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.
Dear Tax Advisor:
For 2013 I worked and lived in WA but my permanent address in the W-2 is in Michigan due to the fact consultants are required to keep a permanent address. Technically i did not live or work in Michigan but i claim residency there for per diem purposes.
Do I have to pay Michigan any income taxes? And if so, do I pay as if I lived there (resident) or non resident?
Hi Andres,
If your permanent address is a Michigan address, you will file a resident return for Michigan and pay taxes all your income to Michigan, as a resident. You won’t have to file a non-resident return for Washington because Washington does not have an income tax.
Hi, I need a little tax help. I am trying to do my taxes, but need to know where to file my resident return and where to file my non-resident return (if it is even necessary). I moved to KY (from GA) in December of 2012 with the intent of becoming a student. If you are a student, then you are not required to claim the new state as your state of residence. I am going to start school fall of this year, but that means that I lived in KY for all of 2013 while technically being a resident of GA (due to my drivers license). When I file my taxes, which state do I list as my state of permanent residence? And which forms should I file to each state? Thanks!
Hi Wesley,
Considering you are a student, you will file as a resident of GA, meaning your state of permanent residence is GA. You will also file a non-resident return for KY, reporting your income earned from KY sources.
hello, i have lived in GA for 5 years and from jan-may of 2013 was my last of work. Then moved to FL in may 2013 and started working in june 2013 til present day. I got my W 2’s recently and in Box 15 said GA. My question is, should i be receiving 2 w 2’s one from GA and FL? will i be filing part year returns one or both states? if so, can i just go to H&R block here in FL and do it all at once?
Hi Jen,
Well the good news is FL doesn’t have an income tax, meaning you won’t have to worry about filing any state returns for Florida. Georgia does though. That means you’ll have to file a part-year resident return for GA. It also explains the W-2 question.
To file your GA part-year taxes and your federal taxes, you can do it all online anytime, by creating an account on our website and you can get started right away. In the state section, you can enter the dates you were a resident of GA and the income information. Our online application is actually designed to make situations like yours, easier when filing.
Hi, I need some tax help. I am doing my daughters taxes and I am unsure as to what to do. I figured the federal just fine but I am confused for the states. She lived in KY from Jan thru Mar and then moved to MD from April to Dec 22 and then moved back to KY. She had a job in both states so taxes were taken out accordingly. As far as residency she never voted or changed her drivers license when she moved to MD – it was still a KY license. Would this make her a part time resident of KY and a nonresident of MD or a part time resident of MD????
The state of residency is determined by whatever state you live in for the most time during the tax year, so it sounds like she was a 2013 resident of MD and a non-resident of KY. That means, she will have to file a resident return for MD (reporting all income received from both states) and a non-resident return for KY, reporting only income earned from KY sources.
Even though she never switched her residency to Maryland? Her drivers license was still for KY…..she only had a forwarding address in Maryland, stayed with friends so no rent, and worked a job for 8 and 1/2 months. I just need some clarification – I understand what you are saying
Hi,
I was a resident of CT till the end of July. My husband and I both had earned income. We moved to FL and I found a job and started to work. I know that I have to file a CT return. The problem is that I am being taxed on the entire income. I feel like I am a resident of FL the end of the year and my job in FL should not be taxed since there is no state tax. The CT form is taking income for the entire year and going to the tax table and then I have to pay 60% of the amount. I just want to make sure that is correct? thanks
Hi Wendy,
You’ll have to file a part-year resident return for CT and indicate the months you lived in CT. You’ll also report the tax you paid to CT on this return. This means you should probably expect a refund for the CT taxes you paid for the time you did not live there. It all depends on how many you claimed no your W-4, how much you made, and state taxation laws of CT. Be sure whoever you are filing your taxes with is aware you were only a part-year resident of CT and no longer a CT resident.
If CT taxes are being taken out from your paychecks, be sure to talk to your employer to have this changed since you are no longer a CT resident.
If you are filing on our website, you can contact our team and they will help you with any state issues you may be facing. Also, our tax filing system is designed to make filing taxes for multiple states less of a hassle.