DORFMONT[at]aol.com wrote:

- quote -

Hi Linda,

Well, as we always say in this business, it depends <G> .

Is H a US citizen, or a citizen of Mexico? How much time
does he spend in California? Are the spouses estranged, or
just living apart while continuing to maintain the marital
relationship? Who withheld CA tax on his income? Is he
employed by a California company?

If his employer is based in CA, they would probably have to
cover him in CA for unemployment tax purposes, so that may
explain why they withheld CA tax. You'd need to talk to the
employer to help them understand that just because an
expatriate employee is reported to the state for
unemployment tax purposes, his earnings aren't California
source income if he doesn't live or work in the state.

Whatever the answers to my questions (and others that would
no doubt arise if we really got into this <G> ), you can
reassure the client that the FTB would not take her house.
The worst they would do, if a final assessment was unpaid,
would be to put a lien on it, which would have to be
satisfied if the property was sold. But they wouldn't turn
her out of her house.

Katie in San Diego

The foregoing is intended for educational purposes only and
does not constitute legal or professional advice.

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My client lives in Mexico in his own home. His wife lives in
California in a home owned by both of them. He has lived in
Mexico since 1997 and has established a legitimate residence
there (Mexican driver's license, votes at the consulate,
etc.). His wife is frightened that the FTB will take her
home (his house) was because they will say that he really
lives in California. We went through this battle trying to
get his erroneously withheld California taxes refunded. He
works in Europe. She flies between L.A. and N.Y.C. We
finally got all the money back but based on what I have seen
FTB do (go after another Mexican client who came from
Florida and this past year moved to Arizona, go after my
friend's daughter who has lived in Wisconsin for many years
with her family and owns a rental condo in the Valley which
she reports). His wife is worried. Given this situation is
there any chance he could be considered a California
resident.

Linda Dorfmont E.A., CFP, CSA

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