Dual State Tax Issue

[striffmike]

Dear Tax Expert,

I work for the government in Washington DC and lived in Maryland for most of 2023.  I paid Maryland Taxes on all of my income.  I did not receive remote approval from my employer until December 17th 2023.  Since I am a federal-level employee I anticipated approval and sold my house in Maryland, shipped our cars to California and my spouse and I changed residency to California effective November 1st 2023.  However because I did not receive approval I maintained living with a friend in Maryland and working in DC until I received the approval. How do I file my State taxes?  I am assuming that since I continued to work in DC the income was not earned while living in California. Do I file as Maryland resident for the full year?

[DMarkM1]

No. You would file part-year CA and part-year MD returns.  With 1 November as the date your CA residency began. DC has a reciprocity agreement with all 50 states so you will not need to file DC.  

You will allocate income to MD and CA based on that 1 November residency change.  You may get a small refund from MD since all withholding was there.  You may owe CA some taxes for the last two months of the year residing there and no withholding.

In the "My Info" section you would indicate your resident state was CA on 31 Dec, select "Yes" you lived in another state, select MD and enter the 1 November date.  This will generate the part-year returns.