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Can You Be a Resident of Two States at the Same Time?

You can be a resident of two states but you may want to avoid it.

If your life mostly involves just one state, filing state taxes is relatively simple. When your life involves more than one state, things can get complicated pretty quickly.

Everything depends on residency. It determines where you have to file, what kind of return you have to file, and how much you’ll be taxed. The problem is, determining residency is more complicated than it sounds. The states have convoluted and differing definitions of what constitutes a resident.

Generally, you can only be a full resident of one state. Most filers who spend time in two states end up filing a resident return to one state and a non-resident return to the other.

Is this even possible?

Yes, it is possible to be a resident of two different states at the same time, though it’s pretty rare. One of the most common of these situations involves someone whose domicile is their home state, but who has been living in a different state for work for more than 184 days. In a situation like this it is conceivable that you could be the resident of two states. Continue reading “Can You Be a Resident of Two States at the Same Time?”

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State Income Tax: Living in One State, Working in Another

Need to file state taxes when you live and work in different states?

Most people in the U.S. live and work in the same state, which makes state taxes pretty easy to understand – you pay taxes to the state where you live and work.

But what if you live in one state and work in another? Do you pay taxes to the state where you live? Where you earn an income? Both?!

You need to pay taxes to both. Most likely you will end up having to file a resident return in the state where you live and a nonresident return in the state where you work.

Resident return

Generally you need to file a resident return in the state where you are a permanent resident. This state has the right to tax ALL of your income, wherever it was earned. Continue reading “State Income Tax: Living in One State, Working in Another”

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How to File Taxes for a Deceased Person

Once the inevitable hits, it’s best to know how to deal with it. Let us help you with the tax side.

Death and taxes are two topics that no one wants to have a conversation about. However, they are two hurdles in life that every person is eventually faced with. Unfortunately, they can arrive together – when a taxpayer dies, there needs to be a final tax return filed on their behalf. We’ll tell you who needs to do this, what needs to be reported and how to get it done.   

Who is responsible for filing a final tax return?

A final tax return will always need to be filed after a taxpayer’s death, but who needs to do this will depend on the filing status of the deceased taxpayer on the day they passed away.

Were they married?

If the taxpayer was married when they passed away, then the IRS considers the couple to be married for the entire year for tax purposes. The surviving spouse is responsible for filing the tax return. In this case, the surviving spouse would file as married filing jointly, or qualifying widow(er) with dependent child.

If the surviving spouse plans to file a joint tax return, they are only able to do so for the current tax year in which their spouse has passed. In following tax years, they must file as qualifying widow(er) with dependent child, head of household, or single.

In order for the surviving spouse to file as a qualifying widow(er) with dependent child, specific requirements must be met. The surviving spouse must have: Continue reading “How to File Taxes for a Deceased Person”