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marypoppins51
New Member

I know this is dumb and I apologize. I live in SC and work in GA, I then file non resident state tax form for GA and get my tax dollars back so I can then file and pay SC

i do apologize for being redundant, but I need to understand before I take the job i do not want to pay tax in both states, thank you
1 Best answer

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SteamTrain
Level 15

I know this is dumb and I apologize. I live in SC and work in GA, I then file non resident state tax form for GA and get my tax dollars back so I can then file and pay SC

Here's how it works when you work in a different state from where you live.....and both states have an income tax (and there is no reciprocal tax agreement between the states).

________________________________________________

AFTER your Federal tax return is entirely filled out with every scrap of income entered, along with all your Deductions & Credits.

1) ....you must then first prepare your GA non-resident tax return.  GA will tax all of your work income performed in GA.  They may use your total income from everywhere to calculate the % tax assessed, but in the end, they only tax your GA income.   It is unlikely that you will get all your GA withholding back unless you have real low total income.

2).... then you prepare your SC tax return.  SC calculates a state tax on everything you earned from everywhere.....but then, in order to prevent double taxation, SC will allow you to take a credit for the taxes that GA "kept"  (which is why the GA nonresident tax return has to be done first).  There are questions in the software SC interview that cover Credit for Taxes paid to another state.

There's some mathematical handwaving if the SC tax rate is lower, but the software knows about it...i.e. if GA is taxing at 5% and SC at 3%, then SC only allows a credit up-to the 3% that SC would have charged.....but I haven't checked the two state rates, and it will depend on what your total income is for the year.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*

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2 Replies
SteamTrain
Level 15

I know this is dumb and I apologize. I live in SC and work in GA, I then file non resident state tax form for GA and get my tax dollars back so I can then file and pay SC

Here's how it works when you work in a different state from where you live.....and both states have an income tax (and there is no reciprocal tax agreement between the states).

________________________________________________

AFTER your Federal tax return is entirely filled out with every scrap of income entered, along with all your Deductions & Credits.

1) ....you must then first prepare your GA non-resident tax return.  GA will tax all of your work income performed in GA.  They may use your total income from everywhere to calculate the % tax assessed, but in the end, they only tax your GA income.   It is unlikely that you will get all your GA withholding back unless you have real low total income.

2).... then you prepare your SC tax return.  SC calculates a state tax on everything you earned from everywhere.....but then, in order to prevent double taxation, SC will allow you to take a credit for the taxes that GA "kept"  (which is why the GA nonresident tax return has to be done first).  There are questions in the software SC interview that cover Credit for Taxes paid to another state.

There's some mathematical handwaving if the SC tax rate is lower, but the software knows about it...i.e. if GA is taxing at 5% and SC at 3%, then SC only allows a credit up-to the 3% that SC would have charged.....but I haven't checked the two state rates, and it will depend on what your total income is for the year.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*
marypoppins51
New Member

I know this is dumb and I apologize. I live in SC and work in GA, I then file non resident state tax form for GA and get my tax dollars back so I can then file and pay SC

Thank you this is awesome, appreciate your time.

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