Working in one state and living in another
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Anonymous
| How do you deal with that. The one you live in foes not have income tax the other does. |
Anonymous
| It varies from region to region. In the DC area, you pay income taxes where you live. In New England, it's where you work. You need to get advice from a local. |
Anonymous
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Pretty much everyone in this area deals with that no? Tons of people work in DC and live in VA or MD or some variation of this.
Normally you pay the state where you work unless there is a reciprocity agreement. Wehre do you live and where do you work op? |
Anonymous
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I have done this several times. I did the taxes once myself, but other years hired an accountant (one year I worked in three different states - it just became too much!) If I remember correctly, I paid taxes on my paycheck earned in NY, but then owed them in CT (where I lived). Somehow, the taxes I paid to NY were "refunded" to CT. I can't remember how it worked, but all I had to do was submit the paperwork. Also, taxes in CT were lower, so I received a refund as well. |
Anonymous
| Op here. Living in Nevada and working in Arizona. Thanks, |
Anonymous
Not op but curious WHY DC would agree with this arrangement. It has nothing to win and I guess it actually loses a lot since probably good part of its workforce lives in VA or MD, no? So, why did DC agree with this? |
Anonymous
I don't think that DC had much bargaining power--if MD or VA didn't like what DC proposed, they could convince Congress to overturn it pretty easily. |
Anonymous
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This should be moved to Money/Finance board where you would get a lot more traffic.
I am curious about this question though... |
Anonymous
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This question should be easily addressed under Turbo Tax. Or even H&R Block in NV.
Asking people in the DC area, where we have reciprocity agreements with multiple states and pay state (or DC) income taxes based on our state of residence, might not be the most accurate source of information. |
Anonymous
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In DC it is because congress forbids it. Elsewhere it is all about residency vis a vis where taxable income is earned. That is why Nevada and Florida have 181-dayers, as they are called. In Florida's case, you have New Yorkers who spend 181 days a year in Florida to avoid paying NY tax on income that either state could claim.
It doesn't matter for W2 wages of course, because those are taxed where earned. It's K income that this applies to (and cap gains, etc.) |