos federales, llame al IRS

Q Franchise Tax Board
Privacy Notice on
Collection
Our privacy notice can be found in annual tax booklets
or online. Go to ftb.ca.gov/privacy to learn about our
privacy policy statement, or go to ftb.ca.gov/forms and
search for 1131 to locate FTB 1131 EN-SP, Franchise Tax
Board Privacy Notice on Collection – Aviso de Privacidad
del Franchise Tax Board sobre la Recaudación. To
request this notice by mail, call 800.338.0505 and enter
form code 948 when instructed.