Steve Sims EA llc

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California taxation for Military Servicemember’s can be confusing... Let’s simplify it by making “active duty” military Servicemember’s EXEMPT!

Service members domiciled outside of California, and their spouses, exclude the servicemember’s military compensation from gross income when computing the tax rate on non-military income.

(Generally, for tax purposes, active duty military are considered a resident of the state from which you entered  the military...Your domicile)

Military servicemember’s domiciled in California must include their military income in total income. In addition, they must include their military pay in California source income when stationed in California.   However, military pay is not California source income when a servicemember is permanently stationed outside of California.

Income from a servicemember’s non-military spouse for services performed in California is not California source income subject to state tax if the spouse is in California to be with the servicemember serving in compliance with military orders, and the servicemember and spouse have the same domicile in a state other than California. Click on link for the publication that explains domicile.

Click on this link:

https://www.ftb.ca.gov/forms/2016/16_1032.pdf

steve@stevesimsea.com