I worked and lived in Alaska for three months last year. Currently living back in California, my place of residence, I am wondering if I will have to pay California income taxe on the revenue earend in Alaska?
Should I file as multi resident? Whats the best way for me to go about this?
Does California Tax you on your out of state income?
Well, the tax return you should file is the 540NR, the "California Non-Resident or Part Year Resident Income Tax Return for 2007. Thus, you will be filing a Multi-State Tax Return for 2007.
To answer your other question, No, California does not double tax you on your Alaska Income or Revenue. In fact, California, will use your total Federal Adjusted Gross Income and will require that you subtract your Alaska Income to arrive at your CA taxable income. This is shown on Schedule CA (540NR).
Hence, California taxable income is only based on CA sourced income or revenue and out of state taxable income is excluded from taxation. But, the itemized deductions will be pro-rated as some income would be excluded from CA taxation.