Is this a California Source Income?

[CamCHernandez]

Does my client have to pay CA state income tax on income earned from UCLA while she worked from her home in Texas? She lives in Texas and works remotely as an online professor.

She moved out of California last May, so I know she needs to pay CA income tax when she was in CA. But what about the income she earned in Texas as a TX resident from May - December?

I know that she is a Part-year resident: A part-year resident is taxed on all income from all sources while a resident and only on income derived from California sources while a nonresident.

I can't tell if her UCLA income is "derived from California sources." I have tried to look for the CA source rule and I found on TTB's California Tax for CRTP's page 14 "Wages and salaries have a source where the services are performed. Neither the location of the employer, where the payment is issued, nor the taxpayer’s location when he or she receives payment affect the source of this income. "

I would really appreciate any help on this. I have read and read this and I can't figure it out. I am guessing that since she was working from her home office in TX that it is TX source, but I don't want to guess. I would also appreciate a citation.

Thank you,
Cameron Hernandez

[taxea]

sounds like the source of the work is her present location unless the work she does is done by logging into a computer located at UCLA. In that case I would say the source of the work occurs at UCLA and that makes it CA income.

[CamCHernandez]

sounds like the source of the work is her present location unless the work she does is done by logging into a computer located at UCLA. In that case I would say the source of the work occurs at UCLA and that makes it CA income.

Thank you so much. With so many people working remotely this is making the source question more difficult to figure out.

[Rapid Robert]

Check CA's market assignment rules.

https://www.ftb.ca.gov/businesses/Sales_Factor.shtml

"Under market assignment, sales of other than tangible personal property are assigned to the California sales factor numerator if:
Sales from services are in California to the extent the purchaser of the service received the benefit of the services in California."

I'd say the purchaser of the online professor's service received the benefit of the service in CA.

You didn't say whether the professor is a W-2 employee or independent contractor. If W-2 employee, I'd follow what's reported for the state on the W-2.