Bernard S wrote:

- quote -

If the owner/manager is a nonresident of California, his (or
her) salary is California source income to the extent he
performs services for the corporation in California. His
salary should be prorated thus: working days in
California/working days everywhere.

If the corporation is a C corporation, any dividends will
not be California source income to the nonresident
stockholder. Income from intangibles (such as corporate
stock) has its source at the residence of the owner.

If it is an S corporation, its income (net of the
stockholder/employee's salary) is apportioned to California
based on the three-factor, double-weighted sales formula for
purposes of both the entity-level California tax on S
corporations and determining the California source income
passed through and taxable to the nonresident stockholder.

Katie in San Diego

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

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >

California corporation operates out of California but managed
from another state. Owner/manger is the only direct employee
and the Calif. operations are contracted for warehousing and
distribtion. How will the California tax authorities view the
nonresident managers? They probably spend a minimal amount of
time physical present in California.

Thank you.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >