How To File Taxes in Two Different States

Do you carry the burden of dealing with multiple states on your tax return?

For most of us, filing a state tax return is just another step in filing a federal return. Your tax-filing software just transfers your information to your state’s return and you’re done within minutes.

But what if you moved to a different state during the tax year? What if you worked in a state other than the one where you lived? What if you worked in multiple states? Suddenly filing state taxes becomes a little trickier and it may involve filing taxes in two different states.

Basically there are three different types of state tax returns that you need to worry about:

  • Resident
  • Part-Year Resident
  • Nonresident

As a general rule, you have to file a resident tax return in the state where you lived, a part-year resident return in any state you moved to/from, and a nonresident return in a state where you earned money but didn’t live.

Preparing your Resident Return

A resident return is the return you have to file in the state where you are a resident. This return will tax you on all of your income, regardless of the state where it was earned.

For most people this is very simple – the state where you are a resident is the one where you live and work. But for people whose lives involve multiple states, the first step to filing state taxes is figuring out where you are a resident.

Every state has different requirements for who qualifies as a resident for tax purposes. You need to visit the websites of the tax authorities of the states in question to figure out where you are a resident.

You should note that there are nine states without income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. If you are resident of one of these states, you don’t need to file a resident tax return.

Preparing your Part-Year Resident Return

A part-year resident return is for people who moved during the tax year. If you were a resident of one state for part of the year and then a resident of another state for part of the year, then you need to file a part-year resident return in the first state and a part-year resident return in the second state.

A part-year resident return taxes you on all of your income for the portion of the year that you were a resident of that state. Let’s say you started the year living in Illinois. Then in July you moved permanently to New York. You would then have to file a part-year tax return in Illinois that taxes you on all of your income you earned during the first six months of the year. Then you will have to file a part-year resident return in New York that taxes you on the income you earned during the last six months of the year.

Preparing your Non-resident Return

You need to file a nonresident return for any state (other than the state where you live) in which you earned money. This nonresident return will only tax you on the income you earned in that state.

Here’s an example. Let’s say you live in New Jersey, but you work in New York. You’ll need to file a resident return in NJ. You will also have to file a nonresident return in NY and pay taxes on the income you earned there.

Worried about being double-taxed? Don’t be. When you file your state returns, you will have the opportunity to claim a credit for the taxes that you’ve already paid to another state through withholding. The states will then settle accounts among themselves.

You may also have to file a nonresident return for any state that had taxes withheld from your paycheck. Normally you only have to file taxes in the state(s) where you were a resident and where you earned your income.

But sometimes payroll departments goof up and withhold taxes for a state you neither lived or worked in. This commonly occurs when you work for a company that is headquartered in a different state than where you work. You’ll need to file a return just so you can get that money back as a refund.

File all of your state tax returns with RapidTax!

It doesn’t matter where your company is located. If you didn’t live in a state, and you physically did not work there, you don’t have to file a return there just because the company paying you is based there, although you do if they accidentally withhold taxes for that state. If this happens, ask them to stop withholding taxes in that state so you have one less return to file!

Hopefully this information will give you some basic guidance when it comes to filing state taxes. Each state tends to have their own set of rules. It is always a good idea to do further research into your resident state and the state where you work. Whether you need to get caught up on a late tax return or file a current year return, prepare your state returns on RapidTax.

RapidTax will help you file taxes in two different states.

882 Replies to “How To File Taxes in Two Different States”

  1. Thanks

    I am an Idaho resident. I was also wondering. Federal was taken out of my most recent paycheck (in Alaska) should I put aside some money for Idaho state tax each paycheck?

    I’m trying to avoid having to pay back taxes come tax time.

    -Katherine

  2. I work in Ny, but the company I work for is in conneticut. I have never been to that office or physically worked anywhere in CT. I started working in January and since my first pay check I have been paying NY state tax and CT taxes. When I emailed the office manager about my concerns she said I have to pay since the company was in CT. Today I was speaking to a colleague of mine and he stated that wasn’t true. I attempted to research the solution and found this site. If this is true, how should I go about collecting the money I already paid, and is there a particular rule or section of tax code I can reference when asking the company to stop deducting from my check. Thank you for your help.

    1. Hi Nicole,

      No you shouldn’t have to pay CT tax is you do not physically do any work there. However, since CT taxes have already been withheld, you will have to file a non-resident return there in order to claim that money back in the form of a refund (either that or they’ll transfer it to NY). I’m not sure how you can demonstrate to your employer that they don’t need to withhold CT tax. Try the instructions for the CT tax return.

  3. Hi,

    Alright so I worked in Idaho during the summer (I’m an Idaho resident) and then moved to Juneau, Alaska for school and have a job here (I transferred from the job in Idaho to where I’m working now so I’m with the same company). So I was wondering what I do come tax time when filing? Do I file for both states?

    and when I worked in Idaho I had to fill in a tax form for Idaho so tax will be taken out and I was wondering if I need to do that here in Alaska or if I should keep everything the same and have Idaho taxes taken out of my paychecks here in Alaska?

    thanks,
    -Katherine

    1. Hi Katherine,

      Alaska has no state income tax, so you don’t have to worry about that. The question now is whether you are still an Idaho resident. If you are, you will have to file a resident return on ALL of your income, both from ID and AK. If, however, you became an AK resident, you only have to file a part-year ID return that taxes you on the income you earned before moving to AK.

  4. My wife and I were living and working in Florida up until the end of May when we moved to Ohio. I got a new job, but my wife’s employer had locations here in Ohio and she was transferred to a location here so she is still with the same employer. I know how I should file, but how should she file.

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