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.
Hi. My son attends Ohio State University. He works on campus. In the summer he works at a summer camp in New York. I live in Illinois. He comes home for Christmas break and the 3 weeks before summer camp starts. How do I go about doing his taxes?
Thanks
Dawn
Hi Dawn,
Wow, your son is busy! That’s great! Regarding his state taxes, he’ll need to file a non-resident return to both Ohio and New York. With RapidTax application, reporting income from a non-resident state is pretty straightforward. If you (or your son) have further questions, please don’t hesitate to reach out to the RapidTax team!
what if i live in and work and go to college in washington but i live in oregon 6 months out of the year and dont work
I lived and worked in Utah last year until April 22, 2014 then moved to California and did not work. How do i file my taxes because i do them myself online but don’t know the right way with two states.?
Hi Melissa,
Along with your federal return, you will need to file a part year state resident return for Utah and one for California. Next year, you will only need to file a resident state tax return for California.
I would like to be a resident of both Missouri and Minnesota. I was born and grew up in Missouri and lived there 27 years (1952-1979). I own a house in Missouri (purchased 2004) and my parents live there. For the past 30 years I lived in Minnesota where I also own a house. My tax returns have been in Minnesota the last 30 years. My children are homeschooled. If I can be a resident of both states my kids would be able to pay instate tuition at University of Missouri and/or University of MN. (I pay property in both states.)
How can I avoid having to pay taxes in both states?
Also if If my daughter wanted to go to a school in a different state – could she be considered a resident of that state if she had a summer job in that state, filed a tax return in that state and perhaps got a drivers license in that state.
Since she is home schooled and I’m retired, it’s possible that she might not live in one state for longer than two months in a year? Does this give me or her any flexibility in picking even a different state as our residency (even if we were there only two month) especially if it was the state where we lived the longest that year.
Also is their any limit to the number of states
Hi Irv,
Unfortunately, each state has their own set of guidelines for residency. I suggest checking the government websites for each state that you are considering. Also keep in mind that if you are a resident of a state, you are responsible for taxes of that state (unless it is one of the states without an income tax). In other words, you cannot avoid paying taxes in a state that you are a resident of.
Hello,
I immigrated to US with Green Card in 18th of June, 2014 and settled in CA and family joined me after a month.
I got a job in Florida and moving there 1st week of December, 2014. I leave in CA less than 184 days. Family stays in CA till the July 2015. I have address assigned in CA and bank account. I never worked in CA. Wife got a seasonal work in CA since middle of Nov. 2014.
Quest:
How I need to fill in my taxation for 2014?
What I need to do for only Florida taxation during 2015?
Your detailed answer is appreciated.
Thank you.
Alex.
Hello Alex,
To answer your questions,
1. I suggest checking with the California state government website since each state has their own set of guidelines when it comes to residency.
2. Florida does not have income tax, therefore you will not need to file a state tax return. You will only need to file your federal tax return.