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State Income Tax: Living in One State, Working in Another

Need to file state taxes when you live and work in different states?

Most people in the U.S. live and work in the same state, which makes state taxes pretty easy to understand – you pay taxes to the state where you live and work.

But what if you live in one state and work in another? Do you pay taxes to the state where you live? Where you earn an income? Both?!

You need to pay taxes to both. Most likely you will end up having to file a resident return in the state where you live and a nonresident return in the state where you work.

Resident return

Generally you need to file a resident return in the state where you are a permanent resident. This state has the right to tax ALL of your income, wherever it was earned. Continue reading “State Income Tax: Living in One State, Working in Another”

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How To File State Taxes If You Have Dual State Residency

If you live in one state and work in another, you’ll need to file two tax returns

When it comes to filing state taxes, it can get confusing, especially if you spend time in multiple states. You may be wondering if you can even be a resident of two states or if you’ll need to file taxes to more than one state.

The RapidTax team is available to help you with tax questions you may have. In fact, you’ll be able to report your income from multiple states with RapidTax!

There’s a variety of reasons why you consider yourself a resident of more than one state.

For example, you could;

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The Top Ten States for Military Retirees- Part Two

In The Top Ten States for Military Retirees- Part One, we gave you the top five best picks to spend military retirement in. Five others fall among the best states for military retirees.

In the top ten states for military retirees part one,  at the top of the list, in the number one spot was Florida, followed by Texas, Alabama, Tennessee and Mississippi.Wondering what other states made the list?  If the top five didn’t catch your attention, maybe one of these will:

#6-Nevada: Are you a military retiree who likes to gamble? In sixth place is Nevada. Nevada has no income tax and no tax on retirement income and social security benefits. Although, there is a 6.5% state sales tax and there are also no property tax breaks for seniors in Nevada (perhaps you’ll win this back on weekend trips to Las Vegas).

#7-Washington: Washington ranks as the seventh best state to live in for military retirees. All retirees don’t pay taxes on their retirement income, social security benefits or pensions. Like Nevada, Washington has a 6.5% state sales tax and this percent can even increase to 9.5%, depending on the local tax.  There is a four property-tax relief program for seniors owning homes.

#8-Illinois: Illinois at seventh place, exempts retirement tax for military retirees and does not tax social security benefits.  The state sales tax is also 6.25% and can go as high as 10% in some areas. For seniors, there is a homestead exemption which allows $5000 reduction of the property that is paid taxes on. Illinois does not have an inheritance tax.

Continue reading “The Top Ten States for Military Retirees- Part Two”