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New Member
posted Jun 4, 2019 9:46:27 PM

Does it matter which state return I fill out first?

I have to file in two states because I have rental property in a nonresident state.

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1 Best answer
Level 15
Jun 4, 2019 9:46:30 PM

Complete the non-resident state tax return first.  Then the resident tax return.

11 Replies
Level 15
Jun 4, 2019 9:46:30 PM

Complete the non-resident state tax return first.  Then the resident tax return.

Level 2
Jan 23, 2020 1:21:53 AM

is there a reason for this?   

Level 15
Jan 23, 2020 4:00:04 AM

Yes. Your resident state will give you a credit, or partial credit, for the tax paid to the non resident state. So, the non resident state tax must be calculated 1st

Level 15
Jan 23, 2020 6:58:51 AM

@bob667 --  There are a few exceptions to the "non-resident return first" rule.  The exceptions all involve California.  Post back if one of the states involved is California.

Level 2
Feb 6, 2020 6:50:53 PM

yes, its California...thank you

Level 15
Feb 7, 2020 6:33:43 AM

@bob667 --  In which state do you live, and in which state do you work?

Level 2
Feb 8, 2020 11:49:02 AM

thank you for your time!  I live and work remotely in Hawaii all of 2019 for a company in Cal

Level 15
Feb 8, 2020 12:19:22 PM

@bob667 -- Are you a W-2 employee, or an independent contractor who receives a 1099-MISC?

Level 2
Feb 8, 2020 1:56:41 PM

i am W2 employee...thank you

Expert Alumni
Feb 9, 2020 1:01:19 PM

California does NOT tax non-resident telecommuters. 

You do not owe California State Income tax on that income. If California tax was withheld, you can file to get that tax refunded. 

 

Level 15
Feb 9, 2020 2:06:10 PM

<<"i am W2 employee...thank you">>

 

@bob667 — Then your income is not taxable by California.  But it is fully taxable by your home state of Hawaii.