Anyone With California Tax Filing Experience w/ Immigrant Fiance?

[Bugs 455]

Okay, I spent hours trying to research my specific question, and got nowhere, so I'll just try and post here and hope for the best...

My fiance moved here to California on a K-1 visa in December, upon which we got married. She had income in the Philippines during 2013 before she did so.

We are married filing jointly on both my federal and state tax forms, so we must include this income. However, even though we must report this foreign earned income of my spouse's on my 1040 Federal form, we can then exclude it with Form 2555.

However, with California taxes, it gets cloudy...

First off, I must file form California 540NR instead of the standard California form 540, since she was a nonresident of California for part of 2013. Secondly, California does not recognize the foreign earned income exclusion that the Federal 1040 allowed, so we must add it back for California tax purposes. However, with Schedule 540NR, under column E, I can change our taxable income to just "income earned or received as a CA resident and income earned or received from CA sources as a nonresident".

Who is this talking about? In other words, I was a CA resident for all of 2013, so does this mean that since we are filing jointly, her foreign income is still considered income earned or received as a CA resident since I was one while she earned it? Or can we exclude her foreign income in column E since she was not a CA resident while earning it (even though I was)?

Also, I'm completely lost as to what to fill in for myself in Part I of this Schedule.

Here it is... https://www.ftb.ca.gov/forms/2012/12_540nrca.pdf

Edited January 26, 2014 by Leon & Mylen

[No name 88 48]

Stuff like this is the reason I hired an Expat accountant. I hate hiring lawyers. A good accountant is hard to find but the rewards and lack of headaches are worth it. I hope you find you answer.

[Lynkali 163]

Ack, and here I was relieved by other threads saying the foreign income exclusion was fairly easy to take. I haven't started working on taxes yet (still waiting on my W2s and 1099s) but I'm in a very similar situation -- foreign fiance earned income abroad until August of 2013, came here in September and we married in October. I was hoping to be able to exclude his foreign income because he already paid taxes on it in Finland. But I haven't even looked at the California state forms ... so very good question.

Anyone else filed from California with foreign income exclusion?

[Bugs 455]

California doesn't accept the federal foreign exclusion. However Schedule 540NR column E allows you to make a percentage-based adjustment off of only amounts earned as a California resident. So my question is whether or not that includes her income since we are filing jointly and I was a resident the entire year, even if she wasn't while she earned that.

Edited January 26, 2014 by Leon & Mylen

[Dean_De 61]

Okay, I spent hours trying to research my specific question, and got nowhere, so I'll just try and post here and hope for the best...

My fiance moved here to California on a K-1 visa in December, upon which we got married. She had income in the Philippines during 2013 before she did so.

We are married filing jointly on both my federal and state tax forms, so we must include this income. However, even though we must report this foreign earned income of my spouse's on my 1040 Federal form, we can then exclude it with Form 2555.

However, with California taxes, it gets cloudy...

First off, I must file form California 540NR instead of the standard California form 540, since she was a nonresident of California for part of 2013. Secondly, California does not recognize the foreign earned income exclusion that the Federal 1040 allowed, so we must add it back for California tax purposes. However, with Schedule 540NR, under column E, I can change our taxable income to just "income earned or received as a CA resident and income earned or received from CA sources as a nonresident".

Who is this talking about? In other words, I was a CA resident for all of 2013, so does this mean that since we are filing jointly, her foreign income is still considered income earned or received as a CA resident since I was one while she earned it? Or can we exclude her foreign income in column E since she was not a CA resident while earning it (even though I was)?

Also, I'm completely lost as to what to fill in for myself in Part I of this Schedule.

Here it is... https://www.ftb.ca.gov/forms/2012/12_540nrca.pdf

Thre is a live chat in the ftb page..why not give it a try and raise them your question directly

https://www.ftb.ca.gov/

scroll at he buttom left part of the page and you will see live chat

[Bugs 455]

Thanks, I will check it out.

[Bugs 455]

Update:

I chatted with CA Franchise Tax Board agent using Dean's above link. He said that we have to combine our incomes on the 540NR, but then can subtract hers using column E in the Schedule.