What is the source of income if a military service member's spouse works while residing in California?

The income earned by a military service member's spouse while residing in California is classified as non-California source income if the spouse is not a California resident and the income is earned from work performed outside of California. This is rooted in the concepts of state residency and the source of income in tax law.

In California, a resident is defined as someone who is in the state for other than a temporary or transitory purpose. If the spouse is not established as a resident of California, any income they earn from employment outside of California would not be considered California source income, which would be based on where the income is generated and the individual’s residency status.

While some options describe types of income related to residency and taxation, non-California source income is pertinent here because it highlights the relationship between where the work is performed and the taxpayer's residency status, making it the most accurate classification for the income in this context.