Q:

Why do non-California residents need to file California state taxes?

A:

Quick Answer

Non-residents of California are responsible for filing taxes in the state if the person received income from California sources, according to the State of California Franchise Tax Board or FTB. Taxes for California are also required for non-residents for services performed in the state.

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Full Answer

The California FTB taxes all non-residents on income received in the state from a business, trade or profession. If only part of the income or loss is derived from California, only that portion of the income from California is taxed, as noted by the FTB.

Taxes on stocks or bonds are paid if the sale took place while a resident was in California. Real estate gains or losses are taxed from where the property is located, whether or not the owner is a resident of California.

Income from a partnership, corporation or trust is also subject to non-resident tax. A business partner who lived in the state part time as an owner is responsible for part of the income of the partnership. The same ruling applies to corporation shareholders and partners of an LLC that is defined as a partnership. Beneficiaries of a trust are also subject to California tax if certain trusts are held in the state.

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