Do you pay both states or just one out of your pay check?
2007-06-11 13:28:20 · 3 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
You generally have a tax liability to both states. As a resident of AL, you are taxed by AL on your world wide income. If you work in MS, your income earned there is subject to MS tax. You need to claim the income in both states, however AL will give you a credit for the MS taxes paid. This has the net result of your paying tax at the higher of the 2 states rates.
There is an exception to this IF the two states have a reciprocity agreement. Some states do, such as NJ and PA, but I don't believe that AL and MS do.
2007-06-11 16:06:31 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Tax law will apply to the state you work in and not where you live-in.
2007-06-11 20:30:52 · answer #2 · answered by SGElite 7 · 0⤊ 1⤋
You only have to pay one. I would pay where I made the money.
2007-06-14 21:59:32 · answer #3 · answered by K M 4 · 0⤊ 1⤋