How does California determine tax residency?

California primarily uses a 'temporary or transitory purpose' test. You are considered a resident if you are in California for other than a temporary or transitory purpose, or if you are domiciled in California and outside the state for a temporary or transitory purpose.

Does California have a 183-day rule for residency?

While not a strict 183-day statutory rule like some states, spending more than 6-9 months (183-270 days) in California can create a rebuttable presumption of residency. The FTB will look at all facts and circumstances to determine your closest connections.

What is the California 'safe harbor' rule for nonresidents?

The safe harbor rule allows certain individuals domiciled in California who leave for an uninterrupted 546-day period under an employment contract to be treated as nonresidents, provided they spend no more than 45 days in California per tax year and meet other specific conditions.

California Residency Guide: 'Temporary or Transitory Purpose' Test (2025)

California's Franchise Tax Board (FTB) is known for its rigorous enforcement of residency rules, and unlike many other states, it doesn't rely solely on a strict 183-day count. Instead, California determines residency based on whether your presence in the state is for a "temporary or transitory purpose."

Domicile vs. Residency in California

Domicile: Your true, fixed, and permanent home—the place where you intend to return.
Residency: While domicile is a factor, California often looks at where you *actually* spend your time and maintain your closest connections. You can be domiciled outside California but still be a California resident for tax purposes.

The Trap: California considers you a resident if you are in the state for other than a "temporary or transitory purpose," or if you are domiciled in California but are outside for a "temporary or transitory purpose."

The "Temporary or Transitory Purpose" Test

This is the core of California's residency determination. There isn't a single factor, but rather a "facts and circumstances" test. The FTB examines all available evidence to determine where your closest connections are.

Factors considered include, but are not limited to:

Financial Ties

Bank accounts, investments, primary source of income, business interests in California.

Social & Family Ties

Location of spouse, children, social organizations, religious affiliations, club memberships.

Physical Presence

Where you actually spend your time. Even a few months could trigger residency if other ties are strong.

Other Indicators

Voter registration, driver's license, vehicle registration, professional licenses, location of prized possessions.

The California "Safe Harbor" Rule

California does offer a specific "safe harbor" provision for certain individuals who leave California under an employment-related contract.

546 Consecutive Days: If you are domiciled in California but leave for an uninterrupted period of at least 546 consecutive days under an employment contract, you may be considered a nonresident.
Limited CA Presence: During this 546-day period, you cannot spend more than 45 days in California in any taxable year.
Income Limits: This safe harbor may not apply if you have intangible income exceeding $200,000 in any taxable year during the contract, or if your primary purpose for leaving was tax avoidance.

This rule is complex and has strict conditions; it's vital to seek professional advice if relying on it.

Document Your Movements

California FTB audits are notoriously detailed. They will demand extensive proof of your physical location and intent.
Use the Domicile365 App to automatically track your location and maintain an audit-ready log of your days.