Husband worked and lived in CA all 2010.
I moved to NYC in July.. and worked here. I didn't have any CA income (was a full time student before my move).
We own a house in CA.

How should we file the state taxes? I know that we have to file MFJ for Federal.
And based on the discussion here:

https://www.askmehelpdesk.com/taxes/husband-california-all-2010-wife-ny-part-year-resident-how-file-556224.html

It seems that I should file MFJ for both states - NY and CA.

BUT.. I am confused when filling the NY tax. Should I report both income here? It asked for Federal income.. which is both of our income. Please advise. TIA.

Yes, file as MFJ both places. For NY file a part-year resident return. Yes it asks for all your income, but it also has report the portion that is NY source, and the result is you pay taxes only on the NY source income. It's a little confusing because it first makes you calculate NY income tax on your total income, but later you multiply that initial calculation by a percentage that reflects how much was NY source versus total income, Then when you file CA you report all joint income again, but you take a credit for taxes paid to NY. So in the end you effectively pay taxes to each state only on the income earned in each state.

Thank you, ebaines! I am going to try to do this tonight.