Do I need to file taxes in California if I was a student out of state, and changed residency in August?

Question

I went to college in Maryland for 4 years, but remained a California resident. While living in Maryland I earned nontaxed (scholarship) and taxed (but claimed exempt from state) income. I moved to Virginia and became a resident in August and earned only nontaxed (scholarship) income. Do I need to file as a resident or a non resident of California (or file at all)? Do I need to file as a part time resident of Virginia?

Answer 1

While you were a CA resident, all income was taxable by CA regardless of where it was earned. Any income you earned in VA was also taxable there. You'd claim a credit on your CA return for the VA taxes paid.

In the years you were a CA resident you'll file a CA resident return and a VA non-resident return. In the year that you changed your domicile you'll file part-year returns in both states.

Keep in mind that if you return to CA when you complete your studies, CA may treat your change in domicile as a tax dodge and assess taxes on the income you earned in VA after you "changed" your domicile. CA is noted for doing this to students and military personnel.