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.
Filing as a resident in two states should be avoided whenever possible. States where you are a resident have the right to tax ALL of your income. This is regardless of where it was earned. If you are a resident of two states, you will likely end up paying more in state taxes than if you were a resident of just one, or a resident of one state and a nonresident of another.
Check the definitions
The first thing to do if you think it’s possible that you could qualify as a resident in more than one state is to check the definitions of residency. Each state has its own definition of who constitutes a resident. It’s possible that, according to the exact definitions of the law, that you aren’t actually a resident of two states.
Generally you are considered a resident if your domicile is that state, or (if your domicile is another state) you maintained a permanent place of abode in that state and spent more than 184 days there during the year.
Most state tax authorities have a page explaining what exactly constitutes a resident in their state. If you can’t find a page on their website, try checking the tax return instructions themselves. Most include a section on residency.
Make sure you aren’t a nonresident
If you only worked in a state, or lived there for a brief amount of time – in a vacation home, for example – you likely aren’t a resident. In this case, you’d only file as a resident in your normal home state. You would then file as a nonresident in the other state only if you earned money there.
Make sure you aren’t a part-year resident
If you move from one state to another during the year, you’ll file as a part-year resident in both states. You’ll be treated as a resident of each state for only the days that you lived in that state. This will help you to avoid being double-taxed. Don’t make the mistake of filing as a resident in both states if you permanently left one state and moved to another.
Exemptions for students, military personnel, expats, etc.
Most states also have exemptions for students who attend college out-of-state as well as members of the military and their spouses who often have to move from one state to another. These people are generally considered residents of their home states.
For more information about filing taxes in two different states, please refer to this blog post. And don’t forget, you can always file a return for multiple states with the help of RapidTax.
Hey, some confusion here. i lived in NY until June of last year, and have lived in PA until now, but have not been able to change my mailing address or other information over to PA yet. I received a w-2 for my old NY job, and for my PA job. The NY w-2 has my NY address on it, and my PA w-2 has my PA address on it. So do i bite the bullet and pay full residency taxes for both states?
You would be filing 2 part year resident return tax forms, one to NY and one to PA. Because you did not reside in either state for the full year and you left your initial residency state to live in another, your states can only tax the income that was earned in those states. The information that is most important when filing your part-year resident returns is what resides in boxes 15-20. Please ensure that you label the income earned and taxes withheld with the correct State that it was allocated to.
I am a full time student that goes to school in WI and has residency in WI, but I took an internship in KY that lasted over 200 days. Do I file part time residency in both WI and KY or full time residency in WI? Thanks!
You may want to file a resident return for WI and a Non-resident return for KY. This will allow you to get a credit from WI for taxes paid to KY.
Hi,
My wife and I are NYS residents and thinking about retiring to Florida after our children graduate from college in the next few years. We would sell our home in NY and purchase a “downsized” home in Florida. Additionally, as new Florida residents we would of course register our cars, get insurance coverage, obtain new drivers licences and have all banking/financial stuff done in Florida. If our children decided to stay in NY we would want to visit so we could either stay with them or take a short term rental (no ownership in NYS). It is my understanding that if we stayed in NYS for less than183 days and owned no property we would be considered non-residents and not taxed on our income, pensions or retirement distributions by NYS (none of which would be earned in NYS). I did hear however about some type of 30 day rule that might toss this all out. Obviously we would not want a visit to our children in our former home state to trigger a tax liability. Could you clarify how this works?
Thank you
Hello Gary,
You do not have to worry about being considered a New York Resident as long as you are not maintaining living quarters (domicile or permanent place of abode) in New York for more 183 days. The 30 day rule is part of a residency exception which applies to you if your domicile (permanent home) is in New York but spent less than 30 days in New York. Since your domicile will be in FL, the 30 day rule does not apply to you. New York State. Thank you.
Hello, I need help! I’ve been a NYC resident all my life but moved to Oregon in late August for school. I am a full time student. I have an address here (Oregon) and state ID. Do I file as a partial resident or as a resident of NY? If in NY, should I use my NY address to file both returns? I still have a home there and a bank account that uses that address. Please help, I’m very confused and there seem to be extra NYC taxes that I must pay if I file as a partial resident. Thank you!
Hi Annette,
Based on what you have stated above, you are a part-year resident of NY and OR. If this is the case, you would file a part-year resident return for NY and also one for OR. With each, you will report the dates you resided in each out of the year. You will then be taxed according to that. According the the Oregon Government website,
You are considered an Oregon full-year resident for tax purposes if all of the following is true:
– You think of Oregon as your permanent home.
– Oregon is the center of your financial, social, and family life.
– Oregon is the place you plan on coming back to when you’re away.
You’re still considered to be an Oregon resident if you temporarily move out of the state and then move back again.
My wife is a travel therapist and works in NH where there is no income tax and lives there 5 days a week and I live in ME. How would we file taxes? Does she have to pay Maine state income tax due to not living in state majority of the time.
Hi Evan,
It is common for married couples in your tax situation to file a joint federal tax return but separate state tax returns. This still allows you to receive the tax benefits of filing a joint return but doesn’t hold you each responsible for taxes in a state where you neither live nor work. You will each be individually responsible for your state tax liability.