Full-time Student in AZ; Resident of CA; Internship in VA

Forum|Forum|1 year ago
March 15, 2025
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My son was a full-time student in AZ in 2024. His principal place of residency is CA. In the summer of 2024, he was an intern at a company located in VA for 10 weeks. During this time he lived in VA. All of his income for 2024 was earned in VA and he only had VA tax withheld. What is the proper way to file his state returns? Is he a resident of CA, non-resident of VA? In doing this, CA taxes the income and doesn't allow a credit for the VA taxes paid; however VA will allow a credit for the CA taxes paid. This seems extremely unfair to VA since the entirety of the wages were earned while he lived and worked there. As an alternative, what are the ramifications of adjusting CA wages to $0 so no tax is owed (thus not filing) and claiming residency for the 10-week period in VA. A previous year CA return was filed.

xmasbaby0

Employee

If your son is your dependent, then on your own tax return you can say he lived with you all year; living away at college is considered to be a "temporary absence." So he is a resident of CA for his own tax return. BUT---he earned income in the state of VA. So before he completes a CA tax return, he needs to prepare a NON-resident return for the state of VA. He did not earn any income in AZ (per what you say here) so there is nothing to file or prepare for AZ.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

JewlzKAuthor

Are there earned income levels for claiming a student as a dependent? He earned the income, but he did not use it to support himself while away at school, i.e. he pocketed it.

xmasbaby0

Employee

@JewlzK If your son is a full-time student under the age of 24, the amount he earned is not a factor in whether you can claim him as a dependent. If he is older than 23, then if he earned more than $5050 he cannot be claimed as anyone else's dependent.

MAK70

Virginia is a reverse credit state so it is reported correctly. He will file and report the income to California as a resident, then prepare the Virginia nonresident return. He will get (at least most of) the Virginia withholding refunded, but owe California. I believe Virginia allows the reverse credit because they have a statutory residency (if you live in the state more than 183 days) even if it is not your domicile.