Situation: I live in a foreign country and earn income there, and I am a California resident.

1. At the federal level, there is foreign earned income exclusion OR foreign tax credit. Is there the same at the state level (CA)? Or will I have to pay state taxes on all income sources regardless of being taxed by the foreign country?

2. Is there a way, for tax purposes, to rescind state residency without establishing residency in a different state? That is, no longer be a resident. (Since I'm living fully in the other country).

Thanks.

You cannot "recind" state residency without moving to a location and intending to remain there indefinitely. Because your intend is difficult to prove, the tax authorities will look to your actions to determine if you appeared as though you intended to remain there indefinitely.

If you are under and employment agreement outside of California for 546 days and you do not have large investment income, you may be able to be treated as a nonresident of California. See http://www.ftb.ca.gov/forms/misc/1031.pdf