question on taxes what state do i use?

Question

hello this past year i lived in diffrent states. The first 7 months i lived in AZ then I moved to Colorado, now i just moved back to minnesota. how dose all of this work.
Thanks

Answer 1

Not filing taxes is about the worst thing to do, unless you have good reason to do it.

First question. Is Minnesota now your state of residence? If so, you'll need to file a part year resident income tax return there.

For Arizona and Colorado, it depends on how much you've earned and if they withheld any state taxes.

For example, if you didn't work in Colorado at all then you'd have no requirement to file there. But if you worked in both (or all three states), and had state taxes taken out, you'll want to file non-resident returns there. If it works out you had no income tax there, that's great and you get your money back.

Typically, all income from your federal return is taxed on your state return. Then, if you have any taxes paid to another state, that amount is usually taken as a credit against your home state's tax.

However, I should ask something else. Are you planning on moving again? Will you be moving state to state frequently intending on settling back to your state of origin. If so, there might be argument that you've never moved tax residence and every other state will be non-resident.

That still means you have to file a tax return in each state you've worked in (if required).

This year it might be a good idea to pay someone to do your taxes.

Good luck!

Answer 2

You should file a state return for each state that you lived in OR worked in IF that state has an income tax. The returns can be a little tricky because you effectively are pro-rating your income over the amount of time you spend in each state. Be careful not to over-pay by including time spent in each state that adds up to more than 365 days. (If you moved to MN in 2007, that won't affect your 2006, so maybe you only have to do AZ and CO.)

Answer 3

Ask your tax consultant. I would think the state you lived in the most though. I moved from one state to the other and lived equally in both states but when I filed it was the state I lived in prior to moving. I had no problem with my taxes that year as far as an audit. The following I filed in my new state.

Answer 4

Do what you want I would not file state taxes. The first two states only give a credit to the state you live in. The state you live in wants you to file if you lived there all year long (at lease claimed resident). You may loose on future credit for paying taxes for this year, but the headache for the no gain is not worth it.