1099 Contractor in Texas with a California Client: Where Do You File?
Answer
Texas taxes nothing, and California taxes you only if you work there. Living in Texas means no resident return at all. A California client does not create a California filing obligation by itself — physically performing services inside California does, and then only for that portion.
Last verified
The most common contractor worry — that invoicing an out-of-state client creates a filing obligation there — is usually unfounded. What creates the obligation is physical presence, and Texas residents have no home-state return in any case.
California publishes no de minimis day count or dollar floor for nonresidents. Any California-source wage income above the state's general filing threshold requires a nonresident return, and that threshold is reset each year — check the current figure on the California Franchise Tax Board nonresident instructions before filing.
What you file
- 1Nonresident return · CaliforniaForm 540NR
File a California nonresident return only for income from services you physically performed in California. Texas does not tax wage or self-employment income.
The two states, side by side
| Texas | California | |
|---|---|---|
| Taxes wages | No | Yes — graduated |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Not applicable | Form 540NR |
| Credit for other-state tax | No income tax | Schedule S |
| Nonresident safe harbour | Not applicable | None published |
| Local income tax | No | No |
| Revenue department | Texas Comptroller of Public Accounts | California Franchise Tax Board |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in California and working in Texas gives:Home state only — estimated payments.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: Texas → CaliforniaWork state only
- Remote worker: Texas → CaliforniaNo state income tax on your wages
- Moved mid-year: Texas → CaliforniaOne part-year return — the state you moved to
Other Texas pairs
Questions people actually ask
I live in Texas and my client is in California. Do I have to file a California tax return?
Texas taxes nothing, and California taxes you only if you work there. Living in Texas means no resident return at all. A California client does not create a California filing obligation by itself — physically performing services inside California does, and then only for that portion.
Do reciprocity agreements help a 1099 contractor?
No. Every state reciprocity agreement in the country is an arrangement about wage withholding between two revenue departments, and a 1099 has no withholding to switch off. Whether Texas and California hold an agreement makes no difference to a self-employed filer — sourcing rules decide the answer instead.
How current is this?
The Texas and California rules on this page were last checked against Texas Comptroller of Public Accounts and California Franchise Tax Board on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- Texas Comptroller of Public Accounts — individual income taxaccessed 2026-08-07
- California Franchise Tax Board — individual income taxaccessed 2026-08-07