WA state LLC doing business remote for CA company

Forum|Forum|2 years ago
February 8, 2024
1 reply
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I am a consultant and a single member of my LLC registered in Washington state. I do all my business remotely from Washington with a client company in California. I have never done any work in California. Do I have to pay taxes to California?

Not A Product Question

RobertB4444

Not if they are just a remote client. If you do any work for your California client in California or if they become an actual employer (issuing a W2 instead of just being a client) then you will have to file California taxes.

@rzemmaoui

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TomD8

Employee

@Richphil777 --

Be aware that if you receive a 1099-NEC from your California client, the California Franchise Tax Board is likely to expect a California tax return from you.

Due to a 2019 California court decision (the "Bindley" decision), California now taxes non-resident independent contractors on income received from clients located in California, even if the independent contractor performed no work within California.

https://ota.ca.gov/wp-content/uploads/sites/54/2019/08/18032402_Bindley_Decision_OTA_053019.pdf

Also see: https://www.andersen.com/pressroom/california-decision-highlights-states-aggressive-stance-on-taxing-non-resid

**Answers are correct to the best of my ability but do not constitute tax or legal advice.