Does California still tax me after I move back to Europe?
Short answer: California will stop taxing your global income once you break residency and domicile. However, California taxes all income with a 'California source,' including RSUs that vested while you worked in the state, even if you are now in Europe. To stop being a resident, you must clearly establish a new permanent home (domicile) abroad.
Written and reviewed by Anthony Walsh, Selanis. Last reviewed 2026-10-06.
Why it works this way
California uses the concept of 'domicile'—the place you intend to return to. If the FTB believes your move to Europe is temporary (e.g., you kept your CA house, car, and voter registration), they may argue you are still a California resident and tax your worldwide income. Breaking domicile requires 'severing ties' with the state.
The 'Safe Harbor' rule (Section 17014(d)) provides some protection for individuals leaving for an employment-related contract of at least 546 days. However, this is often designed for US citizens moving abroad; for Europeans returning home permanently, the focus is usually on the fact that your 'closest connections' have shifted to Europe.
Trailing RSU taxes are the most common surprise. California taxes RSU income based on the ratio of work days spent in California during the vesting period. If you vest $100k in RSUs after moving to France, but 50% of the vesting period was spent working in San Francisco, California will expect tax on $50k of that income.
The expensive mistake: Leaving 'traces' of California residency behind
Keeping a California driver's license, staying registered to vote in CA, or keeping a 'mail drop' address at a friend's house in Palo Alto can all be used by the FTB to argue you never truly left. When you move, you should cancel these ties and register with your new local authority in Europe.
What to do
- Sever all 'indicia' of California residency — Cancel your CA driver's license, voter registration, and local memberships. File a final part-year resident tax return (Form 540NR).
- Calculate trailing RSU exposure — Work with your payroll department to ensure they correctly track and withhold California tax on future vests earned while you were in the state.
- Maintain a residency file — Keep copies of your European lease, utility bills, and local registration to prove to the FTB that your move was permanent and your domicile changed.