I live in Colorado. I have rental properties in Ohio & Michigan, both have a lower state income tax compared to CO. So will I not pay state tax on rentals to OH and MI?

[v54]

I live in Colorado. I have rental properties in Ohio & Michigan, both have a lower state income tax compared to CO. 

Colorado will tax me on the net income after depreciation, etc. So since CO has a higher tax rate (4.67%), does that mean I will not pay state tax on my rentals to OH and MI, respectively? Is my tax paid on those properties to my home state (CO) a 100% tax credit for OH/MI so I won't get double taxed?

I'm asking because I filed a federal extension and it sounds like OH/MI automatically grants a 6 month extension but if I owe, I should pay by April 15.

Thanks!

[Hal_Al]

You must fie non resident income tax return for both MI & OH, if you have a net profit on each property. You will pay tax to each state.

CO will also tax your net profit on both properties; but it will give you a tax credit on what you paid the other two states. Although there will be no net double taxation, you still have to file three state tax returns.

[v54]

So the state that actually gets the taxes will be the state in which the properties are located?

[Hal_Al]

Yes, when it all nets out. But you must report the income on both you your resident state (CO) return and a return for the state the property is located in.