@nicholas_peters_ wrote:
It's not exactly what I need to know but thanks for your help.
Generally speaking, you pay income tax in the state where you physically live, and where you physically work. If they are different states, things can get complicated depending on which states, because some states have reciprocal tax agreements and some don't.
More specifically, if you are an independent contract reporting your income on a schedule C, you will file a state tax return for the state in which you live, that reports all your world-wide income. If you physically travel to other states to work for some of your clients, you will owe a non-resident tax return for each state you work in, to report in-state source income. Then you file a resident return for your home state that reports and pays tax on all your income, and you get tax credits for taxes you paid to other states that lower your home state tax bill so you aren't taxed twice on the same income. If you work in more than 5 states, you may want to use a tax professional, because Turbotax has some limitation when you have more than 5 states.
If you are a W-2 employee, you owe a resident tax return for the state you actually live in. If you work in other states, you owe a non-resident return for the share of your income earned in those states. If you telework for a company in state A, but you actually live and do the work in state B, you owe a state B tax return but not a state A tax return,
EXCEPT that there are 6 states that will tax you if you work for a state employer even if you work out of state. These states are Connecticut, New York, Pennsylvania, Arkansas, Delaware and Nebraska. These states apply a "convenience of the employer" rule. If you live in another state, and work for an employer based in one of these 6 states for your convenience, you owe income tax to that state. If you work out of state for your employer's convenience, you don't owe tax to that state. Here is New York's memo on the topic, other states use similar rules.
https://www.tax.ny.gov/pdf/memos/income/m06_5i.pdf
Even if you are working out of state for your employer's convenience, you would owe in-state tax for any days that you travel to headquarters (such as for meetings, training, etc.)
