With Disney, beautiful beaches and no income taxes, Florida seems like heaven on Earth!
But what if you live in Florida but travel to a neighboring state for work? Well, working in a state with an income tax while living in Florida means you’ll have to pay taxes to the state you earn your income from.
For Florida residents, working in a bordering state such as Georgia, Alabama or Mississippi, you’ll have to pay tax only on the income you received there. To report this, you will file a non-resident return for the state you work in when filing your taxes.
I Live in Florida and Work in Georgia
According to the Georgia Department of Revenue website, non-residents who work in Georgia or receive income from a Georgia source…
“…are required to file a Federal income tax return and required to file a Georgia income tax return… If you are a legal resident of another state, you are not required to file a Georgia income tax return if your only activity for financial gain or profit in Georgia consists of performing services in Georgia for an employer as an employee when the compensation for services performed does not exceed the lesser of five percent of the income received in all places during the taxable year or $5,000.”
That means if you have income from a job, rental income, income from entities (trusts, estates, partnerships, s-corporations, LLCs) in Georgia, then plan on filing a non-resident tax return for the state and pay Georgia taxes for that income.
Georgia Income Tax Rates (single filers):
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1% on the first $750 of income
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2% on income between $751 and $2,250
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3% on income between $2,251 and $3,750
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4% on income between $3,751 and $5,250
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5% on income between $5,251 and $7000
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6% on income over $7,000
Georgia Income Tax Rates (joint filers):
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1% on the first $1,000 of income
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2% on income between $1,001 and $3,000
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3% on income between $3,001 and $5,000
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4% on income between $5,001 and $7,000
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5% on income between $7,001 and $10,000
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6% on income over $10,000
I Live in Florida and Work in Alabama
If you’re a Florida resident but travel to Alabama for work, you are liable to pay Alabama taxes on the income earned in the state and file a non-resident return for Alabama. According to Alabama’s website, you must file a non-resident Alabama return…
“If you received taxable income from Alabama sources or for performing services within Alabama and your gross income from Alabama sources exceeds the allowable prorated personal exemption. Nonresidents must prorate the personal exemption. If your Alabama gross income exceeds the prorated amount, a return must be filed.”
Alabama Income Tax Rates (single filers):
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2% on first $500 of income
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4% on income between $501 and $3000
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5% on income over $3000.
Alabama Income Tax Rates (joint filers):
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2% on first $1,000 of income
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4% on income between $1,001 and $6,000
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5% on income over $6,000.
I Live in Florida but Work in Mississippi
Florida residents traveling to Mississippi will have to file a non-resident return for Mississippi. According to Mississippi’s website , non-resident filers must;
“Include all income on your Mississippi non-resident return. If you perform services partly in and partly out of the state, only the wages you paid for the services performed in Mississippi are subject to Mississippi income tax. The W-2 forms issued to you from your employer(s) should indicate the state in which the wages were paid, along with the wages you earned in that state.”
Mississippi Income Tax Rates (single filers):
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3% on first $5,000 of income
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4% on income between $5,001 and $10,000
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5% on income over $10,000.
Filing a joint tax return for Mississippi? The rates will remain the same.
Avoid confusion and file with RapidTax
Interstate taxation can get confusing, especially if you live in a state without an income tax, like Florida. The general rule of thumb is that you will have to file a non-resident return in the state you worked in but did not live in and report only the income earned in that state.
If you’re a Florida Resident, you’ll need to file your federal taxes. If you worked in states outside of the Florida lines, don’t forget to file a non-resident return for those states.
I have just moved to California and desperately need help with tax. Could you recommend a specialist as I am petrified of making a mistake,
Thanks so much
Hi Karen,
If you’re looking for guidance when filing your tax return, you can use our website, RapidTax.com. We offer several packages that are based on specific tax situations. You may be interested in our CPA Review package. With this, you’ll be able to work one on one with one of our accountants. They will review possible credits and deductions that you may be entitled to. You can check out our Pricing Page. If you have any questions about our services, feel free to reach out to our customer support team via phone, live chat or email.
Hello,
If I am a full time W2 employee of a California company, but I work remotely and Florida resident, will I be subject to CA tax?
Hi Felipe,
Generally speaking, you are only subject to state income tax in the state where you reside and physically work to earn an income. In your case, this is Florida (which does not have any income tax). That being said, you’ll want to check your pay statements. If you are having California tax withheld from your paychecks, you can claim that money back in the form of a state refund. You’ll just need to file a non-resident state tax return for California to do so.
My permanent address is in PA. I rent a place and work in Georgia for the next two years. Who do I pay taxes to? Thank you!! Do I need to get a Georgia License?
Hi Connor,
Residency guidelines vary by state so you may want to check with your state’s revenue department. Also, whether or not you have a GA drivers’ license does not affect your state residency for tax purposes. You may be required to get one, though, according to the state of Georgia in general after a certain amount of time living there.
However, as far as basic guidelines go, you are a resident of a state if that’s where your main home is located for the entire tax year. It’s the state where you intend to live when you return from your business trip.
For tax purposes, you are a nonresident of a state if you
– Temporarily lived there (with no intention of making it your home), or
– Didn’t live there during the tax year and received income from that state because you:
– Worked there,
– Received income from sources located in that state, such as rental property, or
– Received income from sources located in that state as a beneficiary of an estate or trust
Im a resident of Florida and work from my home in Florida for my Alabama based employer. Ive only been to the Alabama office 5 days this year. My employer insist on withholding Alabama tax. When I file a non resident Alabama tax return will I only be liable for tax on those 5 days of pay while I was in Alabama and therefore receive the bulk of my paid taxes back as a Alabama refund?
Hi Donald,
Employers will sometimes withhold from the state where they are headquartered even if the employee works remotely from a different state. Based on what you have stated above, you are not liable for Alabama state taxes. Depending on Alabama’s rules, you may not even be liable for those 5 days. Each state has slightly different laws regarding tax liability. After filing a non-resident return for Alabama, you will receive a refund for the taxes you paid unnecessarily throughout the year.
I moved from GA to PA in Nov of 2014, I have only worked in lived in PA for 2015. I work for the same employer and they adjusted my work site and home address in 2014 for Nov and DEC, however a glitch resulted in my first paycheck of 2015 reverting to my GA address and work site, they fixed it in time for the 2nd paycheck but I still received a W-2 for Georgia with money withheld and showing income earned in GA the amount of my first pay period. PA has taxed me the full amount of my 2015 earnings and rightfully so, my question is how do I file to get my full amount back from GA since I did not live or work in GA in 2015?
Hi Ray,
This is a common occurrence when employees update their addresses. The solution is pretty simple though so you’re in luck!
Along with your federal tax return and resident state tax return, you will also file a non-resident tax return for Georgia. After submitting to the state, your tax will adjust accordingly and you should receive either a refund or credit for the amount that was withheld for Georgia.