Before you start

An SSN or ITIN
Form W-4 with your employer for federal withholding
California Form DE 4 for state withholding
Records of foreign income and foreign financial accounts

Step-by-step

1
Complete the W-4 and DE 4 on day one
These set your federal and California withholding. California uses its own DE 4 rather than relying on the federal W-4, and the defaults can under-withhold badly for a two-income household.
Via employerWho: YouFirst week of employment
2
Determine your US tax residency
The substantial presence test counts weighted days over three years to decide whether the US taxes your worldwide income or only US-source income. Some students and scholars are exempt from counting days for a period. Your visa does not decide this.
OnlineWho: You
3
Check for a tax treaty — and know California ignores it
The US has treaties with around 70 countries that can exempt or reduce tax on specific income. California does not follow federal treaty exemptions, so income exempt federally can remain fully taxable by the state. This catches academic and research arrivals every year.
OnlineWho: You
4
File federal and California returns by 15 April
The tax year is the calendar year. Federal and state are separate filings though software handles both. An extension moves the filing deadline, not the payment deadline.
OnlineWho: YouBy 15 April annually
5
File an FBAR if foreign accounts exceed $10,000
Aggregate foreign account balances over $10,000 at any point in the year trigger a FinCEN filing, separate from your tax return. A normal current account at home is enough to cross it.
OnlineWho: You
6
Budget insurance as a tax-like fixed cost
If you buy, check the property's fire hazard severity zone and get an insurance quote before you make an offer — in some LA neighbourhoods the FAIR Plan is now the only option and it is expensive with narrow cover. If you rent, a renters' policy is cheap and worth having.
OnlineWho: You

Documents you’ll need

Form W-2 from each employer, issued by 31 January
Form 1099s for freelance, interest and investment income — common in an industry town full of contractors
Passport and travel history for the substantial presence day count
Foreign account statements for FBAR reporting

Things most newcomers don’t know

The January 2025 fires changed the insurance market structurally.

The Palisades and Eaton fires drove insurers to restrict or withdraw from parts of the LA basin, pushing more households onto the California FAIR Plan, the insurer of last resort. FAIR Plan cover is narrower and costlier than a standard policy, and often needs a supplementary 'difference in conditions' policy alongside it. Check insurability before you commit to a property.

Source: California Department of Insurance — FAIR Plan

SDI became uncapped on 1 January 2024, and it is a real pay cut.

State Disability Insurance used to stop at a wage ceiling; it now applies to every dollar at 1.3% for 2026. On a $400,000 salary that is over $5,000 a year that older comparisons — and most 'California vs Texas' calculators — simply omit.

Source: California EDD — contribution rates and withholding schedules

California does not honour federal tax treaties.

Income exempted federally by treaty is generally still taxable by California. Students and researchers who correctly claim a treaty exemption on their federal return are routinely surprised by a state bill on the same income.

Source: California Franchise Tax Board — nonresidents and part-year residents

Freelance income is the local norm and it changes your filing.

The entertainment industry runs on short contracts, loan-out companies and 1099 income. If you are paid as a contractor you owe self-employment tax and quarterly estimated payments, neither of which an employee ever thinks about. Set money aside from the first cheque.

Source: IRS — self-employed individuals tax center

Common mistakes to avoid

Ignoring the DE 4 and relying on federal W-4 defaults, which under-withholds for California.
Assuming a federal treaty exemption also applies to California — it generally does not.
Using a salary calculator that predates the uncapping of SDI on 1 January 2024.
Taking freelance work without setting aside self-employment tax and quarterly estimates.
Buying a house in a high fire hazard zone without checking insurability first.

Some of this may be out of date. Spotted something inaccurate? Help us keep it right for the next newcomer.

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