If You Work Remotely Where Do You Pay Taxes?

Posted by on October 27, 2016
Last modified:
If you work remotely, you may be unsure where to pay taxes if the company is located in a different state than where you live.

You work from home…but where do you pay taxes?

In our post “Living in One State, Working in Another“, we explained how to file state taxes if you work in one state but live in another.

However, with all the (exciting) advances in technology, more and more individuals are trading in their commutes to the office to instead work remotely from home.

If you work remotely and the company you work for is in a different state than you live in, then your tax situation will differ from someone who physically travels to another state for work.

We understand that you may have no idea how to file your state taxes. We’re here to help!

File taxes to one or two states?

Depending on your specific tax situation, you may need to file two state tax returns; a resident return and a non-resident return.

As a refresher:

  • resident-state: the state where you live. Your resident state taxes ALL of your income, regardless of what state it’s earned in.

  • non-resident-state: a state you did not live in over the past year. Different states have different non-resident tax laws on who is required to pay non-resident taxes.

Although certain states have varying non-resident tax laws, generally, if you live in one state and work in another remotely (so you don’t physically travel to another state for work), then you would only file and pay taxes to your resident state.

That means, if you’re working remotely you’ll only have to file a resident tax return to the state you live in.

However, if your W-2 form (that form you receive at the end of the year or beginning of January) lists a state other than your resident state, then you’ll need to also file a non-resident tax return to the state listed. In other words, you’ll file two state tax returns; a resident return to the state you live in and a non-resident return to the state listed on your W-2 (the state your company is located in).

Report ALL earnings on your Resident Tax Return!

The most important thing to keep in mind if you work remotely is that you’ll need to report your income earned (no matter what state it’s from) on a resident state tax return (unless of course, you live in a income tax-free state).

For example, let’s say you work remotely from your home in New York for a company located in California. When you receive your W-2, you see that there’s no reference to CA withholding. In this case, you would not have to file or owe CA state income tax. You’d report all of your income earned from your remote work (and any other earnings) on a New York resident state tax return.

Here’s another example- If you’re working remotely from your New York home for a company in California and receive a W-2 form with two states listed, both NY & CA, then you’ll also need to file a CA non-resident tax return. On this non-resident return, you’ll report only the information  listed on that W-2 form.

If you end up being double-taxed, your resident state entoitles you to a credit for the taxes paid to the non-resident state. This should be a dollar-for-dollar reduction.

Who Doesn’t Need to File a State Return (income tax-free states)

You’re off the hook from filing a resident tax return if you live in one of the following income tax-free states;

  1. Alaska
  2. Florida
  3. Nevada
  4. New Hampshire
  5. South Dakota
  6. Tennessee
  7. Texas
  8. Washington
  9. Wyoming

So, if you work remotely from your home in Florida, you won’t need to file a resident tax return. In fact, you probably won’t need to file any state tax returns, unless your W-2 form indicates another state’s tax withholding.

Let us do the state calculations for you.

We know that state taxes are a lot to wrap your head around. Rather than trying to figure out what you owe, we’ll do all your federal and state calculations for you at once. You’ll simply enter the information listed on your W-2 form(s).

Calculating state taxes can be a headache- avoid all tax headaches with RapidTax!

If you work remotely for your employer, file your taxes with RapidTax to avoid a headache.

Tags: , ,

This entry was posted on at 2:36 pm and is filed under State Taxes | Blog, Tax and Life Changes | Blog.

355 Responses to “If You Work Remotely Where Do You Pay Taxes?”

  1. Deborah Pendarvis says:

    Recently, my husband and I received a notice of $66,000 income taxes (including penalties and fines) due to the State of New York. In fact, we received an unsolicited PTR Administrative Offices indicating the there has been a tax lien filed against us in the same amount shown in the communication from the New York State Department of Taxation.

    Neither my husband nor I have ever lived in the State of New York. In addition, with the exception of going through an airport in the 1970s, we have never even visited the State of New York.

    For the years 2007-2014, my husband taught two online classes each year for a New York state college. The total amount he earned each year was less than $6000. I started teaching online for a private college in New York in 2010 and have had gross income each year of about $10,000.

    Each of us has a home office where we perform our online class work. Since we perform the work in our home offices, we assumed the amounts were taxed in the state we performed the service — which happens to be the same place we live. So, we included the amounts in our state income taxes for the State of Georgia where we lived for the years 2007-2009. However, we moved back to Florida in mid 2009. Since Florida does not assess income taxes, we have not filed a state income tax return for the years 2010-2013.

    In my research, it appears that some states–including New York—are taxing non residents for monies earned from sources in New York. Here is a link to an article I found: http://www.journalofaccountancy.com/Issues/2009/Jun/20091371

    Have you had any experience with this type of issue? The colleges did not provide their online part time faculty with an office or any location to perform the work.

    • Tax Advisor says:

      Hi Deborah,

      What it should ultimately come down to is where taxes are being withheld from on each of your pay checks/statements. Before you file taxes each year, your employer(s) are required to provide you with a W-2 Form. On this form, the states that have been withholding taxes from your paychecks each pay period are listed in Box 15. The states listed are the ones that you are responsible for filing state tax returns for (along with your resident state). Keep in mind that you will not see any states here that do not have an income tax (ie: Florida).

      Unless yours is a specific case or there is a piece of the puzzle missing, I do not see how the notice you and your husband have received could be accurate. I do suggest contacting the person listed on the notice to gain some more information.

  2. Megan says:

    Hello,

    I have a bit of a twist on this situation in that I live in Maine and work remotely 4 days a week. I travel to Massachusetts (where my company is located) the other day. How should I break down the amount of tax owed to MA?

    Also, I lived in MA until April of 2014 and so I am assuming all of my income up until the time I moved is taxable by MA and the remainder of the year is taxable by ME (my new resident state). Is this correct?

    Thanks so much for any insight you can provide.

  3. AG says:

    I live in MS and work remotely for a company in AL. I am still confused as to if I pay resident-state tax to MS and non-resident-state tax to AL or if this statement “Although certain states have varying non-resident tax laws, generally, if you live in one state and work in another remotely (so you don’t physically travel to another state for work), then you would only file and pay taxes to your resident state” applies to me. Thanks for your help.

    • Tax Advisor says:

      Hi AG,

      That was stated in the article because each state has their own set of guidelines when it comes to residency. For a full set of rules for MS, I suggest checking their government website.

  4. Gary says:

    We moved to New Jersey at the beginning of the year and we are renting a home here and renting out our home we own in Ohio. My wife is working remotely in New Jersey for her company that is based in Ohio. Her employer recently asked which state they should be withholding taxes for and I’m also not sure which state tax returns we will have to complete? Thanks for your help, much appreciated.

    Gary

    • Tax Advisor says:

      Hi Gary,

      Typically once you are a resident of a state, that state’s taxes will be withheld from your paycheck. If you work in a different state than you live, then that state can also withhold taxes. However, when working remotely, generally the state where you are a resident is the only state that can withhold taxes.

  5. Derek says:

    Hi,

    Could you comment on the “convienence vs necessity” clause specifically as it relates to NY taxes on telecommuters. As the poster above mentioned it appears that NY is taxing people who work from home from other states for NY employers if the job theoretically could be done in NY.

    My wife and I moved to CA this year. She continues to work for her NY company from home. Her CA W-2 shows a part year income. Her NY w2 shows an entire years worth of income though her company had not been taking out NY income tax for half the year. It seems like we will owe NY state taxes and have to take a credit in CA. Am I missing something?

  6. Anna says:

    Hi!

    I live in California and the company I work for is located in New York. I also might be moving to different states/countries and working from there temporarily. I am given a choice of being on W2 or 1099. Could you please explain what the PRO’s and CON’s of each approach are in this case?

    • Tax Advisor says:

      Hi Anna,

      Employers tend to ask this question (usually) hoping that the employee will choose to receive a 1099. The main difference is that with a W-2 form, one is considered to be an employee and with a 1099, one is considered to be an independent contractor. If you receive a 1099 at the end of the year, that means that you received un-taxed income from your employer throughout the financial year. However, you are still responsible for reporting that income and paying the income tax due to the IRS. You will also be subject to an additional self-employment tax. If you choose to receive a W-2 form, you will be asked to complete a W-4 at the start of employment. This will determine the amount of tax that will be withheld from your paychecks throughout the financial year. The amount withheld will be used to cover the tax owed to the IRS.

      All in all, receiving a 1099 is tempting since you are not taxed throughout the year. However, speaking long term, it may not be the best decision since you are still responsible for the income tax owed to the IRS after filing. Receiving a W-2 form may seem more limiting, however, it regulates your paychecks so that you are not subjected to paying the IRS a large lump sum come tax time.

  7. karen says:

    I recently moved to AZ. I currently work for a company that is in Texas. I was trying to see if the company is taking out a different amount since I live now in a different city. Should I have to pay state taxes here? And should I expect my employer to pay me based on TX rules or AZ rules?

    • Tax Advisor says:

      Hi Karen,

      As addressed in the article, it does not matter where your company is headquartered. You are responsible for taxes in the state where you are a primary resident and the state where you are physically there and earning an income. In this case, that state would be Arizona. Since Texas is an income tax-free state, you were not having taxes withheld prior to moving to AZ. Now that you live in an income taxed state, you are responsible for taxes there.

  8. Ace says:

    Hi,
    I am working remotely from my home in Seattle,WA for an employer in California. Since there is no state tax for WA but i am paying income tax for CA as my employer is based there. I have never lived in CA. So how does this affect my returns? Will i get any credit since i am a non-resident for CA.?

    Thanks,
    Ace

    • Tax Advisor says:

      Hi Ace,

      That is correct. Since you are not a resident of CA or working and physically earning an income there, you will file a California non-resident state tax return along with your federal tax return. This allows you to claim back the tax you ended up paying for California from your paychecks.

      • Molly says:

        In this situation would you get all they money back? I have same situation. I work from home in south Dakota (where there is not state tax) but the company I work for is located in Nebraska. When I file a non-resident return would I get all or part of that money back that was taken out for Nebraska state taxes?

    • Gaurav says:

      Hi, I am in a little bit different situation. We were there in IL up until end of June 2015 and then moved to Texas and working from home office. My employer continued paying IL taxes from my paycheck for the whole year in 2015 (and still continue in 2016). My W2 shows IL in item#15 and respective taxes. Two questions for you.

      1. Will we get tax refund to IL that we paid from July’15-Dec15 once we will file IL tax return (part time resident)
      2. Does this seem correct to you that my pay check in January 2016 still shows IL taxes?

      • Tax Advisor says:

        Hi Gaurav,

        This can happen sometimes when employers do not update your records on their end. When you file a part-year IL state tax return, you will be asked to provide the time frame you lived in IL. Once you do this, your taxes will adjust accordingly. Although this will update your information with the state and the IRS, it does not mean that your company will have updated your records. Make sure to speak with your employer as well. They should have your new address on file and an updated W-4 as well.

  9. John says:

    What is the situation if I am Canadian working remotely for an American company?
    The company is located in NC and my residence is in Ontario, Canada.

    Thanks

    • Tax Advisor says:

      Hi John,

      Based on the information you have provided, you will most likely need to file a 1040 NR (non-resident) reporting your US income along with a Canadian return reporting your US income and any Canada income you are earning.

  10. Matthew says:

    Hello,

    I am currently working for a company in NYC, I am moving to south dakota for personal reasons but will continue to work remotely (for convenience) for my employer based in NYC. I assume that means I will be liable for all taxes in NY state, NY City and federal?

    Thanks

  11. Russell says:

    I live with my wife in CA. I work for a Singapore company where I often pay tax in Australia. Can i get exemptions from the amounts I pay tax on in Australia for state and federal tax.

    • Tax Advisor says:

      Hi Russell,

      According to the IRS, if you are a U.S. citizen (or resident alien), and you earn income from another country, the same rules apply as if you were earning income from somewhere in the United States. Your worldwide income is subject to U.S. income tax, regardless of where you live.

  12. John Wlliams says:

    Hi,

    I am an US citizen living in Canada but commute to Illinois for work every two weeks. I live in Illinois for about 15 days every month.

    Do I pay Illinois state tax for the time I am in Illinois?

    Thanks,

    John

    • Tax Advisor says:

      Hi John,

      One thing to keep in mind is that each state has their own specific guidelines for when they begin holding a non-resident employee working in Illinois to become liable for income taxes. In the case of Illinois, you are liable for state tax on the first day of physically doing business in the state. You will only be responsible for Illinois state tax for the duration of your stay there. Once you are back in Canada and physically earning your income there, you are no longer liable for Illinois state taxes. At the end of the tax year, you will need to file an Illinois non-resident state tax return along with your federal tax return (and your tax liabilities for Canada). If you need any assistance, RapidTax can help with all state and federal tax returns. We also have a number of ways that you can reach our customer service team via phone, live-chat and email.

  13. Anna says:

    Currently we live in Utah. My husbands paycheck comes from a Fortune 500 company that does have offices here in Utah. I do not work. We want to move back to California. My husband is considered a permanent remote worker. If we sell our Utah home and purchase a home in California, can I move into the new California home and my husband would either rent a domicile here in Utah or come with us and work from there. We do not want to pay double taxes. What is the solution. I am willing to live separately in California until he can secure a job in California if necessary to avoid double taxes. Who do we pay taxes to? Please advise.
    Signed, confused in Utah

    • Tax Advisor says:

      Hi Anna,

      Taxes don’t always seem fair, however in a case like this, they tend to be. An employee is generally only liable for taxes in the state where they are physically working and earning an income and the state where they are a resident. In your husband’s case, as of now, he is living and earning an income in Utah. Therefore, he is responsible for taxes in Utah. Let’s say you and him so end up moving back to California. If you move mid tax year, he will need to file a part year resident return for Utah and one for California. However, from then on, he will only be responsible for California state tax. This is because he will be working remotely and physically earning an income in (not necessarily from) California as well as residing there.

      Let him know to discuss this with his employer. If his pay statements continue to show Utah state withholding, then he will just need to file a non-resident state tax return to claim the tax withheld throughout the year.

  14. Dan says:

    I live in NV (no state income tax) and work for a company in CA. I will work remotely from NV let’s say 80% of the time, and visit and work in CA 20% of the time.

    How should I, or my employer, document my time in CA vs. NV in a way that is sufficient? Do I still have the CA company withhold the CA income tax and then file the non-resident return?

    • Tax Advisor says:

      Hi Dan,

      To put it simply, you are responsible for taxes in the state where you live and the state where you physically earn an income. In your case, it is Nevada. Since Nevada is income-tax-free, you won’t need to file a state tax return. However, California is a different story. Each state tends to make their own rules regarding tax situations but at some point, you will be liable for California taxes. This will either come into effect the day you begin doing business in CA (lasting the duration of your stay) or after a certain-day threshold (usually 30 days). You can check with the CA government website page for more details on the time frame.

      Although your employer will only be withholding CA taxes from your paychecks for 20% of the tax year, you will still need to file a non-resident state tax return for CA. This is where you can report the income you earned while doing business there. You will then either be refunded or owe additional tax.

  15. Ray says:

    Hi,

    I want to establish my small business in South Dakota. It is an online immigration law firm working with clients all over the world. I’m currently working and living in China, but I am a California resident.

    My question is: Do I have to pay personal income tax in California for my online business established in South Dakota?

    Thank you.

    • Tax Advisor says:

      Hi Ray,

      As long as you are a resident of any state and are earning an income, you need to complete a state resident tax return. On your resident state tax return, you are asked to report all income earned. As long as you are earning an income with your company in South Dakota, you will need to report this on your CA state tax return.

  16. Stacy says:

    My husband works from home in Illinois. He recently started working for a company based in California, I noticed on his paycheck they are taking out California taxes both state and federal. Is this correct?

    • Tax Advisor says:

      Hi Stacy,

      If your husband is working remotely, he should not have CA taxes withheld just because the company is based there. Taxes should be withheld from Illinois. That being said, he should speak with his employer or payroll department as soon as possible. It could have easily been a mistake on their part. When it comes time to file his taxes, he will want to file a non-resident CA state tax return to claim those taxes withheld back.

  17. Dave says:

    If I live in Texas (no state income tax) and work remotely from home for a company in Maryland (state income tax), will I be required to file a MD nonresident return? Will Maryland state income tax be withheld?

    • Tax Advisor says:

      Hi Dave,

      As long as you are physically earning your income in Texas and residing in Texas, you are not responsible for Maryland state tax. Keep in mind that if you travel to Maryland and conduct business there, you are then responsible for MD state for the duration of your stay there. To determine if your employer is withholding MD state tax from your paychecks, take a look at your pay statements (it will also be present on your W-2 issued to you at the end of the year). If so, you should file a non-resident MD tax return along with your federal tax return. This will ensure that you are issued a refund for the unnecessary MD taxes that were withheld throughout the year.

  18. Phyllis says:

    Good Afternoon,
    I am a resident of Long Island, I am thinking of a taking a position with the main office in Georgia but I will be working remotely from my home with there office in Florida,

    Does that mean I pay NY State, City and Federal along with Georgia’s Federal, State and City and Florida’s City and Federal
    HELP.
    Am I working for taxes???

    • Tax Advisor says:

      Hi Phyllis,

      You are responsible for state taxes in the state that you physically reside and the state where you physically earn an income (unless that state is income tax-free). Based on your situation described above, you will not be physically working/earning an income or living in Georgia or Florida. You will be responsible for New York taxes. That being said, if you notice that your employer is withholding taxes for any other state besides New York, you will need to file a non-resident state tax return along with your NY state resident tax return and your federal tax return. You will then be issued a refund to cover those taxes that you had withheld for the non-resident state.

      Please note also that Florida is an income tax-free state so you will not have any taxes withheld from Florida.

  19. akila says:

    hi
    my husband works as a contractor remotely from Ohio, we rent an apartment in Ohio. But his client is based on Mt.Laurel, New Jersey. So his employer suggested the taxes should be withheld from both NJ as well as Ohio. So now should we file tax for both state if his W2 reflects both state. In this case will we get some return from the Ohio. Or Should we ask his employer to withheld tax only from Ohio. Is this correct?

    • Tax Advisor says:

      Hi Akila,

      As a basic rule, you are responsible for state taxes where you reside and where you physically earn an income. In your husband’s case described above, he is responsible for Ohio state taxes since he is living there and earning an income there. Keep in mind that if he travels to New Jersey to work directly with his client, that is when he could be responsible for New Jersey tax as well. He could speak with his employer about not withholding NJ tax or he could simply file a non-resident NJ state tax return along with his federal and OH resident tax return. He will then be issued a refund to compensate the unnecessary tax paid to NJ.

  20. Lori says:

    If I am an Arizona resident, and US citizen, working from my Arizona home for a company in Israel, how/where do i pay my taxes?

    • Tax Advisor says:

      Hi Lori,

      Since you will be physically earning an income and residing in Arizona, then you will still be liable for Arizona income state taxes. You will need to report your foreign income earned on your US tax return(s). I would advise that you check with your employer in Israel to confirm how to proceed in paying taxes there. Keep in mind that although you are paying taxes to the US, you may also be responsible for Israel taxes.

  21. Paula says:

    I have my permanent residency in Texas and my employer is in Texas. I am planning on working remotely (Oregon initially) for 4 or 5 months out of the year with the remaining months working back in Texas. I am a little confused as to what we need to do from a tax perspective and what is required from my company in this situation.

    • Tax Advisor says:

      Hi Paula,

      In most cases, you will be responsible for taxes in the state where you physically are earning an income and the state where you reside. This plays out the same for working remotely. Texas is an income tax free state but Oregon is not. Since you will be physically working and earning an income in Oregon, you are liable for taxes there. Your employer should be withholding Oregon taxes from your paychecks for the duration that you are working from there. If not, you will still need to file an Oregon state tax return and report the income you earned while living there.

  22. Kelly says:

    We live in TX (no state income tax), but my husband works remotely in outside sales for a company in CA. His employer is taking CA taxes out of his paycheck. I understand from your articles that we’ll now have to file a CA tax return. However, since Texas obviously won’t credit us for this (massive) tax paid to CA, where can be deduct this huge expense?

    We’re quite confused and ticked off, actually, because he has worked for several other CA companies and they did not deduct CA tax. If we’d known this before, he wouldn’t have taken the job or certainly would have negotiated his pay differently.

    • Tax Advisor says:

      Hi Kelly,

      Your husband is only responsible for the state taxes where he physically earns and income (Texas) and where he resides (also Texas). In his case, Texas is income-tax free so he will not be subject to tax there. Since his employer withheld taxes from California, he doesn’t need a credit to claim that back. He’ll just need to file a non-resident CA state tax return. However he decides to file, whether it be with Rapidtax.com, an accountant, etc., he will be asked how much income he earned in/from California. He will simply say that he earned $0 along with the amount that was withheld. This will exempt him from CA taxes and show that he shouldn’t have had taxes withheld from his income. He will receive it back in the form of a refund.

      • Kelly says:

        Thanks you so much for your reply! The situation has been weighing on us both. I really appreciate your taking the time to help alleviate some of that stress for us!!

  23. Diya says:

    Hello.

    I currently live in New Hampshire and I have a green card residence. I am working remotely for a company in Australia. Do I need to pay taxes? I am new in USA so I am a bit confused what do I need to do.

    Thank you so much

    • Tax Advisor says:

      Hi Diya,

      In the U.S., all foreign income earned is taxable. When you file your tax return for the year, you will be asked how much foreign income you earned (how much was earned from your job in Australia while you were living in the U.S.). If you have not paid tax on that income over the course of the year, you will most likely receive a tax due bill from the IRS. At that point, you will be able to either choose a payment plan or pay them the tax owed.

  24. Laura says:

    I have a Regional position with a national company that is based in Wisconsin, and I work from home in Ohio the majority of the time. Sometimes I travel to other states for a few days at a time. Will I need to file non-resident forms in every single state in which I work for a few days? This could be very interesting: I’m already up to five or six states right now.This is my first year with this position, so I don’t know how the W-2 will look.
    Thank you.

    • Tax Advisor says:

      Hi Laura,

      I understand your pain as this could get very tedious. When it comes to state taxes and residency, each state has slightly different guidelines. While some states will require you to start paying taxes the day you begin work there, others will allow a 30-day threshold until they hold you liable for taxes. You will be able to easily access this information on the Department of Revenue website for each state that you work in or contact them directly. Although tedious to research this information, it saves you from having to prepare several non-resident state tax returns when it isn’t necessary. Something that you should pay close attention to is that you should file a state return for each state you see listed on your W-2 form once you receive it. Even if you were not responsible for one/some of the states listed, you will be able to file a return and claim that unnecessary money back in the form of a refund.

  25. Rich says:

    I am currently a resident of Massachusetts but work part time in Florida which has no state tax. When I file my state tax in MA. will I need to pay taxes on my FloriDA earnings.

    • Tax Advisor says:

      Hi Rich,

      Although Florida is an income tax free state, you will still be required to report your income and pay federal tax on all of it, regardless of which state it was earned in/from. You will NOT need to pay state taxes on your FL income.

  26. Drew says:

    I work remotely in Missouri for a Florida based company and will need to file for unemployment, so I file in Missouri or Florida?

  27. Mollie Schilling says:

    I will be teaching for an online high school head-quartered in Dubai. I will be teaching from my home in NY state. They are a branch of a US company called K12. I am not sure who will be paying me but they said that I have to save my invoices since they will not be providing W2’s. How do I file my taxes. I also teach full time for a local high school and file those taxes jointly with my husband. Can I file jointly for that and then quarterly formy online work?

    • Tax Advisor says:

      Hi Mollie,

      To address your last question, you should only file one federal tax return, and one tax return per state involved in your specific tax situation. Even if you have more than one source of income, you are advised to wait until you have all of your income documents for the year before you file a tax return. However, something that you CAN do is file a joint federal tax return with your spouse and separate state tax returns. This will hold you both equally liable for the federal tax return and individually liable for each of your state tax returns.

      When it comes to your initial question, the answer is a bit more complicated. You mentioned that you are not sure who you will be getting paid from. If you are getting paid from a US headquartered company, then they should be providing you with some form of income document (ie: W-2, 1099, etc.). Based solely on the information you have provided, it seems as though your employer should withhold NY state taxes. However, I strongly advise you to contact your employer to see how they will be taxing you and if you need to consider Dubai tax laws as well.

  28. Markus says:

    Hi. I live in Kentucky. I am teaching in Cincinnati, Ohio. My employer withholds KY income tax, however, I am also paying Cincinnati city taxes, even though I do not live in Cincinnati. Should I be getting the paid city taxes back on my return?

    • Tax Advisor says:

      Hi Markus,

      Seeing as each state has slightly different guidelines when it comes to taxes, I can see where you’re coming from. However, anyone who lives or physically works in Cincinnati is liable for the 2.1% income tax regardless of their age or income amount. You can check out the City of Cincinnati government website for more FAQs that may be beneficial to you.

  29. Michele says:

    I am a resident of Texas and work remotely for a company in Illinois. I spend a few months visiting family in NY and continue to work remotely during that time. Does that mean I owe NY state income tax for that time period? Would I owe every state I travel to and stay for any extended period of time (visiting family/friends/places but continuing to work remotely) state income tax for each visit?

    • Tax Advisor says:

      Hi Michele,

      There are two different tax situations to take a look at. The first being that you work remotely from your home in a different state than where the company is physically located. In this case, you are only responsible for taxes in the state where you are a resident and the state where you physically work and earn an income. In your case, that is Texas and they are an income-tax free state.

      The second tax situation is that you travel and work from different states. One thing that is important to note is that each state has their own set of guidelines when it comes to working as a non-resident and when you become responsible for taxes there. Some states will consider you liable the very first day you begin working there while others will give a time-frame threshold before you become liable for state taxes. For instance, NY requires that anyone who comes for business must file a nonresident return for income earned from day one. But those travelers’ employers are only required to start withholding New York tax if they work in the state for at least 14 days. The smartest thing to do is to speak with your employer to make sure you’re both on the same page and that you should ultimately follow what is written on your W-2 form.

  30. Zee says:

    I moved from Wisconsin to Oregon in September, but work remotely for the same company back in Wisconsin. Do I need to file returns in both states?

    • Tax Advisor says:

      Hi Zee,

      State taxes are withheld by the state where you physically reside and where you physically work. It can get confusing when you work remotely from a different state than where your company is headquartered. However, states do not tax employees if they are not physically working or living there. In your case, you would need to file a part-year state tax return for both Wisconsin and Oregon. You will be asked to report how much of an income you earned while living/working in Wisconsin and while living/working in Oregon. In future years, you will only need to file a state tax return for Oregon (under the assumption that this is where you will be living and working from for the entirety of the tax year).

      Keep in mind that you should speak with your payroll department to ensure that they are now only having Oregon state taxes withheld from your paychecks.

  31. Ange says:

    I live in PA. The temp agency that I am considered an employee of is also located in PA and they are the ones that I receive my paycheck from. My current temp assignment is in NJ though. I am not considered an employee of the NJ company and no income I receive is from them. Do I file state taxes for both NJ and PA?

    • Tax Advisor says:

      Hi Ange,

      Although you are an employee of the agency, you are still physically working in NJ. Depending on the amount of time you will be working in NJ (each state has different rules), you will be liable for NJ state taxes as a non-resident. Temp employees are taxed the same way as permanent employees when it comes to state taxes. For example, if you were a permanent employee for State A and also lived in State A, but your employer gave you an assignment to work in State B for a good length of time, you would then be liable for State A taxes (as a resident) and State B (as a non-resident) abiding by State B law.

  32. Ron says:

    If my employer is located in Florida, but I work for that employer in Alabama, do I have to pay Alabama State Tax?

    • Tax Advisor says:

      Hi Ron,

      Yes, you will owe taxes for Alabama. You are responsible for taxes in the state where you physically work and earn an income and where you reside permanently. In this case, you are working for a company in FL which is income-tax free. if it was not, you would not be responsible for FL taxes since you do not live there or physically work there.

  33. SomeGuy says:

    I am evaluating a full time employment opportunity in NY state starting sometime in Feb 2016 and need some advice on tax complications resulting in my decision to travel back to my home state of Indiana every week end. At this time, I anticipate working in NY 4 days a week and traveling to NY on Monday morning, flying back home on Thursday night. I will be working the 5th day from home. I also have about 32 days of paid time off plus weekends where I obviously wont be in NY. In effect, I might be working around 180 days or less in NY and rest of my time will be in Indiana.
    How will my state tax status be affected by this arrangement? Will I be a resident of both states and end up paying state taxes in both states?

    • Tax Advisor says:

      Hello,

      Generally speaking, you are responsible for taxes in the state where you physically work and earn an income and the state where you reside. In your case, this would be NY and GA. It is important to know that each state has their own set of rules when it comes to when non-residents of a state become liable for state taxes; some enforcing a threshold of time before taxes are owed and some enforcing that taxes are owed the very day business is conducted. In New York’s case, they enforce the latter. You are responsible for taxes as a non-resident the very day you start working there. That being said, you’ll want to look into the rules for Indiana and Georgia.

  34. Tena says:

    I will be moving my residence to NH from NJ this year so as I understand it, I will have to file two NJ state forms in 2016: a part-time resident and a part-time non-resident.

    I will continue employment with my NJ company, spending some of my time working remotely from NH and the rest of the time traveling to the NJ office, as needed. Since NH has no state tax, the time I spend working remotely would not be subject to state income tax. However, the time I spend in the NJ would. I’m not sure how much “onsite” NJ working time will be needed. How to I handle a situation like this?

    Thanks.

    • Tax Advisor says:

      Hi Tena,

      Although you will need to report that you were a resident of NJ for part of the year, you will only file one NJ state part-year tax return. On this return, you will report the income you earned there and the time frame you resided there. From here on out, while living and working from NH, you will need to file a NJ non-resident return to report the income earned while physically working there. You will not need to file a state tax return for NH since, as you mentioned, it is an income tax-free state. ALL income earned will be reported on your federal tax return.

  35. Denise says:

    My husband and I live in Texas (actual, physical–I reside there all year–address). He works for a company that is based in Connecticut, they pay him, but the W2 has a Florida address (confused yet, because I am). When he’s not on the road, he works from home, BUT my husband travels for his job, all over the US. And it varies from one year to the next year. He spent several weeks working in CA, IL, and others, (in hotels, not permanent addresses) so do we have to pay state taxes in all those places? There was nothing on his W2 last year, in the state area (but he’d only been there a fews months in 2014). Thank you!

    • Tax Advisor says:

      Hi Denise,

      Your husband has a slightly overwhelming tax situation but a lot of the confusion can be handled by taking a look at his pay statements that he receives from his employer. These statements will show which states his employer is withholding taxes from. These are also the states that will be listed on his W-2 form at the close of the tax year. Generally speaking, he is responsible for taxes in the state(s) where he physically works and the state where he resides. That being said, each state has their own set of guidelines when determining when non-residents become liable for taxes when working in the state. For example, some states (ie: NY) hold non-residents liable for taxes the day they begin to conduct business in the state. Other states offer a threshold of time before they become liable. Just double check on the state government websites.

  36. David says:

    Just out of curiousity – what are your credentials. There are 5 states (New York, Pennsylvania, Delaware, New Jersey and Nebraska) that will subject telecommuters in other states to pay the tax of the state where the company is located. (That is – if you work for a company located in one of these 5 states, you will be subject to income tax even if you telecommute from a different state unless you’re located in that state for the necessity of the company as opposed to convenience).

    I see a number of answers here that suggest otherwise.

    • Tax Advisor says:

      Hi David,

      Thanks for your input! I appreciate your interest in getting down to the facts. As stated in the article, these are general guidelines. We completely understand and make our readers fully aware that each state has slightly different rules when it comes to taxes. Unfortunately, providing each and every state’s laws in this post would be monotonous; not to mention unbearable to read through. It is strongly suggested that each reader look further into their state guidelines for how to proceed with filing taxes if they work remotely for a company or give us a call if they are unsure.

      • Steve Angel says:

        My wife & I lived and worked in PA until mid-May of this year. We moved to AR but my wife then started to teach summer and now fall on-line classes for the college in PA where she had worked. I understand we will need to complete partial year resident taxes in both states, but I am unclear if her teaching income since moving to AR is subject to PA or AR state taxes.

  37. Katie says:

    I work remotely for a company based in California, but my employer taxes me based on my resident state, Colorado, where I resided when they originally offered me the position. However, I moved to Indiana mid-year last year, so I worked remotely from Colorado from Jan-June, and from Indiana June-Dec. My issue is that my employer taxed all my wages in Colorado as if I had resided in that state the entire year, so Colorado is the only state on my W-2. Do I need to file an Indiana state return since all of my wages were already taxed in one state? I’d essentially be paying taxes twice on the same wages if I filed in Indiana as well…

    • Tax Advisor says:

      Hi Katie,

      When working remotely from a different state than where the company is located, state taxes can be tricky. In your situation, the first thing to do is speak with your employer to update your address information for payroll so that this doesn’t happen again this year. For this year, you can file two part-year tax returns; one for Colorado and one for Indiana. On your Colorado state tax return, report the months you lived and worked there, the income you earned while in the state and the full amount of tax withheld from Colorado (even while you were living in Indiana). This will register as too much tax being withheld for the amount of time and income earned while living and working in Colorado; resulting in a refund of the difference. On your Indiana state tax return, report the amount of time you lived there with the income earned while in the state and the amount of tax withheld from Indiana ($0.00). Since no tax was withheld for the income earned and time you lived in Indiana, you will owe the state tax HOWEVER, you will have the refund received by Colorado for withholding too much tax.

      This is a lot of information so please do not hesitate to give our tax team a call at 877-289-7580 so that we can help you through the process of filing your state tax returns.

  38. Lisa says:

    If I live in FL and work as a remote energy rater for a FL based company that provides energy testing services for other states, including AL. I physically do the work, but I am not responsible for any billing or receiving any payment for these tests, my employer does all of that…In other words, no money passes through my hands. For the past 6 months I have paid in the correct FL deductions and received a FL W-2 based on where I live. I noticed on my most recent 2016 pay stub they are charging me AL withholding, didn’t move and I’m still living in FL. Am I responsible for AL withholding tax?

    • Tax Advisor says:

      Hi Lisa,

      Although each state differs slightly with their guidelines, if you are not physically working in AL, then you should not be held liable for taxes there. However, since you had AL taxes withheld from your paychecks, you should file a non-resident state tax return to be issued a refund back. On a non-resident tax return, you are asked if you spent any time in the state. Once you report that you did not, your taxes due will be adjusted.

      • Lisa says:

        Thank you so much for the answer, but I do have another question.

        I need to report the time it has taken to set up the testing equipment turn it on then back off, correct? In the past month I have spent no more than 15 hours working in the state of AL. I am now no longer working there, I am working only in the state FL. So will the 15 hours is all I will need to report on the non-resident tax return? My paychecks still continue to have the AL withholding tax deducted each week, I need to get that changed since I am no longer working in another state, correct?

        I guess I had in mind that by “physical labor” it was more like using a hammer and rebuilding something, there is no real physical labor to what I do, it is all the electronic equipment doing the real work.

  39. Ed Cummings says:

    I live in Texas. Last year I worked part time at an apartment complex in Texas, in the next city over. The owner of the complex lives in California. When I received my W-2, it showed $98.60 taken out for California taxes. When I started to file my taxes online, it was saying I owed California $780 in taxes. Is this right? Do I owe California tax money, and if not, how do I get my $98.60 back? Thanks.

    • Tax Advisor says:

      Hi Ed,

      Since you lived and worked solely in Texas without ever stepping foot in California for business purposes, you should not be held liable for California taxes. When completing your taxes online, it will depend on how the software is set up to calculate your entries. This could be the reason you are seeing such a high tax due. Try creating an account with us at Rapidtax. If you have any questions along the way, our tax team can be reached by phone or livechat to help you through the short process.

  40. Lory says:

    My husband is from Switzerland and is a dual US/Swiss citizen. He has a life insurance policy in Switzerland that he pays into every year. When it matures or when he dies (whichever is earlier) he will receive his premiums back with interest. Do we have to pay tax on this?

    • Tax Advisor says:

      Hi Lory,

      Typically, if you receive the proceeds from a life insurance policy as a beneficiary due to the death of the insured person, the benefits are not included in gross income and do not have to be reported. However, any interest you receive is taxable and you should report it just like any other interest received.

  41. Matt says:

    I live in South Carolina and work from a home office. We moved down here in Oct 2014 from New York. My 2015 W2 has my correct and current address listed but the employer ID number listed is NY and i have paid NY state income taxes all year.

    Do i file two state returns this year (1) claim NY as a non-resident and (2) South Carolina as a resident?

    • Tax Advisor says:

      Hi Matt,

      In the tax year that you moved from NY to SC, you would have filed two part-year resident tax returns (one for NY and one for SC). This year, however, you should only need to file a resident SC tax return. Since NY withheld taxes, you can file a non-resident NY state tax return. You should be issued a refund for the tax withheld while you were not physically earning an income in NY.

  42. Tom says:

    I got married this year and would like to file taxes married filing jointly. My wife and I lived in Washington DC together until she moved to Tennessee in July for 1 year for a fellowship. We both worked in DC (she for 6 months, me for the entire year). Her permanent residence at the end of the tax year was Tennessee and mine was Washington DC. Tennessee does not have any state income tax and she therefore did not have any state taxes withheld. How do we file our state returns? More specifically, do we need to pay any Washington DC “state” income tax on the income she earned while working and living in Tennessee (i realize she will need to pay DC taxes on the income she earned while working in DC)?

    • Tax Advisor says:

      Hi Tom,

      Congratulations on getting married and welcome to claiming multiple tax benefits for doing so!

      Now, for your taxes, it is common in a situation like yours to file a joint federal tax return and separate state tax returns. Your filing status will still be married and you can still reap the benefits of filing a joint tax return. It will just be less confusing. If you do this, your wife will file a part year resident tax return for DC. She would usually need to do the same for the state she moved to but since Tennessee has no income tax, she won’t need to. You will file a resident state tax return for DC. These will be filed along with a joint federal tax return.

  43. Nia says:

    My husband and I live in Nevada but my husband’s work for Feds is in California, not remotely, he actually drives there for his shift. I live and work in Nevada. It said we need to put my income for his tax filing for California because we file jointly for Federal. The amount we owe goes up when my income is added. This does not seem right that my Nevada residency and income should be counted on how much we owe California. His income I understand. Any advise??

    • Tax Advisor says:

      Hi Nia,

      It is common for married couples in similar tax situations to file a joint federal tax return while filing separate state tax returns. This will allow you to qualify for tax benefits federally while still only remaining responsible for your own state taxes; independent from each other.

  44. Rich says:

    My daughter lives in Colorado (since mid 2015) but works remotely for a company in NYC since October 2015. The company has taken NY state and city income tax out of her pay checks. Reading some comments here it seems that she shouldn’t be paying taxes in New York. Correct? She does fly into New York 2 or 3 times a year for 4 or 5 days of meetings and training. Also, if she does file in NY does she need to also file in Colorado? And would she have to also pay taxes to the State of Colorado?

    Sincerely appreciate your comments on this.

    • Tax Advisor says:

      Hi Rich,

      If your daughter is working remotely from Colorado, she is responsible for Colorado state taxes. The only time she would be liable for NY state and city taxes is when she is physically there working (as mentioned in your comment above). She’ll need to file a Colorado resident return and a New York non-resident return.

  45. Daniel says:

    Hi there,

    I have somewhat a complicated situation. Until the end of June 2015 I worked in Massachusetts and my employer (from DC) was doing of the withholding for the state. But in the beginning of July 2015 my office there was closed, I became a remote employee and moved to New Hampshire. Unfortunately my employer continued paying taxes to the state of MA for the rest of the year. How do I file that and how do I assure that State of MA gives me the tax return for the amount paid between July and December?

    Thanks a lot!

    • Tax Advisor says:

      Hi Daniel,

      You will file a Non-resident state tax return for MA. On a non-resident state tax return, you are asked to provide dates of when you worked there and the income you earned from that compared to how much of your income was withheld from the state. Once you fill this information out, your tax liability will adjust accordingly. You should receive a refund for the tax you paid when working remotely.

  46. john says:

    I live in new york, but was working for my home office as an independent contractor for a company in california. All my work were performed on the computer and over the phone in NYC. There was no withholding on 1099. Would I need to file CA state tax?

    • Tax Advisor says:

      Hi John,

      As a general rule, if you work from home, you are required to pay state taxes in the state where you reside and work, not the state where your company is headquartered. There are a few exceptions to this rule, however, CA is not one of them,

  47. Deep says:

    I am resident in TN and work in KY,I am a 1099 (independent contractor).Do I need to pay KY state tax?

    Thank You.

    • Tax Advisor says:

      Hi Deep,

      You are responsible for taxes in the state where you live and physically work. In your case, TN is income tax-free so you will not need to pay taxes to your resident state. You will need to file a non-resident KY state tax return.

  48. Shashank Srivastava says:

    Hi,

    I am currently living in Rhode Island and working in Rhode Island, however my spouse is living in MA. Now I am planning to move to MA and commute daily from MA to RI. Can you please let me know what would be the tax implication. Will I be double taxed on my W2. Do I need to pay RI state tax on my income and MA state tax on my income.

    • Tax Advisor says:

      Hi Shashank,

      If you move mid-tax year, you will need to file two part-year state resident tax returns; one for Rhode Island and one for Massachusetts. In future tax years, you will file a resident state tax return for Massachusetts and a non-resident state tax return for Rhode Island. Each state differs slightly when it comes to taxing non-residents so double check each state’s residency guidelines. Also, you will not be double taxed. You will receive a credit fro your resident state for the non-resident tax paid.

  49. sriram says:

    Hi,

    I live in Texas and have a home. I got a job with a consulting company that had a project in Arkansas. They started deducting AR taxes even though i travel 4 days (Mon-thursday) and work Friday from Texas remotely. Agree i have to file a non-resident tax with AR. Will i get a refund since i don’t have a physical presence in AR.

    Thanks

    • Tax Advisor says:

      Hi Sriram,

      If you do not have a physical presence in Arkansas while working, then you are not responsible for state taxes. However, if your employer is withholding taxes from Arkansas, you will file a non-resident return in order to claim that amount withheld back as a refund. You can also speak with your employer as to why he is withholding Arkansas taxes on your paychecks. This could be a mistake that could be easily fixed. You mentioned that you travel 4 days out of the week. Depending on where you are travelling to could alter your withholding.

  50. Theresa says:

    I live in Alabama and I work remotely from home. The office is in GA. Occasionally I will have to visit the GA office for a meeting. Do I have to pay GA taxes?

    • Tax Advisor says:

      Hi Theresa,

      Each state has slightly different rules when it comes to taxing non-residents but I went ahead and took a look at the GA government website. It states:

      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 5% of the income received in all places during the taxable year or $5,000.00.

  51. Spencer says:

    I live in Texas and work for a company located in Texas, but I am currently working on a project that is located in Louisiana. Do I have to pay Louisiana state taxes because I am working on a project in Louisiana?

    • Tax Advisor says:

      Hi Spencer,

      You are generally responsible for taxes in the state where you physically work and reside. If you are living and working in Texas, it should not matter where your project company is head-quartered.

      • Spencer says:

        I reside in Texas and work for a Texas company and usually always work in Texas, but we have a project in Louisiana for the next 6 weeks that I will be working on. What are my tax requirements for this?

  52. anita says:

    hi my husband got laid off from a management IT job and now he is chasing jobs in different states. he worked in Tennessee for over a year and has been renting and our combined income was about $170k with 1 dependent his being the major income, i work part time . we own a home in long island ny and my son and i still live in NY due to his high school and also my husbands unstable work. we are stretched very thin due to two homes in 2 states. we take maximum deductions on our paycheck, he has 401k and i have retirement , we just filed our taxes and had to pay 6,000$$ which is killing me. what can we do to reduce our taxable income?? we don’t have any IRA’s, have a 529 plan . what can my husband do so he doesn’t have to pay taxes in 2 states as he does not even live here any more, only we do. we are planning to do so for another year and a half until my son graduates. please help

    • Tax Advisor says:

      Hi Anita,

      Married couples in similar tax situations as your own will file a joint federal tax return and separate state tax returns (still as married). By doing this, you would file a resident state tax return for NY based on your income. When filing a joint return, your tax is based on a combined adjusted gross income. Filing separate state tax returns makes you responsible for your individual AGI. Your husband would not need to report his income in Tennessee since it is an income tax-free state.

  53. Steve says:

    My employer put the wrong home address on my W2. However, the tax withholdings don’t appear to reflect the incorrect address (which was out of state). Can one assume that if box 15 on a W2 only has tax withheld for one state, that is the only state an employer reported earnings to?

    • Tax Advisor says:

      Hi Steve,

      This is pretty common but nothing to worry about. Your mailing address will not affect your taxes. Just be sure to report the correct mailing address when you file your tax return. Do not report the incorrect mailing address just because it is on your W-2 (I’m stressing this because taxpayers tend to do this when they are unsure). If you have access to your pay stubs/statements, then I advise that you double check those to see that your state withholding reflect what you are seeing on your W-2. You should be able to see this on your last pay stub. If you see ANY conflict, then let your employer know ASAP so that they can make those updates.

  54. Gina says:

    Would like to better understand this scenario:

    Live in Hawaii, work for Nevada company

    3 weeks a month working remotely at home in Hawaii. Travel to Nevada for 1 week a month to work in the office there…so roughly 75%/25%

    Get that I would pay state taxes for Hawaii as a resident, but for the 75%, or the whole year?…in other words, does my 1 week in Nevada each month offset the taxes required for Hawaii?

    Does my employer have to deduct Hawaii state taxes from my check? Do they need to be set up already to do so? (I’m proposing a remote working situation soon, and we don’t currently have any employees remote in Hawaii, so just want to know what they may come back with if they aren’t set up for Hawaii taxes already.) And can they adjust for 75% if that’s applicable?

    Thank you!

    • Tax Advisor says:

      Hi Gina,

      Great question! Since your employer has never had Hawaii taxes withheld for another employee, a few things could occur with the switch. They could apply to have Hawaii taxes deducted for you. I believe that they would need to pay for this to begin. The other option is that you will continue to have no state taxes withheld from your paychecks (since Nevada is income tax-free). When it comes time to file, you would file a Hawaii resident state return and the amount you owe for the year will be calculated. you’ll want to save up throughout the year so that you are not caught off guard by the amount you owe for Hawaii. These are the most common scenarios for taxpayers in your situation.

  55. Leona says:

    My corporate office is in Oregon, and we have offices throughout the US. For the last 5 years, I headed up the California office. My husband and I just moved to Nevada where I will be working from my home and coming to the California office once or twice a month depending on weather and I do need to get a hotel when I go there, so funds. Question for you, since I just moved and am now a residence of Nevada and I work from my home as a W-2, am I taxed as I’m from California or Nevada? Does my company need to set up anything for me to work in Nevada? Thanks?

    • Tax Advisor says:

      Hi Leona,

      Generally speaking, you are responsible for taxes in the state where you are a resident and the state where you physically work. You are not responsible for taxes where your company is headquartered (as long as you are not physically working there). In your case, you are living in Nevada. Nevada state residency is based on intent to permanently live there and the time you have lived there. Your company should technically seize to withhold Oregon taxes and California taxes (see CA rules for taxing non-residents for the time you are physically working in the state). If they continue to withhold for these states, then you will need to file a non-resident state return for the state they are withholding for so that you can claim that income back as a tax refund.

  56. Etienne says:

    Hi,
    I work from home in Florida for a company located in NYS, the payroll company is still withholding taxes in NYS so I had to file non-resident tax form to claim these withholdings from NYS in 2015. My question is how do I get my company to stop withholding in NYS so I don’t have income from a different state on my W-2 also removing the necessity to file as non-resident for that state.

    • Tax Advisor says:

      Hi Etienne,

      The most proactive step to take would be to speak with your employer or payroll department. Unfortunately, some companies will not seize to withhold taxes for the state that they are headquartered in. In this case, you will need to continue to file a non-resident state return for NY each year. This is tedious and seems unnecessary, however, it comes with the remote work territory sometimes.

  57. wes says:

    Hello,

    I recently moved to Washington State from West Virginia and am working remotely for a company based in West Virginia. I have not registered myself as a resident yet but am planning on doing so asap. I am currently paying state income taxes for West Virginia as I filled out my tax info and withholdings when I was still living in WV. Will I receive a refund for the taxes I am paying to WV as I am living and working remotely in a state that does not have an income tax?

    Thanks!

    Wes

    • Tax Advisor says:

      Hi Wes,

      The first thing you should do is update your W-4 information with your employer. You are technically only liable for income-tax in the state where you live and physically work. That being said, you should no longer be responsible for WV tax on your income since you are working remotely for the company. When you file your tax return, you will file a part-year resident tax return for WV and report how many months out of the tax year you lived there as a resident. You will be taxed on that amount and it will adjust accordingly.

  58. Daniel says:

    Hello,

    I work from home in Seattle, WA and my employer is in Illinois. At the most, I only travel to Illinois 2 to 4 times a year (10 to 20 working days) for work related meetings. Illinois withdraws state taxes from my check. I hear each state has their own laws in terms of withdrawing state income tax for remote employees. Should I be paying Illinois taxes? If so, would I be able to claim or get credit for IL state income tax withheld when I file a non-resident state return?

    Thank you.

    • Tax Advisor says:

      Hi Daniel,

      I suggest speaking with your payroll department as taxpayers are typically credited by their resident state. In your case, you would not be seeing as Washington is income tax-free.

  59. Lori says:

    I work from home in Florida for a company that is based in New Jersey. My W2 has NJ taxes. When I file my Non Resident return, do I get all of that money back or partial? In the past my Non Resient return was filed by someone else and I only recieved a few dollars back. When I did my return on my own, it made it seem like I should recieve back all of the taxes paid in. Please help!! Thank you.

    • Tax Advisor says:

      Hi Lori,

      When working remotely, you are only responsible for state taxes where you physically work and physically reside. When filing your non-resident tax return for NJ, you should receive that withheld income back as a refund (unless certain circumstances apply to your situation).

  60. Lori says:

    We are moving to Nebraska from Indiana and although my husband is looking for work in Nebraska, he was offered the option to work remotely from Nebraska(IT work) for his current company in Indiana. This would involve occasional trips back to Indiana for emergency onsite work. I understand that we pay taxes for state we reside in but if he works occasionally in Indiana how does that work?

    • Tax Advisor says:

      Hi Lori,

      Technically, your husband could be liable for taxes in states wherever he physically works and the state he resides in. His best bet will be to check with his employer to see how to company handles this situation. It tends to differ among employers and states. For example, certain states hold you liable for income taxes starting the very minute you begin work in that state while others only hold you liable after 2 weeks of working in the state.

  61. Christina says:

    Hi.

    I was living and working on NY. NYS taxes were being taken out, etc. Now i moved to Florida in July and started working remotely from home as an independent contractor for the same company, but at the end of the year will receive a 1099 for taxes. I don’t know who to file with? I appreciate your help.

    • Tax Advisor says:

      Hi Christina,

      In tax situations like your own, typically the way it works is you will file a part-year resident return with NY. On this return, you will report the income you earned there along with the amount withheld. For the time you spent worked and lived in Florida, you are not responsible for NY state income tax. You will report your 1099 information on your federal tax return filed to the IRS.

  62. Henry says:

    I worked and lived in Indiana for 3 months. Then I moved to MO to work for a new company for 5 months. After that, I move back to IN permanently and work remotely from home for the same company. The company only withholds tax for MO. For the tax year, I plan to file part- year returns for both IN And MO. Is this a correct approach.

    For next year, I will be working from home (IN) for the company in MO. The company continues to withhold MO tax. I will file MO non-resident to get all the withholding back and file IN resident return on all my income. I will pay estimate tax during the year to IN to avoid penalty. Is this correct? Any chance that MO will try to grab the money since my W2 showsMO income?

  63. Brandon says:

    I have an LLC based in Ohio. I am currently doing work for a New Jersey based company that requires me to have all my employees as W-2 employees. One employee lives in Texas and commutes to NJ each week. I understand that I must withhold both NJ and Ohio taxes for my employee, even though he never works in Ohio. Will he be able to claim a full refund on taxes withheld in Ohio?

    • Tax Advisor says:

      Hi Brandon,

      That is correct. Although you are withholding Ohio taxes, he will be able to claim a refund as long as he files a non-resident Ohio state tax return along with his federal.

  64. April Lymer says:

    I live in Texas and worked for my employer in Colorado as an independent contractor. I did not file any state tax returns in Colorado as my understanding was I paid state tax in the state I resided and worked from. I received a notice from the State of Colorado stating for 2012 they so nicely decided to file a Colorado income tax return for me based on my 1099 which they received from my employer I imagine and that I now owe them money. Do I owe them this money?

    • Hi April,

      Generally speaking, you are liable for tax in your state of residence and your state of employment. I do believe that your specific situation may require additional attention other that what you have stated above. It sounds as though you received an income document. These forms cannot be ignored since the IRS also receives a copy and do not know your specific situation. I strongly suggest speaking with your tax advisor. If you do not currently have one, feel free to contact our tax support team so that we can help with a bit more knowledge about your case.

  65. Amol says:

    We currently live and work in IL. All taxes are filed jointly. I am contemplating taking a position in NYC that will require me to work in NYC and fly back over the weekends. To avoid the NYC tax (not NYS), I am considering renting in NJ. Will I need to file any nonresident tax returns in NJ even though I have no NJ source income? Will the answer change if I purchase a condo in NJ?

    • Tax Advisor says:

      Hi Amol,

      You are liable for taxes where you physically earn an income and where you are a resident. Each state has slightly different rules in regards to residency, however, you are typically considered a resident if you don’t intend to be there temporarily. You’ll want to check with each state’s department of revenue as some states consider you a resident after spending more than a certain number of days in the state; regardless of your ‘permanent‘ home. Even if you purchase a condo, the tax you pay will still be based on your residency. That is the first step- determining whether or not you will be considered a resident or nonresident of NJ if you are living there while working in NY.

  66. Dwayne S Armbrister says:

    I live in Charlotte, NC and work online for a company based in Turkey. I am paid electronically via paypal, and will not receive a W2 or 1099 from the company in Turkey. How do I pay taxes on the income that I earn? Thank you.

    Regards,

    • Tax Advisor says:

      Hi Dwayne,

      Foreign income is typically taxable by the country where you earn it from and where you live while earning it. You will report this income on your tax return as you would U.S. income. If you are using Rapidtax.com, you will report it within the foreign income section. If you are filling out the IRS forms yourself, you will report this income on line 7 of the Form-1040. The IRS will make the necessary adjustments for your tax liability.

  67. Wilson Mago says:

    I live in Florida and will start work remotely for a company with headquarter in Georgia. I don’t need to travel to GA. If my paycheck does not deduct GA income tax, does that mean I don’t have to file a GA non-resident income tax? If my company deduct GA income tax, then I will have to file GA non-resident income tax to get my money back. Correct?

    My company also has a regional office in FL (not the place I live). I am wondering if I should ask the company to use the regional office do my payroll, that will eliminate GA once for all, is that correct?

    Thank you so much!

    Wilson

    • Hi Wilson,

      That is correct. You are only responsible to pay tax to the state where you physically work and earn an income and where you reside. If your company is withholding GA tax from your paychecks, then you will file a nonresident GA return to claim back the money that was withheld. In regards to your other question, that seems like a good solution. You can definitely speak with your HR department and see if they will accommodate you by processing your payroll in Florida.

  68. Andrew says:

    Hi!

    This is a complicated one. I lived in NYC but worked in NJ for the first half of the year, and then moved to California, but continued to work remotely for my company in NJ. My terrible HR dept. didn’t update my address, so NJ still withheld tax on my income…but in trying to fill out the Schedule S Californian return, it says that the ‘source [is] where the services are performed’…which was California. Do I file for credit from California for the taxes paid to NJ, or do I need to find a way to get NJ an amended W2 and tax return so that they refund me for the ‘source’ income that wasn’t sourced in NJ?

    • Hi Andrew,

      Although your HR department did not update your address, you’ll still file taxes according to your situation. In your case, you will file a part year resident return for NY, a part year resident return for CA, and a non resident return for NJ. On the part-year resident returns, you will be asked to provide the dates in which you resided in each state. You will be taxed based on this information (regardless of what your company withheld from your pay throughout the year). Chances are, the amount you had withheld for NJ taxes was too much since you moved to CA mid-year. If this is the case, after filing, you will be issued a refund (or credit) for the excess tax you paid. The same goes for the amount you paid to NY after moving to CA.

      You’ll want to keep in mind that while you continued to pay taxes to NY and NJ, you weren’t having taxes withheld for CA. This means that you could have tax due to CA after filing.

  69. Christina says:

    Hi. I lived in NY and moved to FL in July. I started working for the company i worked for in NY remotely, but once i moved to FL, I’m now getting a 1099. So i file my taxes for both states? Am i going to have to pay taxes in both states? Thank you in advance.

  70. Christina says:

    So then for the 1099, i file Federal with NY or FL?

  71. Parrish says:

    So if I work for a month in a state where I don’t reside and earn less in that month than the standard tax deduction in that state will have have to file a tax return?

    • Hi Parrish,

      Each state tends to vary with their rules. As you have not mentioned which state you are talking about in your comment above, I suggest contacting that state’s Department of Revenue or your tax preparer.

  72. Rassel says:

    Hello,
    My permanent address is in NY. My employer is in MA. I work 3 days in MA and 2 days remotely from home(NY). My employer ask me to fill up the W-4 form. So what address should I put on W-4.
    Thank you,
    Rassel

    • Hi Rassel,

      The address you provide on your W-4 is typically your permanent address. In your case, this is NY. You want to use the address that you will use on your tax return and where you wish to receive your W-2 form at the close of the tax year.

  73. David says:

    I am an attorney and I currently own an online law practice (100% of revenue is earned online) in California. I am moving my family to Washington State. I will continue my online practice selling services to California residents, but I will be performing all work / services from my office in Washington State. I will not be returning to CA at anytime for work or any work related purposes.

    I will also be starting a new WA based online practice as well.

    Since I am performing all work outside of the state of CA, even though my website sold legal services to CA residents, do I have to pay CA state income taxes on the income earned from the CA online practice?

    • Hi David,

      Generally, as an employee working remotely for a business headquartered in a different state, they would not be liable for the non-resident state income tax. However, rules can stray from that generalization when you own a business. I suggest contacting your tax advisor as more information will be needed to give you the most accurate answer. If you currently do not have a specific tax advisor, you can contact our team which specializes in business tax. You’ll be directed to a CPA who will be able to help based on your specific situation.

  74. Sampath says:

    Hello – Thanks for this great article. I live in Texas, have family and home in Texas. I travel every week to Washington DC, stay in an apartment for 2 to 3 days and work in DC.

    The company that pays me has a registered office only in Maryland, hence they generate pay and with hold Maryland income tax. I neither live, nor work in Maryland. Since the company is a consulting company, it just provided me a contract to work for a client in Washington DC. I do not report to the company or anyone in Maryland.

    Given this circumstance, how I can recover the state tax paid to Maryland where I am not working or living? When I talked to the company, they said they need a valid exemption for them not to with hold Maryland income tax. Maryland provides a form MW507 for claiming exemption, but this is only if I am domiciled in DC. I am not a permanent resident of DC either. Anyway exemption form MW507 only applies if I work or live in Maryland, both of which does not apply to me.

    How can I provide a valid exemption to my employer and state of Maryland in this situation and also recover the state tax already paid? Please advise. Thank you.

    • Hi Sam,

      Each state has different rules for who is considered a resident for tax purposes. According to Maryland, you are a full-year state resident if:

      Your permanent home is or was in Maryland (the law refers to this as your domicile). OR your permanent home is outside of Maryland, but you maintained a place of abode (that is, a place to live) in Maryland for more than six months of the tax year. If this applies to you and you were physically present in the state for 183 days or more, you must file a full-year resident return.

      Based on that and what you have stated above, you are not a Maryland state resident. In order to claim back the income that the company was withholding for Maryland taxes, you will file a non-resident state tax return to Maryland. They should credit you for that tax paid throughout the year as an issued refund.

  75. Claudia says:

    Hi,
    I have been living and working in MA but will be moving to TX in January. I will still be working for the company in MA but remotely from TX. Do i need to have any state taxes withheld in MA or no since I will not be coming to physically work in MA?

    Thanks

    • Hi Claudia,

      Based on your comment above, you will not be responsible for state taxes in MA once you are a resident of Texas for tax purposes. I suggest double checking the resident rules with the Texas Revenue department website since each state tends to differ slightly. You will be responsible for taxes in MA for any time you physically worked in the state throughout the tax year. Be sure to update your address ASAP with your payroll department. If your company continues to withhold taxes for MA from your paychecks, then you will simply file a nonresident tax return for MA along with your federal tax return to the IRS.

  76. Amy says:

    Hi, if I am a W2 working for a Hawaiian company remotely from Canada, do I need to pay state tax and Federal Insurance Contributions? And do I get any tax credit at all?
    Thanks.
    Amy

    • Hi Amy,

      If you fall under employee rules (as you are if you receive a W-2), then the company would most likely need to set up a business number with the Canadian Revenue Agency. This would take care of the payroll needs for you as you are a Canadian resident. I suggest speaking with your payroll department to see if this has been done and go from there. You may need to speak further with an accountant for more specifics on your tax situation.

  77. Lisa says:

    My boss has been paying us in personal checks for about 2 months now she says that she has been paying our taxes and insurance but she will not provide proof. What can I do

    • Hi Lisa,

      Although it is legal for employers to pay employees by personal check, it is frowned upon. This is pretty much the equivalence of paying in cash. Companies will sometimes do this to avoid paying payroll fees and taxes. As long as the employer is paying taxes and fees to FICA and the IRS, this is completely legal for tax purposes. However, it does seem a bit strange that your employer will not provide you with some type of record. You are entitled to this. Also, your employer should be withholding taxes, Medicare, and other common fees from your paychecks. I suggest speaking with your employer again, possibly explaining that you need a record to keep within your personal files for when you file taxes. The next step would be to contact the IRS to see that your employer is paying taxes on your behalf. If not, then the IRS will let you know the next steps to take. If they are, you should still be receiving a record for yourself of your pay. These will most likely be requested of you in situations such as applying for a car or mortgage loan, tax purposes, etc.

  78. Meredith Fontenot says:

    Hello.

    I live in Louisiana (state tax) and work remotely for a company in Florida (no state tax).

    I was told that I wouldn’t need to pay state taxes on the money earned from the company in Florida, however, the Florida company thinks they need to report my income to Louisiana.

    Which is correct?

    • Hi Meredith,

      You are typically responsible for paying income tax on the state where you reside and the state where you physically work to earn an income. In your situation, you are residing and physically working in Louisiana. That being said, you would be liable for filing a resident state Louisiana tax return and paying tax on that income earned.

  79. Thomas says:

    First off, thank you for answering all of the commentor questions. The answers have been very useful. However I have a situation that seems to be a bit different from all the other previous comments :

    I lived as a full time resident in France from 2011 to 2014. From 2012 to 2014 I had several sources of income. One was from an Oregon company paying me 1099. Every year I filed my federal taxes with the irs, including my Oregon income and my income earned in France. But I didn’t file an Oregon state return (it didn’t even cross my mind because I didn’t live in Oregon). In 2015 the Oregon company offered me a salary position (W2), with the stipulation that I had to move to Oregon. I accepted and moved to Oregon. So in 2015 I included an Oregon State filing in my tax filings. Today (Dec 2016), I received a “Notice and Demand to File” letter from the state of Oregon saying that I had 30 days to file an Oregon return for the period ending December 31, 2013. Otherwise, the letter says I will face penalties.

    Can you give me any feedback on this? They are asking me to file a return for a tax year that I didn’t live in the state. It’s also interesting that they haven’t sent me a similar letter for 2012 or 2014.

    My address on my 2013 federal return was in France.

    Thank you in advance.

    • Hi Thomas,

      Thanks for the question! I apologize for the delay in response as I wanted to do a bit more research about your specific situation since you lived outside of the U.S.

      The first issue to tackle is determining from the Oregon State Revenue Department how you were taxed once you lived in France compared to when you lived in OR. If you resided in OR prior to your move in 2011 then moved back to OR after France, then the state department may consider you to be a resident still IF you owned property in OR.

      For additional guidance, you can fax or email our tax support team the notice you received in the mail. We will be able to decipher the instructions and let you know how to proceed.

  80. Heather says:

    My husband and I own an LLC that is based in Nevada. It is a side company and not our primary income. We sell a service online and do not visit clients. Our vendor relationship has us using a PO Box in Ohio so that we can work with our preferred territory rep for their company but we sell online to anyone in the US and never go to Ohio. We also don’t live in Nevada. My husband’s primary employer has just moved us to CA.

    How do we handle the tax situation? We are provided a 1099 from our vendor to our LLC. Do we file in CA, NV or Ohio? Do we need to move our LLC to CA or can we leave it in NV? The Ohio PO Box is strictly for determining whose territory we fall under with our vendor but not where we conduct business so to speak.

    • Hi Heather,

      I appreciate your comment on our blog but I do believe you would benefit more from contacting a private accountant. Taxes paid for your LLC are a bit more complicated than individual taxes. State taxes for your LLC are even more complicated seeing as each state has different rules to follow. I suggest speaking with your state revenue department as well as an accountant for your business. If you currently do not have one specifically, we offer business tax preparation as well as our individual tax prep service. You’ll be able to speak with one of our CPAs before committing to the service so it may be your best bet.

  81. Jackie says:

    Hi,

    I am moving to Oregon and I work from home. My companies are in California. How does this work.

    Do I have to file for Oregon and California state taxes? I only work from home

    Thank you,
    Jackie

    • Hi Jackie,

      Typically, taxpayers are only responsible for paying tax to states where they reside and physically work and earn an income. In your case, it will depend on when you move to Oregon. If you qualify as a part year resident of both Oregon and California based on when you move, then you will file two part-year resident tax returns; one to each state. If you start the year off living in Oregon, then you will end up filing a resident tax return to Oregon and a nonresident tax return to California.

  82. Jennifer says:

    In 2016, my husband and I, both U.S. citizens, worked (from home) for Canadian corporations. However we spent 2/3 of the year in Illinois living in a rental home. We get paid in $CAD and assumed we would have to file as Quebec full-time residents, even though we’ve physically spent the majority of 2016 in the United States. Are we able to file as part-time residents in Canada, even though we worked year round for Canadian corporations?

    • Hi Jennifer,

      When it comes to determining whether you are a US state resident for tax purposes, it is generally based on your intent to maintain a domicile in that state permanently or temporarily. A lot of the time, if you are only in the state temporarily, you will not be considered a resident. This can differ from state to state if you’ve been in the state for more than 183 days of the tax year. Here are the specific rules for Illinois. When it comes to Canadian taxes, I strongly suggest contacting the Canada Department of Revenue. They will be able to let you know the guidelines for what constitutes an individual as a full year or part year resident for income tax purposes.

  83. marco a torres says:

    I live and am a resident of the State of Hawaii, the company I work for taxes me as a California resident even though I am not. They won’t change my residency and I keep getting charged California state income tax. What happens to those taxes since I don’t live in Califirnia?

    • Hi Marco,

      You can receive a refund/credit back for the taxes you paid to California throughout the year. You will file a non-resident California state tax return. The state will see (based on the information you provide on the return) that you did not physically work or reside in California.

  84. Carl says:

    I am getting ready to start a new job next week. I am a resident of and will be physically working in MA. This is a start up franchise with an established business presence in CT, they have advised me that I would be considered an employee of the established business in CT. Any thoughts on how this would work?

    • Hi Carl,

      Congratulations on the new position!

      From a tax perspective, you will report all income and withholding from the year on your federal tax return. You will also file a resident return for MA, reporting all income earned and withholding. It sounds like your company plans to withhold income tax for CT based on your comment above. Typically, in this situation, the resident state will issue a credit back to the taxpayer for paying taxes to the nonresident state. In order for this to happen, you will need to file a nonresident state tax return for CT.

  85. Anthony says:

    Hi Michelle,

    I just wanted to circle back on the above question to see if you could offer any guidance. Thank you!

  86. Sergio says:

    Hi, my company is based in Colorado but I work from home in pa. I never ever travel to Colorado and never will. So, I only pay Pennsylvania state income taxes correct?

    • Hi Sergio,

      You are liable for state taxes where you physically work to earn an income and where you reside. In your situation, that would be PA for both circumstances. What will typically happen is you will file a resident return for your resident state and report all income and withholding. You will also file a nonresident return reporting your income and withholding from just your nonresident state. Then, your resident state issues a credit for the tax you payed throughout the year to your nonresident state.

  87. Todd W says:

    If I am a member of a Texas LLC would I pay state taxes where I live, Indiana?

  88. william hutchinson says:

    I live in Louisiana but the company I worked for was out of Texas but I worked in Illinois. The company held out Louisiana state taxes. How do I file this.

  89. JG says:

    I am attempting to work out a remote work situation with my current employer. I currently work for them in the New York office but would like to move to Indiana. My employer is not set up as a corporation in Indiana but they are set up in Illinois. What are the tax implications of this? Would i be able to work remotely for my employee in Indiana even though they are not set up as a corporation there? Would I have them still take out NY taxes or should I have them transfer me to the IL office and have IL taxes taken out?

    • Hi JG,

      This situation is common. If your employer continues to withhold NY taxes, then you will file a non resident state tax return for NY along with your resident state tax return and your federal return. You will be issued a credit (as a refund) for the unnecessary tax that you paid for the year to NY.

  90. Kevin Jocius says:

    My wife and I lived the entire year of 2016 in Alaska. She works remotely for a company in Illinois and never visits Illinois for that work. It is all done remotely. Does she have to pay Illinois income taxes?

    • Hi Kevin,

      She should not be required to pay Illinois taxes. However, she should file a nonresident IL tax return if her employer was withholding taxes from that state throughout the year.

  91. Qamar Khan says:

    I am working in texas my company who pays me is in N.J.
    I am a I.TConsultant. I am permanant Resident of Texas.
    What should i need to do ?

    • Hi Qamar,

      First, check your pay statements or W-2 to see if your employer is withholding taxes for NJ. If they are, you can file a nonresident NJ state tax return. You won’t need to file a resident return for Texas since it is an income tax-free state.

  92. Mike says:

    I live en FL and I just started working remotely for a company in GA. Should I get a full return from GA state when I file a nonresident form?
    Thanks,

    • Hi Mike,

      The state where your employer’s corporate headquarters is has no bearing on your state income taxes unless you have physically worked in the state. That being said, if your employer has withheld taxes from their headquarter state, then you will need to file a nonresident return for that state to receive a refund of the amount withheld.

  93. Joe McGarrity says:

    Hi,
    I live in North Carolina, but the employer is in Poland. I am a US citizen but will be working remotely for the company. What steps are in order to abid to all US and EU tax laws? Where can I find the rules and regulations?
    Thanks

    • Unfortunately our company does not specialize or prepare tax returns with foreign based income. We apologize for the inconvenience, but we will not be able to answer your questions.

  94. Kathy says:

    Hi there. I live in Alaska and am considering a remote position for a hospital in Oregon. How would the hospital determine if they are going to withhold state taxes for me or not? If I end up with a W2 that has Oregon state taxes withheld and i have to file a non-resident return will I be refunded for what they withheld?

    • Since you are a resident of a tax-free state (Alaska), and have worked in a taxing state (Oregon), you still have to pay taxes to the state where you worked. Unless you are working in a reciprocal state, you will have to pay taxes to the state where you earned your income. You would be required to file a nonresident return to pay these taxes.

  95. Kacey says:

    I live in Minnesota and work remotely from my home for a company in Illinois, should my employer be withholding IL state taxes?

    • Generally, if you live in one state and work remotely in another, then you would only file and pay taxes to your resident state (in your case Minnesota). However, if your W-2 form lists IL in box 15, then you’ll need to also file a non-resident tax return for IL.

  96. william says:

    I reside in Ohio. I am employed as a contractor and have worked exclusively overseas (Iraq and Afghanistan). All work performed was exclusively in Afghanistan and Iraq. Am I still expected to pay Ohio personal income tax for this income, even though I didn’t technically work “in Ohio”…or even “in the USA” for that matter?

  97. Max says:

    Hi There,

    I currently work out of my company’s HQ in New York. I am looking to move down to Florida and work remotely at my current company but my company is not willing to get a license to practice business in FL. I also have family in NYS and wanted to know what the implications were if I was to put my residence as my family’s address (which I would visit quite frequently) but spend the majority of my time in Florida at an apartment that would be leased under my name.

    Is this allowed? what are the risks involved in doing this? How much time to I have to spend at the NYS address in order to be considered a resident?

    Any help would be greatly appreciated.

    Max

    • Max says:

      I work in a sales position if that has any impact on things.

    • You most likely cannot have more than one domicile and might not be able to file in this manner. Unfortunately there are many if, and, and buts involved with these questions and they cannot be answered simply without additional correspondence and research. However these are the kind of questions our tax professionals could assist you with further if you were to prepare your returns with us. Thank you.

  98. Yasmin says:

    I moved to Virginia from the US Virgin Islands in Sept 2016. I work remotely for a company that is based in the US Virgin Islands because of this I am required to file Federal Income taxes in the US Virgin Islands (Our tax dollars are kept in the Virgin Islands). We do not pay state taxes…Should I have to pay taxes in Virginia?

    • You may be subject to special tax rules. Your tax treatment of your income depends on whether you are a U.S. citizen, a dual citizen, permanent resident or a foreign citizen without a green card. If you are a resident alien required to file a Federal income tax return, then you must file a Virginia State tax return.

  99. Greg Norris says:

    I live in Kansas but work for a company as an independent contractor in many states. The company is based in Missouri, but none of the actual work has been done in Missouri. Should I file as a resident in Kansas and as a Non-resident in every other state I’ve worked in (according to the state’s specific guidelines)? How should I file in Missouri, if at all?

    • Greg Norris says:

      I received a 1099-MISC tax document

      • If you received a 1099-MISC with your income reported in box 7 “non-employee compensation” you are considered self-employed. The IRS requires that you report this income on a Schedule C. Rapidtax expertly handles Self-employment income. Click here to get started today.

    • If you did not physically work in Missouri, you may not be required to file a Non-resident return for that state. If you have 1099-MISC’s for multiple states, you will need to file a state return for each state that you for which you have taxes withheld. Generally, if the state you reside (Kansas) in has an income tax, you have to file a resident tax return with that state, as well as a non-resident return in any other taxable states where income was generated. Rapidtax expertly handles resident and non-resident returns. Click here to get started.

  100. Ruth says:

    Last year we moved from California to Colorado. My husband starting working in CO on April 11th (living in temporary housing while looking for and buying a house) while the kids and I stayed in our rented CA house until June 17th (when school got out and my job ended). During that time (mid-April to mid-June), my husband’s income was taxed in *both* states (as a resident of CA but physical presence in CO).

    Double-taxation is not allowed, in theory at least, so one state should give a credit for the taxes collected in the other state, correct? We will be filing state tax forms for both CA and CO (part-year residency in each state) but which state return should file for the “double taxed” credit…CA state return should request a tax credit from CO? Or vice-versa?

    • Generally two Part Year Returns do not offer a Credit for taxes paid to another state since the income is not taxed by both states. However, in your case the employer has taxed both states. Some states offer worksheets to indicate Double Taxed income computations. Unfortunately these are the simplest answers we can provide as there are many determinant factors to how you should file. Our customer service representatives could assist you in determining these questions and figuring these computations if you were to prepare your tax returns with us. Thank you.

  101. Jamie says:

    My wife and I live in Indiana. I lived here all of 2016 and she didn’t move from SC to Indiana until April 2016. She works remotely from home for a company based in SC. Her company only withheld SC taxes for 2016, but we filed our return together and are showing a large refund from Indiana.

    This doesn’t seem right and I’m worried Indiana is going to say there was a mistake. We told the accountants when exactly my wife moved. I make about twice what my wife does and my income was taxed all year in Indiana and we filed together, so could that have a positive effect on it?

    I told my wife to make sure her company is taking Indiana taxes out in 2017 going forward. I’m assuming that’s the correct thing to do.

    • There are many reasons for why your Indiana return could have a large refund and we cannot gauge or determine this positive or negative reason without your tax returns. The large refund could be a result of a IN Resident Credit for taxes paid to SC. Please consult with your accountants.

  102. Michelle says:

    I live in NC, but work for a company in CA. My W-2 shows state taxes withheld for CA. Right now, my tax filing says I owe state taxes to both CA and NC. How is that possible? Thanks for the help.

    • Since you resided in NC you have to file a resident return for this state and a non-resident return for the state where you earned income CA. You must ensure that you received a credit from NC for taxes paid to CA. You can end up owing both states if your employer did not withhold enough state taxes for the year.

  103. Alejandro Orta says:

    Hello!

    I have a funny situation I don’t know how to deal with…
    I’m not a US Citizen, I am not a resident alien, I don’t even live in the US, I live in Costa Rica. The only attachment I have with the US is an LLC-S incorporated in Florida, I’m the only owner of it.

    I use this LLC to collect dues from companies all over the Caribbean and Central America (again, no business held in the US whatsoever); so, I give consultancy to various clients, and when finished, I asked them to submit their payment to my LLC in Florida, to a bank account under my LLC name, and as a final step, I pay myself overseas (Costa Rica) as Overseas Services description. I am not employed by the LLC, I am just the owner.

    My question is: do I have to file taxes in the US (FL)? Do I owe something to the IRS?

    Thank you! I hope you can help.

    • Unfortunately since we do not prepare or specialize in returns containing foreign income and/or foreign residency information, we will not be able to determine these answers for you. We apologize for the inconvenience. Please contact the IRS for more information for your situation.

  104. Karla says:

    I am moving to NY state in June, but will continue to work remotely for my employer in Iowa. HR is asking me how I want my taxes handled, because they will have to open accounts in NY in order to allow that state to withhold.

    From what I’m reading, it looks like I could have Iowa taxes withheld, then file both Iowa part-year resident and Iowa non-resident as well as NY resident for the 6 months that I live there. Then Iowa will refund me for what was withheld over the last 6 months of the year. Is that correct? What forms will I need to file 6 months worth of resident income in NY, when my W2s will only have full year income with Iowa withholding?

    • Be advised, you would not be able to file more than one state return per state per year; it would either be Part-year or Non-Resident for each state.(Ex: You cannot file both ‘Part-Year’ and ‘Non-Resident’ IA returns, you would only be able to file either a ‘Part-Year’ or a ‘Non-Resident’ IA return per year).

      You should be preparing a ‘Part Year IA’ and a ‘Part Year NY’ returns (no full-year resident returns). Since the employer is giving you a choice, you should have them withhold IA taxes while your are in IA, then NY taxes while your are in NY. This way you will save yourself additional steps and your income would be allocated to both states on your W-2’s based on what is reported on your W-2 Boxes 15-20. However, if they withhold IA taxes the whole year, then you would have to manually specify and pro-rate on your ‘Part Year NY return’ how much of your IA income was earned while living in NY.

  105. Sergio says:

    Question; I live in California and work remotely from California for a Florida subsidiary of a large corporation (I since changed jobs from HQ in Philadelphia to Miami). I just noticed that my employer is not taking state taxes out of my paycheck at the start of 2017 due to change in position from Philadelphia to Miami.. For the last 18 years, they were withholding CA tax, but this job change seems like it messed things up. Do I need to inform Payroll to fix it to move it back to withholding CA tax? I am concerned about not having any CA tax taken out and having to pay a big chunk next year. Thx

    • It would be best for you to contact payroll on advisement with proceeding with this matter. Typically payroll has their specific reason as to why they would being withholding state taxes pertaining to which state. For the case of Florida the sudden stop of state taxes withheld may be due to them relocating to Miami, and the state of Florida, where residents are state tax exempt.

  106. Rachel says:

    Company I work for has a sister office in PA where I to work remote several days of the month. The sister company is a separate tax ID. I live and get paid in FL under FL company’s tax ID. Do I have any responsibility to PA?

  107. Steve Gore says:

    Hi,

    I live in Ohio and am a resident of Ohio working remotely for a company in Texas. So how is this going to work. My employer has not witheld any state tax as my income is generated in Texas which has no State Tax. Will I have to pay state taxes for Ohio now.

    Thanks

  108. Steve Gore says:

    Hi Sorry i mistyped my email id before. My question is

    I live in Ohio and am a resident of Ohio working remotely for a company in Texas. So how is this going to work. My employer has not witheld any state tax as my income is generated in Texas which has no State Tax. Will I have to pay state taxes for Ohio now.

    Thanks

  109. Joy says:

    I live in Michigan and work remotely for a company located in New Jersey. They have been taking out NJ state taxes. Because I work remote from MI, shouldn’t they be taking out MI state taxes? When I file the NJ Non-Resident return, it takes into account not only my income, but my husbands income in order to come up with the % to multiple in their formula. By doing so, I end up having to pay even more taxes to NJ. I have never lived in NJ and do not go there. Is there something about that state that I am missing??

  110. Ezinne A says:

    Hi there,

    Ho do I handle a form 1099-Misc for consulting work that I completed remotely.

    In 2016 I was a resident of Alabama where I had my regular job (I live abroad now). However, for part of that year, I also earned money for consulting and no taxes were withheld. Do I need to pay state taxes for the state the consulting company is located? How do I pay federal taxes for consulting job? Please what advice do you have for my situation.

    Thanks

  111. Debbie says:

    My son is a Florida resident. In 2016 he had 2 part time jobs while he was a student: He worked in Orlando 3 days a week at a finance company and he works remotely for a NY based company creating spreadsheets a couple of days a week. The W2 for the FL company has no information in boxes 15, 16, and 17. His W2 for the NY based company shows information in boxes 15, 16, and 17, so does this mean he has to file a non resident NYS tax return? We attempted to do this and the efile system is automatically calculating the NYS tax amount on his entire earnings (FL and NY), not just the NYS portion.
    Why is this and what should we be doing differently (other than mailing in a paper copy)?

    Thanks

    • For the income that was earned in Florida, the earnings should be completely exempt from state taxes. However specifically with your NYS earnings, they are subjected to a non-resident state tax. You will need to be filing this as a non-resident keeping in mind that what you’re entering in boxes 15-20 is accurate. That way the system can determine exactly, which earnings to allocate to which state so that only the income earned in NYS is taxed on your non-resident NYS tax forms. If you have an account with us, and have already submitted, we will be able to further assist you on the nature of your state tax return forms. You can contact us by phone at (877) 289-7580 during our hours of business Monday-Friday, 10am-5pm EST. (excluding holidays) or through our live chat support.

  112. Pete says:

    Hi

    I currently work in Massachusetts, am moving to Florida, and will be working remotely.
    I was told that my company will be withholding Mass state tax throughout the year.
    When it comes time to file my tax return, I’ll be filing a Mass non resident return.
    The state of Florida has no state income tax.
    Will I somehow be receiving a refund for the taxes I paid to the state of Mass, because I live in a non taxable state?

    • Although, you are a resident of a tax-free state (FL), and have worked in a taxing state (MA), you still have to pay taxes to the state where you worked (MA). Unless you are working in a reciprocal state, you will have to pay taxes to the state where you earned your income. You would file a nonresident return to pay these taxes. Rapid tax simplifies the preparation of Non-resident returns. Click here to get started today.

  113. Freddie says:

    Hi
    So I live in New York city (NY) working remotely for a company in New Jersery (NJ). For 5-6 months of the year I live and work remotely abroad but they pay me in NYC, do I pay full resident New York State taxes or do I pay part time resident state taxes or how does it work? They don’t do anything different with my earnings when I’m abroad.(not sure if that matters)

    • If your company has chosen to withhold state taxes in NYC for your income that you earned remotely in NJ, all you will need to file is full year resident. If it has any other state information within the income statement, you may need to file differently.

      By making an account with us, we will be able to better assist you further along with your taxes then through correspondences through these comments. It will allow us to see an in depth view of your records that you would like to file, and we will be able to offer you better assistance.

  114. Ellen Ku says:

    Hello, I have a question about withholding state taxes for a remote employee. We are located in Wisconsin, but we have a remote employee who resides in Georgia. He requests that we withhold Georgia state income tax (SIT) for him. However, we are concerned that if we process the Georgia SIT, we may incur corporate tax. As such, we do not want to apply for a Georgia account. Which state’s income tax should we withhold, or none? Any advice would be greatly appreciated.

    • Unfortunately we cannot advise you on how you should withhold your state taxes for your employees. It may be best for you to consult with state offices, for further advisement or information pertaining to this situation.

  115. AR Resident says:

    In Arkansas, you pay Arkansas state income tax on all amounts earned while residing in Arkansas, or amounts earned _from Arkansas sources_ while residing outside of Arkansas. There used to be exceptions for amounts on which you were taxed by your state of residence, but it’s been awhile since I looked into those rules.

    California does something similar – but they even require taxes be withheld on amounts earned while working in the state (but not residing there) even if the payee is in a different state. As an example, I traveled there to perform a week of training at a client company, and the client company paid California state income tax on the amounts I earned – even though the company for which I was working was based in my state of residence.

    • When you are earning income from another states yet do not reside there and you have paid taxes, what you are looking for is a credit to be allocated to you full year resident tax return to prevent double taxation. All non-resident states have the right to tax any income earned within their jurisdiction, and your full year resident state has the right to tax all income earned regardless of where it was earned from. In the end you are looking to receive that non-refundable resident credit to avoid your resident state from taxing you on taxes paid to non-resident states.

  116. Bryan Angelo says:

    Hi I need some advice/assistance

    In July 2016 I moved from Florida to NJ. My employer is still in Florida and I work remotely in NJ. When I made the move, our payroll company mistakenly didn’t withhold NJ taxes for the remainder of the year. I am now trying to file my taxes but having difficulty. We do not conduct business in NJ I am the only payroll employee here. I am trying to pay my NJ state taxes from July – Dec but it is not letting me in H&R Block. Any help?

    • Going off of your income statement, you would be filing state returns specifically for the states that are indicated within the form. If there are no states indicated on your form, there is no taxable income that you would need to report earned to the state. However you may want to speak with your department to have this adjusted if you plan to reside in New Jersey for the full year.

  117. Joy Adkins says:

    Greetings,

    I have a strange situation. I am a medical transcriptionist and I work remotely. I have done this work for 15 years and this is the first time this has happened.

    I live in Virginia. I recently switched jobs (in October 2016) and I now work for a company located in Albany, New York. When I got my W2, there were no Virginia state taxes withheld, but there were New York state taxes withheld. This was a minimal amount, only $86.10, but it was only for the months of November and December 2016.

    I took my information to my tax preparer and I only got back $34 of the $86 that was taken out for the state of New York. Why do I have to pay $52.10 to the state of New York when I do not live there or physically work there? I also have to pay Virginia taxes on top of this. This was a minimal amount for only 2 months, but this could really add up in a year’s time.

    I am not quite sure what I need to do. Can you please advise?

    Thank you.

    • If your payroll department has decided to have your income taxed within the jurisdiction of New York while you were a full-year resident of Virginia, your state returns would be a full-year resident with VA and a non-resident state tax form with NY. New York has the right to tax any and all income earned within their state if you are earning income there as a non-resident. However for your full-year resident form you can also have a non-refundable resident credit allocated to your full-year return in order to reduce or satisfy the tax due for Virginia for taxes paid to New York. Rapidtax can help you with filing your state tax forms, and our customer support team is available to assist you through the process.

  118. Deb says:

    Currently I live in NY hubby is self employed here. We want to move out of the state. I want to start an online business but want to set it up in another state (Missouri) We want to move to Missouri in the future which is why I want to set it up as there. Also he has a sales tax id and we file sales tax here for his biz,..would I have to do the same in NY?

  119. Jeff says:

    Hi there,

    I am thinking of starting employment in a Chicago based non-for-profit organization but working remotely out of my home here in Westlake, Ohio. I am trying to work out where and how much tax I would end up paying on approx. $115,000. Any assistance would be grately appreciated.

    Kind regards,

    • Which state you would file depends on how you are paid. If you receive a W-2 statement that shows IL in Boxes 15-20, then you would prepare a Non-Resident IL return and a Resident OH return. If your W-2 shows OH in Boxes 15-20, then you would only need to file a Resident OH return. If you are paid as a contractor via 1099-MISC, then you would only need to file a Resident OH return since your income is earned while in OH. How much tax you pay you may estimate using the specific state’s tax tables. Thank you.

  120. Tammy says:

    Hello,

    I been working remotely in FL for about 1 year now.
    I have been a 1099 until this month
    My employer is in MA, I received my first check as a W2 and I see a MA tax deduction for $87.
    I called the payroll company and they said that because my employer is in MA, he has to report it and the deduction will happen
    Is there a way someone can confirm that please?

    My husband also works remotely from FL and his employer is in MA and he doesn’t get charged MA taxes
    I’m so confused.

    Thanks

    • Every company has their own regulations and set up with the state, you will need to file and pay taxes to a state with the agreement that your company has with MA. It seems that they are mandated by the state of MA to withhold taxes for income that their employees earn, and your husband’s company is not. Unfortunately there is nothing further you can do, it is mainly dependent on your employer.

  121. FRANK WELLS says:

    I don’t know why tax is soo complicated. So here is my dilemma. I reside in Washington state with no state income tax, but started working for a California-based company from October 2015 to Dec 2015. We relocated to CA in January of 2016. Now we have received a notice we have to pay state Income Franchise tax for the months of October 2015 to Dec 2015 because the money was sourced from a company in California. is this true and accurate? would appreciate a response here. Thanks

    • State taxes paid, is dependent on the agreement the company has with the state. If the state mandates that taxes be withheld for the income earned from the company that is earning the income in their state, they must do so for all their employees. This means you are earning non-resident income, and will need to report your state taxes as such, if you are still working remotely from WA. Rapidtax is a website you can use to easily file your state returns, and our customer service support is here to assist you throughout the process.

      • Jen says:

        I am sorry to comment under this thread but couldn’t find another way to ask a new question.

        We will be moving from Maryland to SC this summer for my husband’s employment. I will continue to work at home for my Maryland employer. (I have always worked off site.) Will state taxes for Maryland and SC be taken out every year or just this year? Will I get a credit for the MD taxes if I haven’t lived/worked there? Will I need to file in both states and then get a refund for the MD taxes?

        Your site is very informative and your personal responses are appreciated! Thanks in advance.

        • Based on your tax situation, you may need to file a part year MD and SC return for 2017. However, for the following years, if you reside for the full year in SC and work remotely for an employer headquartered in MD, then you would only file and pay taxes to SC.

  122. al says:

    i live in ny and worked 2 days in pa and 3 days in ny. my paycheck only showed pa state tax withheld. is this correct.

  123. James Sinclair says:

    I own a consulting business incorporated in Florida, I am moving to VA. My income is all 1099 so I am responsible for the Federal taxes. I will be traveling back and forth to Florida as situations demand. But how do I handle the State taxes in VA.

    • Since you are moving to VA and becoming a part-year resident, you will need to determine the days you’ve earned income from Florida as a resident of Florida and the income you earned from Florida as a non-resident while being a part-year resident of VA. Since you have expressed that you own this business, you will need to make this calculation, and separate the income accordingly to the dates you have lived in those states.

  124. Steve says:

    Would you please post the IRS publication(s) from which the details of your article are sourced?

    • The details of our articles are based on general truisms based on many state publications. Even though each state may have their own set of formalities, every state share commonalities in their filing regulations when it comes to filing a remote income earned tax return

  125. Linda McElroy says:

    I live in TN, along with my investments being in TN. If I use a financial advisor that works in Indiana, will I have to pay Indiana state income tax for him to manage my money from his office in Indiana?

    • You do not have to pay IN taxes on your investment income since you are a Resident of TN and your investments are in TN. Where your money is managed does not determine where it is taxed. It is the source of where the money is earned that determines where it is taxed.

  126. Cindy Rehlinger says:

    My Residency is in WI and I am employed in WI, I will be working remotely during the winter (Snowbird) Nov-April in AZ and Calif- we have motorhome so we will be staying different places for a month here and there. My employer said they will be taxing me according to AZ rates during that time as I don’t know how long I will be one place or the other. In May, I will return to WI and work at my home again for about 6 months. So will I need to file Non-Residence taxes for both AZ and CA? I won’t even have an address for those months, camping and boondocking along the way. Help!

    • According to how your employer files your state taxes, the states that are shown on your income statement will help guide you as to whether or not you will need to file a Non-Resident return for either state or both. From the situation, it seems that you will only need to file a Nonresident return with AZ, or even possibly a part-year resident return for both AZ and WI. You will be able to better assess this after you receive your income statements for the tax season.

  127. Shade says:

    I live in Australia and held an online seminar in Philadelphia, PA. Do I need to pay taxes in USA for ticket sales?

    • Unfortunately, our website does not deal with foreign income, so we cannot provide you with any further advisement. It would be best if you speak with your tax professionals for further information. It may also be best to speak with the company that employed you.

  128. Sierra says:

    Hi, I have a question which I tjink i know part of the answer to. I will become a resident of OR soon, but I work for a customer service business headquarter in SC. I started working for this company last year. However I lived in WA and now come to find out they are not licensed in OR. Is it at all possible to keep my working address in WA, which is at my grandmother’s, but still live in OR and pay resident income tax? I was not taxed by the state of SC as this is a remote job.

    • Your eventual Resident State of OR will tax the income whether your address is in WA or OR (The resident state taxes all income wherever it is earned). If you proceed with keeping the WA address with your employer, no OR taxes will be withheld by your employer. Therefore you will end up with a high tax liability on your OR tax return at the end of the year. How you proceed is up to you and your employer.

  129. Devon Whitehead says:

    I live and work in California. However, the company is based out of Utah and when they process payroll, Utah taxes are withheld but not California taxes. I file single with no dependents and I’m concerned I will owe money next tax season due to California taxes being higher than Utah’s. Will I have to pay both or just the difference? What should I be expecting?

    • If your company is withholding non-resident income taxes for Utah while you are a CA resident, you will need to file a full-year resident CA and non-resident Utah tax return. This is so that your CA state tax return will have the proper allocated full-year credit so that you will not be double-taxed. You will end up paying the difference.

  130. Diane N says:

    Hello. I’m moving to California for a job, and will continue working for a Texas company remotely, as an independent contractor. How will I have to file my taxes ?

    • If you are becoming a part-year resident in 2017 of CA, you will need to report all of the income that you earn during the period that you become a resident to the end of the year. That income will be subjected to taxes in CA. However, for the next year in 2018, if you are becoming a full-year resident of CA, all of your income will be subjected to taxes that you are earning elsewhere as a non-resident.

  131. Pam Dooley says:

    I am a retired Texas teacher. I also teach online for a school in Louisiana. We are going to be selling our house in Texas and buying an RV and traveling the country. We will be keeping our residency in Texas. We don’t have a state income tax in Texas. Are states we visit as we travel the US going to expect us to pay income tax even though I am just visiting but will be still teaching online? How would they know?

    • You will need to discuss this with your employer as this will be dependent on which states your employer will be filing your taxes to. All of the income that you earn will be subjected to taxes depending on what your end of the year income statement shows. If you are a W-2 employee, this information will be in box 15 and will guide you to which states you will need to file for.

  132. Dave says:

    Hi,

    I am a U.S. Citizen born and raised. I work for a California company remotely. Because I work online, I recently moved to Ireland (I have dual US/Irish citizenship). I’ve been continuing to pay Federal US and California income tax, (it’s taken out of my paycheck) but wondering if this is now wrong?? What do I need to tell my employer? Am I technically allowed to do this?? Should I be paying No Fed or CA tax and just paying tax in Ireland?

    • For the state of California, any and all income that you earn within this state will be taxed by California, even though you are a remote worker. Because you are a dual citizen, your income is subjected to Federal tax as well. You will have to pay both Federal and Ireland taxes.

  133. Vanessa says:

    Hello,

    I recently moved to New Hampshire and I work remotely. My company (based in Massachusetts) asked me to come in once a month. The great thing about New Hampshire is you don’t pay state income tax. If I’m working in Massachusetts one day a month do I have to pay state income tax only for those days I work there? I was hoping not to have to go there so I can keep that income that would generally be taxed if I worked in Massachusetts.

    • Since you are working in MA, you may be required to file a non-resident return. It is best to check with the State authority of MA to determine if you are required to file a Nonresident return. If you are, expertly prepares non-resident return.

  134. RST says:

    My current employer is in VA and only has operations in VA and NC. I plan to move to CA and work 30 hours per week part-time remote from my residence. Are there any requirements for my employer with CA to allow this? I will be the only employee working in CA to perform services only related to the VA operations.

    • Although certain states have varying non-resident tax laws, generally, if you live in one state and work in another remotely (so you don’t physically travel to another state for work), then you would only file and pay taxes to your resident state.

  135. Troy Stevens says:

    I am a US citizen employed by a US company. I recently followed my French wife to France and am working remotely from home on US based projects. My employer is a multi-national company with an Op-Co in France, which I visit periodically. However there is no protocol for my situation and they cannot provide information whether my situation would trigger foreign corporate taxes. On a personal note, the concern is related to my US taxes and French taxes.

    If I reside in France and work for a US co. on a normal “at-will” employment (i.e. not a contract employee), with a US tax address and have my normal taxes removed from pay – does it really have an impact on my US personal taxes?

    Also, when I pay my french personal taxes – can I use this as a credit/deduction on my US Federal taxes?

    • Since you are a US citizen, even if you are residing outside the US, you are subject to U.S. federal income tax and reporting on your global income. This includes income paid to you as compensation from a foreign company. Citizens living and/or working abroad must annually report all of their income to the IRS, whether the income is from U.S. sources or foreign sources and whether or not the income is taxed or reported in the new country of residence.

      However, the US has provisions that prevent double taxation. Such provisions include the foreign earned income exclusion, foreign housing exclusion, and the foreign tax credit. These provisions can reduce or eliminate the U.S. federal income tax that would otherwise be due by you. Keep in mind, that even if no U.S. tax is owed, a U.S. tax return still must be filed in order to benefit from these provisions. Failure to do so can result in severe penalties.

  136. Chris says:

    Hello. I live and work from home outside of Philadelphia. I will be working under a 1099 for a company based in Philadelphia but will still be working from home. Do you know if I will need to pay the Philly wage tax?

    Thanks for any advice.

  137. Beth in TX says:

    I live in Texas and my husband recently took a job in Illinois and is living there. I have started a business and am beginning to see a profit. If we file jointly, will Illinois attempt to collect state income tax on my business earnings since it will be reported from a Schedule C. Should we file separately?

    • Hello Beth,

      Since there is no state tax in Texas, you will not file a Texas state return. However, Illinois will tax your Spouse’s income. It is entirely up to you to choose a married filing separately or married filing jointly filing status. A married filing jointly filing status requires both parties to share any debt/tax liability and you will have a greater standard deduction as opposed to married filing separately.

  138. Chad Whaley says:

    My question is as follows: I currently live in Florida but plan to move to NYC. I sell areal Estate so many of my deals will not close until well into 2018. They went under contract recently July 2017. Will I have to pay taxes to NY and NYC on the remaining commissions I receive from Florida?

    • Hello Chad,

      If you move to New York and lived in New York for less than 12 months then you will be considered a Part-Year Resident. During this time, if you received income from Florida, you will not be taxed on income earned in Florida unless New York is your Resident state. Resident states tax all income.

  139. Jeff Smith says:

    I just accepted a job from a company that is headquartered in NJ. I will be working remotely from my residence in MD.
    Will I owe taxes to both states? Which state should I request my employer to withhold taxes for?

    • Typically any income that you earn in another state is subjected to taxes as a non-resident. Your residential state, however, will tax any and all income earned, regardless of sources or state boundaries. The information will be shown on your income statements when you receive them and give you a clearer indication as to which states you must file a state form for. You can, however, discuss your options with your employer.

  140. Christine says:

    Hello. If I worked remotely from my home in Nevada as an independent contractor for a company based in California, would I be subject to California state taxes (non-resident)? From what I’ve read above, it appears that it’s based on how the company in California files, and I could reference a W2 for further information on how to proceed. However, I’ve received at 1099-Misc, not a W-2 from the company. My 1099-Misc had none of the state or federal boxes filled in. Are there different rules/allowances for 1099 non-resident workers? Also, how do we determine what the proper tax rate is? I’ve received a tax bill from the FTB for a random amount, and I don’t know how they’ve derived their figures. Thank you in advance for your guidance.

    • It seems that your employer may have reported your earnings in CA to the Revenue and Taxation Department of Finances in California. Since you have been billed by the FTB, it’s in your best interest to file a state return with CA. Any and all income that you earn as a non-resident is subjected to taxes within the state that you have earned it in. However, if you are a resident of a state, all income will be subjected to taxation regardless of where it was earned.

  141. Marie says:

    I am a current resident of Florida and work remotely from my home office. My company is headquartered in NC and I have been having NC state tax taken out of my payroll. Is this accurate?
    If what I understand from this article and previous comments is correct, I should not have state tax deducted from my pay?
    Thank you for the clarification!
    In addition, I may have to relocate to NC within the next 8 months… in this instance, will I only pay state tax to NC starting at the time I claim residency?
    Your confirmation is greatly appreciated.

    • As a non-resident of NC, your income is subjected to taxes in the state that your income was earned in. The state only has the right to tax the income that was earned in that specific state. However, your resident state has the right to tax any an all income that you have earned throughout the year, regardless of state boundaries. Your taxes are being withheld accordingly and are correct.

  142. Mandeep says:

    I am an employer in CA and we recently hired a resource who is working from home in NJ.
    Now can someone help that how much taxes should we need to deduct? I mean is it only NJ taxes or CA taxes as well.
    we have hired one online payroll company who have asked us to apply for CA withholding and unemployment account and both the accounts for NJ as well so that mean I have to deposit amount in both the states ?

    • It would be best for you to speak with a local accountant or a CPA of your jurisdiction on how you should proceed with filing taxes for your out of state resources. Typically withholding taxes in the state that the income is earned in and having your employee filing a resident and a non-resident return will suffice. Or you can choose to withhold taxes in their resident state to convenience them.

  143. Matt says:

    Hello,

    My wife and I own an LLC (S-corp election) are the only 2 owners and only 2 employees.

    The business is located in Idaho however we both work remotely. For 6 months of this year we lived and worked in Idaho and now moved to Washington state permanently.

    We both (and the LLC) has deducted Idaho withholdings, however now that we moved to Washington to live and work remotely – we are at a loss as to how the LLC taxes us being the only two employees, if we are responsible for paying unemployment insurance (as we are operating partners) and if we need to at all register with WA state for anything.

    All income is earned in WA and since there isn’t an income tax I assume there is no need to file a state return there for income earned and with the LLC there shouldn’t be a need to file for a business licence in WA state, pay unemployment insurance there or even B&O tax as the company is located in Idaho.

    Thanks for any help and suggestions =-)

    • Hello Matt,

      If the business has no revenues in WA, you do not need to file an excise tax return and pay the B&O, Sales tax, etc. If you only have revenues in and operating in Idaho, you pay Idaho taxes only.

      Corporate Owner Officers who are on a payroll earning income and who provide services in Washington are automatically exempt from unemployment insurance unless they specifically request to cover them. Plus WA state has no income taxes so no need to file employment states tax forms. It looks like you do not need to register for anything but continue to pay the Federal employment taxes.

      You may refer to this link for WA State: http://business.wa.gov/run.html

  144. John says:

    I am a US citizen. I work for a US company and currently reside in Ohio. I am following my wife to Costa Rica for her position, but am going to continue working remotely from Costa Rica for my company in Ohio. My address in the payroll system will still be an Ohio address. My employer said that they will still be required to withhold Ohio taxes from my paycheck, even though I may be able to get them back when i file my taxes. Is this accurate?

    • If your taxes are withheld within the state that they are earned in, the state will tax the income earned. All non-resident states that have an income tax have the right to tax any income that is earned within that state.

  145. Oleg Baranets says:

    I moved from CT to TN and started working from home going forward in the home office. The employer changed the address but said it will continue withholding CT income tax even though TN does not have state income taxes for employees. Is this right? Should I get the refund at the end of the year after filing the return? I would prefer the payroll stop withholding CT taxes going forward. Can you please advise what is the right course. Thank you

    • If you are earning income as a non-resident with a state that has an income tax, the nonresident state has the right to tax any and all income earned there. As to specific regulations and tax laws, it may be best to consult with a local account or a CPA.

  146. Karen says:

    My husband and I currently live in West Virginia. My husband commutes into DC and works from home part of the time. We pay West Virginia state taxes. I am considering taking a job in Tennessee. If we make our home in Tennesse and my husband commutes into DC will he have to pay DC taxes since Tennessee only taxes interest and dividends.

    • Because you are moving to a residential state that does not tax the income earned within that state, any other states that you may be working as a nonresident will still be able to tax your income that you earn there. You will only be taxed on the income earned within that state and will not need to pay the same taxes that you have been in West Virginia when you move to Tennesse.

  147. Amy says:

    My husband and I own a house in NY. Our kids and I reside in the house and I earn wages in NY. My husband resides in a rental and earns wages in Illinois. Does he have to pay NYS taxes on his wages because his name is listed on the mortgage with mine? He did get credit in NY for what he paid to Illinois, but We owed NY lots of money, was told not a high enough percentage was kept from my smaller paycheck to cover our combined income. Can we file a joint federal return and separate state returns? We owed NYS lots of money due to his high income, although he is technically not a NY resident. I’m nervous our taxes may not have been prepared correctly last year…advice please!

    • Hello Amy,
      You can choose to file separately for state returns. According to your clarifications, your Spouse got a credit to NY (Resident state )for taxes paid to Illinois. Are you saying your Spouse is neither a Part Year Resident or Resident of NY?

      • Amy says:

        Thank you.My husband resides in Illinois yes, tax prep even had a copy of his ILL license. We were told because his name is on our house as owner (mortgage interest statement) that we have to pay NYS tax on his income. And they gave us credit for what he paid to ILL as a non-resident. Our bank will not remove his name from mortgage, as he is the higher income holder. Should we file joint federal return but married filing separate ( him resident of ILL/earned income ILL and me NYS resident/earned income) for each state?

  148. Nicole says:

    I will be working for a Connecticut based company from home in Tennessee (must work from home). Do I pay taxes in both states? Or file both but only pay my home state?

    • Tax Advisor says:

      Any income that is earned in a nonresident state is subjected to the state taxes there. However, this is also dependent on how your employer chooses to report your income information, and which state they report to. You will be able to determine whether or not you will have to file two state tax forms when you receive your income statement. This will appear on boxes 15-20 on your W-2, specifically what is shown in box 15, if it shows Connecticut or not. If it does and a state tax is withheld, then it will be necessary for you to file with that state.

  149. Kayle says:

    Hello. My husband and I just bought a house in California and are planning to move at the end of 2017. We live in New York City now. We are both planning to stay with our current companies and work remotely. My company would like to keep me attached to the New York office since as I understand it, there are tax implications for having an employee live in CA. I imagine my husband’s company situation will be similar. I understand that we will have to fill a non-resident for NY and a resident for CA. Will we also get a credit for all of our NYC taxes that we pay? Are there any penalties for not paying CA taxes all year and then paying when we file?

    • You will have to file Non-Resident NY and Resident CA returns. You should receive a Resident Credit from CA for taxes you paid to New York to avoid double taxation. However, it is not guarenteed the credit will cover all of the taxes paid to NY. There should not be a penalty for not paying CA taxes all year. Please refer to the CA FTB for further information about estimated tax payments (https://www.ftb.ca.gov/individuals/faq/ivr/208.shtml)

  150. Briana says:

    Hello! My husband owns a business based in Florida and we just moved to South Carolina. He works remotely and is a w2 employee.. does he have to pay both taxes ? How does it work?

    • Tax Advisor says:

      If you are now considered South Carolina residents, you will need to pay residential taxes on all income that you earn throughout the year, regardless of which state it is earned from. You can choose to have the taxes withheld throughout the year for payroll or pay off the liability when it comes time to file with South Carolina.

  151. B morgan says:

    I am so happy to see this blog. I have lived and worked from my home as a sales rep in Vancouver WA with occasional travel to Oregon to see customers ( maybe a total of 20 hours a month). For 12 years now and worked for 2 large companies I have never had to pay Oregon state income tax- I just started at a new large ( huge) pharma company and on my first check yesterday they took out Oregon state income tax!?!!!. Payroll said that because my territory shows Oregon that I have to pay oregon state income tax!? In the last 2 weeks I spent zero days in Oregon and have just had home study in Washington state. This makes zero sense to me . What can I do? — thanks in advance for your quick reply.

    • Hello,

      It is normal to pay state taxes to the state in which your employer considers its home state, in which case it is possible your employer’s home state is OR. And usually if you work in a state other than your own, you would file a Non-Resident Return for the state you are employed in. However, it sounds like they can assign you to a “territory” other than Oregon. Please inquire with your payroll department to fix this if they offer other territories. Thank you.

  152. Kelly says:

    Hello! I just got a new job working remote! I reside in MD and my job is based in VA. Now I understand MD and VA are reciprocity states and I did file a VA-4 form for exemptions from VA withholdings but my employer is telling me that I am not exempt and that they will deduct VA taxes. Is this True? Is this a decision thr comoany makes- whether or not they will be willing to deduct MD taxes even with the proper forms submitted?(ie VA4 form)
    She tells me to meet with an accountant. Does this mean I will have to file with MD and VA? So basically I am paying twice the amount of taxes? Would actually commuting be more beneficial monetarily in regards to tax returns? Will I have to pay more to MD at the end of the year even if the VA taxes are refunded? Please help!!!!

    • Your employer does not seem to be following state policies. However, to correctly file your returns based on how your employer is reporting your income, you would have to file a Resident MD and a Non-Resident VA return. Don’t worry, to avoid double taxation, you should receive a Credit on your Resident MD return for taxes paid to VA.

      • Kelly says:

        Thanks! Spoke with her today. Apparently the company I work for doesn’t have a tax account with MD, only VA. Does thay sound right? So she said she will try to work on it for thr new year od 2018. I will definitely have to do my research and see if the money refunded from VA taxes will cover what I will have to pay MD

  153. Clare says:

    I live in AZ and work remotely for a company based in OH. My employer withholds OH income taxes instead of AZ and refuses to take out AZ income taxes saying it is too expensive to set up another state withholding for just 1 person. I do not travel to OH to do any work. Every year I must file an OH nonresident return then file an AZ resident return. I wan to increase my OH withholding allowances to more than the number of my Federal allowances. Even though OH has a separate withholding form, my employer insists the Federal and OH withholding exemptions must be the same number. Is this true? Having to pay double state taxes every year (OH from paycheck, AZ estimated to avoid penalties) is expensive.

    • Please contact Ohio Department Of Taxation for answer about whether the state’s W-4 has to match the federal W-4.

      It is completely normal for an employer to withhold taxes from where they operate (and not from where you live or work remotely). Furthermore, you should not be double taxed by AZ. When you file a Resident Return (AZ), you should be receiving a Resident Credit for taxes paid to the Non-Resident State (OH) to offset the double tax. Thank you.

  154. Samuel says:

    I live in san diego,ca and am working for a company Head quartered in arizona. My job is mostly travelling all across USA and overseas. Should i be filing for non-resident tax? How should i file my taxes given my case. thanks.

    • You would have to file a Resident Return for the state that you live in (CA), and a Non-Resident Return for every other state your employer withheld taxes for (Boxes 15-20 of your W-2 Statement).

  155. Renee says:

    Hi,
    I just moved from CO to SD, I work remotely from home in South Dakota. My company says they have to tax me CO state income tax because they do not have a location in SD and have not opened up taxation. They are located in 46 states, I am the only employee in SD.

    Now they are taxing me again for CO, my question is how do I file my taxes? Can I recoup and of the CO Tax dollars? SD has not state income tax.

  156. John says:

    Hi,

    I am currently employed in TX but looking to relocate to CA after getting engaged to a woman out that way. I am able to work remotely, but my employer does not want to deal with the CA tax laws.

    If I were to get the company write up a 1099 paid to my LLC (based in Texas), and I got an annual W-2 as an employee of my LLC, would I be able to take full responsibility for the CA tax situation? Based on your article I would still be subject to CA income taxes, but if I would think that my LLC would be responsible for compliance with CA tax law as my employer, and the company contracting me for my services would not need to involve themselves. Is this correct?

    • The payroll tax is put in place for an ease of convenience so that enough of your income gets withheld in hopes that you won’t have to face a large tax bill when it comes time to file.

      Your employer can still handle your W-2, however, you won’t have any of your income withheld for CA for your TX company. You will need to ensure that you have enough funds at the end of the year to pay the CA State taxes, or you can choose to make quarterly payments to CA, which you will be able to report on your return for credit.

  157. Durga Prasad says:

    Hi, I am an Indian citizen and have recently been authorized to work in US on an L1A Visa. Our Headquarters in US, is based out of Woodbridge, NJ, but I will be working from Dallas, Texas. As Texas is an Income Tax free state, I understand, I would not have to pay any income related tax there. Would I have to pay any taxes in NJ State, even without living there?

    Regards,

    Durga Prasad

    • Tax Advisor says:

      The income that you earn is based on where you will be making it from. So if you are present in the State of Texas, as you are making the income, your income is subjected to taxes in that specific state. As you had expressed Texas is a tax-free State, so a State tax return is not necessary for filing.

  158. Carla says:

    Hello,
    Please advise-I live in Utah but am working part time remotely for a company based in Florida. What do I need to do to have Utah state tax withheld from my earnings?
    Since FL is a no-tax state, will I be required to file taxes in FL?

    Thank you

    • Tax Advisor says:

      As FL has no taxes on income earned within the State, you are not required to file a return with FL. However, for which State your company chooses to have your taxes withheld in, will need to be discussed with them. It’s best to speak with your payroll on a request to have your taxes withheld in Utah if there is an option for this.

  159. Chelsea says:

    Hi,

    I love and work full time in Hawaii, but I am going to start telecommuting for a second part time job in Washington. Do I need to file taxes for both states, or just Hawaii?

    Thank you!

    • If you are telecommuting for work in the State of WA, you will only need to file a State return with your resident state. Washington does not have taxes imposed on the income earned within the State.

  160. Justin says:

    Hello,

    I live in NH, but work in Mass. However, I recently started working from my NH home 4 days a week with 1 day a week in Mass. How do I file my taxes when it comes to my time working in the office vs working from home? Do I just add up the income I made during the year working in Mass and not in NH and file that number or is there a different step I am unaware of? Thanks for the help.

  161. Rich says:

    I live and work remotely in NH my company is based in MA they take state MA income taxes out Can i get these refunded when i file?

    • Even though you are working remotely from NH, the income that you earn, depending on your employer, can be subjected to the State taxes where this income is earned in. If you had any excessive income withheld in the State of MA for taxes paid, the State will refund you the excess amount.

      • Henry says:

        I am in a similar situation. I have asked the same question in various forums but the answer seems to be always indirect. I lives in IN and work remotely for an MO company which withholds MO tax. This is what I plan to do: File IN resident return with all my income. File nonresident MO return with 0% tax liability since I have not set foot in MO at all for 2017. This way I will get all MO withholding back.

        Anyone, feel free to comment.

  162. Aly says:

    I have a printing company in NY and one of my employees moved to NC for their own reasons to be near family. The job performed could be done in NY but it is ridiculous to expect the employee to return to NY when all her work can be done on the computer. Should I withhold NY or NC taxes from her paycheck and if NC then will I also have to file for sales tax for my NC customers as well?

    • For convenience for the employee, it’s always best for the employer to withhold taxes from the state that they are remoting from. However, there are tax rules and regulations, which you may need to consult a local CPA for further advisement on these matters. Even though you are withholding New York taxes for your employee, they will still be able to file a non-resident New York return and a full year resident return in North Carolina. They will be able to allocate a non-refundable credit to their NC state return for taxes paid to NY.

      For the sales taxes for NC customers, consulting with a local CPA would be for the best.

  163. Sarah Phillips says:

    hi. We live and work in CA. We are thinking about moving to Utah but my husband would commute to California Monday-Thursday. How would we deal with the taxes?

    • If your spouse will be residing in UT as their domicile state but traveling to CA for work, they may be subjected to taxes in Utah for the income that they earn in CA. The income that they earn in CA will still be taxed in the respective state, however, when it comes time to file your state returns, you can file a non-resident California return and a full-year resident Utah return. This will allow you to allocate a non-refundable credit for taxes paid to another state from CA to your UT return.

  164. rachael kay says:

    question concering being a non us citizen and working for a US comapny that only is online. Examples, airbnb and uber. the transactions are from online. Would this person get a 1099 misc? or what do companies give out when the person is from another company and how to the company record this to the IRS? i am doing some research for my marketing class.

  165. John says:

    I own a home in suburban Maryland. It has been and continues to be my primary mailing address (20 years).

    I am considering renting an apartment in DC where I work. I expect to stay in that residence 3 nights a week for ~ 40 weeks a year or 120 nights.

    I do not expect to change my mailing address. Do I need to file taxes in DC?

  166. Jessica says:

    My main residence is in Washington state and I’m a self-employed engineer. I have licenses to work in Washington, Oregon, and Idaho. I pay B&O tax in Washington and file returns in Oregon and Idaho. I have a winter home in Arizona where i stay a few months out of the year and work remotely. None of my clients are in Arizona and I’m considered a nonresident of Arizona. Do I need to file a return and pay tax in Arizona?

    • If you rent out your AZ home, you will need to file a non-resident tax return to report any rental income an expenses. Additionally, you can take a deduction on your federal taxes for mortgage interest and property taxes you may have paid for the home.

    • The income that you earn while in Arizona will be subjected to state taxes, so it would be best to file a non-resident return and allocate the income accordingly.

  167. Anon says:

    An extra complicated situation:

    I am going through the hiring process with an organization that is not its own legal entity — this international “network” and its staff are instead hosted by various non-profit orgs / NGOs based around the world. In the US, we are hosted by a large non-profit that is registered in many states — but not my current state of residency, New Mexico. HQ of the hosting organization is based in NYC, but they also have offices in Atlanta, GA, where I have family based / an address I could indicate as my own.

    I never need to work on site at our host agency offices — I work entirely from my home in NM, and my boss & coworkers within the network itself also work remotely in similar arrangements, though they happen to live in states where the host agency is registered. Still, I am being encouraged to indicate to our host agency’s HR that I am “relocating” to either GA or NYC. Our network and its hosting agencies have employees that work all over the world, so I’m not sure why this is so touchy — I think they just want to get me on board quickly. I just need to know if I am going to have any tax / audit issues down the line if I live in NM, file my own income taxes here, but the host agency is completing my hiring paperwork and sending my paychecks with the assumption of either GA or NYC residency.

    Whew, know this is a doozy. Thanks for your insights!

    • These situations can be confusing, generally, if the employer indicates the income was earned in a state that is not your resident state you are required to file a resident state return for the state you live in and also file a non-resident state return for the indicated state.

  168. Emily says:

    Hello. I’m a resident of Florida, but I’m an independent contractor for a company in Georgia. What does this mean for me in terms of tax?

    • If you received a 1099-MISC from your employer in Georgia, you will need to file a non-resident state tax return with GA for the income that you earned in the respective state. All income earned within a non-residential state is subjected to taxes within that state.

  169. Phyllis says:

    If I am a US citizen, full-time teleworker, permanent residence in AZ, employee of a US company based in MN, and I chose to spend 6 months of the year working in Mexico, would anything regarding taxes have to change or would it remain as is with AZ state tax withheld (along with the federal taxes, etc.)?

    • Since you’re a US citizen and you earned income in Mexico, you’ll need to report all your income, whether it was earned in the US or abroad. You can do so by filing a foreign income tax return. You might qualify for foreign income exclusion.

  170. John says:

    Hi, i am from Singapore. I work remote for US company.
    So could you tell me how is tax calculated in this case.
    Thanks.

    • It may be best to contact your company to request advisement on this matter, specifically your payroll department. You may also want to speak with a CPA on this matter as well because your situation pertains to international taxes and income.

  171. Kay says:

    Hi, If I live in TX, travel to CA and work there Mon – Thu. I fill Texas as residence in W4 when I join.
    Do I still pay income Tax for CA?.

    If Yes, what are the benifits of doing a C2C and filing it from TX rather than W2?
    Is C2C really worth doing it ? or should I stick with W2 if the taxes doesn’t matter.
    Thanks,

    • The income that you earn in another state as a non-resident is subjected to taxation in the state that is earned in. Reflected on your income statement, depending on which state is shown, you will need to file for the specific state shown when it comes time to file in the coming tax season.

      A C2C is similar to a W2, however, it requires that you set up a corporation and identify yourself as a member of that said corporation. A 1099-MISC or a W2 would suffice.

Leave a Reply