State Taxes?

Question

If I work in a different state in which I live, do I
pay state taxes in the state in which I work or in my state of residence?

How difficult would it be for my company to figure out the W2 situation? Are there any online resources for this?

Answer 1

That depends. Some states have reciprocity agreements in place such that you would only pay tax in your state of legal residence. NJ and PA are a good example of two states with a reciprocity agreement in place.

If your state and the state where you worked do not have a reciprocity agreement in place, you will need to file a non-resident return in the state where you worked listing only the income earned in that state and pay any tax due. You'd then file a regular resident return in your home state listing all income from all sources and take a credit for the income taxes paid in the state where you worked.

Answer 2

You pay taxes in both states. In the state you do not live but work, you file a Non-Resident Return. In the state that you live but do not work, you file a Resident State Tax Return and you receive a credit for taxes paid to another state.

Consult a tax practitioner or CPA to do your state taxes. Its in your best interest to do so.

Answer 3

Depends on your state laws and if you have a tax liability. No state is ever going to refuse any kind of money from you if you are made legally responsible. Your residence has more to do with it than location of your labor.

Answer 4

If you physically work there (ie you commute there every day) then you have to pay the taxes there. If you work for a company that is headquartered in another state, you pay the taxes of where you work.

Answer 5

usually in the state where you live.
that is how it works in my state (i work in one state and live in another).

you still have to file a return for both states, but you file a return as a non resudent and don't wind up paying much if any to the state where you work.