Analysis and guidance on California residency issues, FTB audit defense, and exit planning strategies
The single most common trigger for an FTB residency audit is changing your filing status to nonresident while continuing to own your California home. Understanding what FTB looks for—and what they're entitled to request—is crucial to protecting your interests.
Read Article →Taxpayers have had very little success appealing FTB residency audit decisions in recent years. We analyze recent Office of Tax Appeals decisions to understand what works, what doesn't, and why establishing your position during the audit is critical.
Read Article →California's safe harbor provisions are narrower than most people realize. The 546-day employment rule, the nine-month presumption, and other provisions come with significant limitations—particularly for high-net-worth individuals.
Read Article →The evolution from the 19 Bragg factors to a three-category framework provides structure for understanding how California evaluates residency. Physical presence, registrations and filings, and personal associations—how they interact matters.
Read Article →California doesn't have a formal exit tax, but the practical reality is more nuanced. Deferred compensation, equity, and 1031 exchanges can follow you after departure. And many discover they never actually escaped California's jurisdiction at all.
Read Article →Working remotely for a California employer doesn't automatically mean California tax—but there are traps for the unwary. Understanding where services are performed, how workdays are tracked, and what FTB can discover matters.
Read Article →FTB's initial questionnaire is typically the opening move in what could become a full residency audit. Understanding what they're looking for, protecting your privacy rights, and responding strategically can significantly affect the outcome.
Read Article →Filing under the wrong status can result in overpaying taxes or triggering an audit. The distinction hinges on whether you had a period of California residency during the year—and the tax calculation differs significantly.
Read Article →While a California audit drags on for months or years, the statute of limitations in your claimed new state keeps running. If California prevails, you may need to amend that other state's return—but your window may have closed.
Read Article →Texas, Nevada, Florida—the appeal is obvious. But FTB knows the math too. Auditing your move to a no-tax state yields better returns than auditing moves to other income-tax states. Expect heightened scrutiny.
Read Article →Equity compensation follows special sourcing rules that trip up even sophisticated taxpayers. Where you live when income is recognized is only part of the equation—California also looks at where you worked during the earning period.
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