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Will state tax apply for IRA withdrawal if I move states

If I made traditional IRA contributions in California, I could save on state tax on the contribution in my state tax return.

But if I retire in a different state with no state tax, then I assume I don't need to pay any state tax on the withdrawals I make, even though I may have deducted it my earlier California returns.

Am I missing something here? Do I owe any tax w.r.t IRA contributions to the state of California during the year I make the move?
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5 Replies

Will state tax apply for IRA withdrawal if I move states

If you move from California which has state tax to a state which has no state tax and you take steps to establish residency in the new state, then for the year that you move, you will file a Part-year/Non Resident California tax return which will include any income, including IRA distributions, that you had during the time that you were a California resident. After you become a resident of the new state you follow the tax laws, if any, of that state.

Will state tax apply for IRA withdrawal if I move states

The deduction will be taxed in the state where you received the payments... it could be in a state that has no tax or in one that will tax it.  But the fact that you escaped taxes when you made the contribution doesn't matter. 

If you move to Florida or Nevada which has no state taxes then you just don't get taxed. 

Will state tax apply for IRA withdrawal if I move states

I AM TRYING TO FIND OUT IF I MOVE TO FLORIDA WOULD I STILL HAVE TO PAY STATE TAX IN NORTH CAROLINA ON MY EDWORD JONES  ACC IF I TRANSFER IT TO A FLORIDA ACC WITH EDWORD JONES 

Will state tax apply for IRA withdrawal if I move states

SO I WILL NOT BE RESPONSIBLE NORTH CAROLINA STATE TAX

TomD8
Level 15

Will state tax apply for IRA withdrawal if I move states

By federal law, retirement income is taxable only by your state of legal residence at the time you receive it

**Answers are correct to the best of my ability but do not constitute tax or legal advice.

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