[aspiringCPA]

We file MFJ for both Federal and State. In Nov 08, both me and my wife lost our jobs in Los Angeles. Both of us found new jobs in March 09, but not in LA. My job was in Boston and my wife's in Northern CA. In view of the tight job market, we decided to move to different places rather than wait - me to MA and wife to the Bay area - and put our house on sale.

Luckily, the house in LA sold in a few months, and in Oct 09 we both bought a home each in MA and the Bay area as our primary residences.

In Nov 09, a company in San Francisco, that I had talked with more than a year ago, called me with a job offer. I accepted and moved back from MA to CA in Dec 09. My condo in MA just sold last week.

What will be our residency status for CA return for 2009 - part-year resident or full-year resident? Can I Claim MA residency from Mar-Nov, my wife be a full year CA resident, and we file MFJ return for CA as part-year residents? Or, CA will insist that we are both full-year CA residents and tax me on my MA income?

[MukatA]

Yes, CA will treat that your moving from CA was temporary or transitory so it will like to tax you for your full year worldwide income. To be safe, file as full year resident and claim credit for taxes paid to MA. In MA you are part year resident. Your U.S. Tax Return: Working or Living in Two or More states

[aspiringCPA]

Thanks MukatA.

Does it matter that the MA job was a full-time permanent job, I bought a house there as primary residence? The intention was to move permanently.

Would it help if we file Married Filing Separately? The tax rate in MA is 5.3% while CA is 9.55%. Paying additional 4.25% to CA is going to be a large amount.

Appreciate your advise.