What’s Happening? The digital economy has allowed increasing numbers of nonresidents to work remotely for California firms without becoming California residents, and even without paying California income taxes, in some cases. At the same time, more and more nonresidents find themselves being offered lucrative temporary employment in California. This…
The Case A recent case from California’s Office of Tax Appeals brings some clarity to how strictly California dates a change of residency for income tax purposes when a nonresident claims to have moved to California shortly after a liquidity event. The case, Appeal of Housman, OTA Case No. 18010200…
Hot as a Recalled MacBook Battery The non-fungible token market has become as hot as a recalled MacBook lithium battery (if that’s possible). You’ve probably seen the figures: digital artist Beeple sold an NFT for a remarkable $69 million; a LeBron James non-fungible dunk clip lasting ten seconds went for…
The Issue Can COVID-19 orders make you a resident? Since the COVID-19 emergency struck, tens of thousands of nonresidents have found themselves marooned in California due to coronavirus travel restrictions. The typical situation involves a seasonal visitor forced to remain in a vacation home longer than intended. But it…
The Six-Month Mythos You don’t have to be a tax lawyer to know that the way to avoid becoming a resident of California is to spend less than six months in the state during any calendar year. Right? Well, not exactly. The “six-month presumption,” as it’s called, which is mentioned…
Where is Bitcoin? This may sound like a question on a Philosophy 101 midterm exam. But in fact, it’s a real-world tax issue, with potential huge tax consequences for nonresident traders, investors, and users of cryptocurrency, at least to the extent they have financial connections with California, through an…
The Remote Economy: A Two-Way Street The internet economy, ecommerce and constant connectivity has allowed increasing numbers of nonresidents to provide remote services to California businesses without setting foot here. As long as those nonresidents meticulously follow the rules, they can work remotely free from California income taxes. Or…
Is Bigfoot a California Resident? Manes Law discussed its top five internet myths about California tax residency rules in a previous article. Here are five more. Again, they’re in no particular order, but the commentary should provide some indication about how important they are and why. Myth #1: Leave…
The Issue While not quite as prevalent as Bigfoot videos, myths about California’s residency tax rules abound on the internet. Of course, believing in Bigfoot won’t increase your chances of a residency audit, or cost you tens or hundreds of thousands of dollars if the audit goes against…
Our office has experienced a significant increase in the number of taxpayers reporting they have received 4600 Notices “Request for Tax Return” sent by the Franchise Tax Board (California’s tax enforcement agency). The likely explanation is discussed below. What’s Happening? This July, our office saw a spike of 100% from…