My primary business is in WA and the majority of my income is from this state. I am expanding to NY. I am assuming for now the main thing I must track is from which state my income is coming from separately. I am aware of the states city and state tax policies and am keeping up with those. Is this a situation in which turbo tax would provide guidance with when it is time to submit my taxes for this year? Are there additional things to keep in mind in regards to having income from these two states? Thank you!
Hi klnimada!
You will need to account for the income earned in each state separately. If the intent is to remain in Washington, you will need to complete two state returns. Washington being the resident state and New York being the non resident state. Any taxes that you are required to pay in the non-residential state will be used as a credit on the resident tax return.
If you are moving to New York, again two state returns will be required but both states are considered part year and you'd pay taxes separately based on the amount of income earned in each state as no credit is given in that case.
Thank you for your response! In these cases, would the deductibles have to be accounted for separately based on which state they are from? For example, if I were to have an expense in NY does that have to be separated from expenses in WA and then allocated accordingly? Or do they just fall all under the business total?