Do I need to file a tax return in Indiana and Kentucky?

[Caitlinkay13]

At the beginning of the this year I was still in school in Kentucky, and held a job while I was. During this time, although I lived in Kentucky, my residency was still considered to be Indiana because of my drivers license and other stuff. The end of may I made the decision to stay in kentucky and change my residency. I'm still at the same job. I just permanently changed my residency. Would I need to file an Indiana return even though I didnt earn income in that state?

[MaryK1]

Your status for 2018 was Part Year resident of Kentucky and Indiana so we must look at both state laws separately and comply with each.

For Kentucky:

Persons moving into Kentucky must report income received from Kentucky sources prior to becoming residents and income received from all sources after becoming Kentucky residents.  Reciprocity does not apply to persons who live in Kentucky for more than 183 days during the tax year.

This means you would file Part Year Kentucky and report all of the income you earned.

For Indiana:

If you were a part-year resident and received income while you lived in Indiana, you must file your Indiana income taxes.  A general rule of thumb is to file Indiana state taxes if your income is $1,000 or more.  If you made more than $1,000 and have to file an Indiana return, you would apply the credit for taxes paid to another state because you must report all of your income in Kentucky (see above).

In addition, if you had Kentucky withhold for Indiana (because of the reciprocity agreement), you would want to file in Indiana regardless to get the withholding back.