I am using ATX and to this point have avoided filing MFS for any clients. This year I have new clients in CA and the Spouse is in the military stationed in TX. I have contacted the CA FTB, the IRS, and ATX directly but can't get a good answer. CA states that military pay earned while stationed outside CA is not taxable to CA. However, I can't find a CA form to subtract out the military wages from the CA return, they are taxable at the Federal level. The CA FTB stated that to remove the military pay, I would need to file a 540 NR which means I have to file MFS for both individuals one as 540 and one 540NR. My question is, when completing the federal returns for each individual I am completing the 8958 to split up the community property income but this does not carry forward to the 1040 so I have to enter each persons 50% of CP wages and federal withholding. My question is, what do I put in boxes 3, 4, 5, and 6 for FICA and Medicare wages and withholding? This can't be the first time this has occurred right? Any help is greatly appreciated.
