I received an annual incentive plan payout in 2023 based on work done in 2022. Is that income for the state I worked/lived in 2022 or the state I worked/lived in 2023?

[Mike9241]

The incentive plan payout you received in 2023 is typically considered income for the state in which you worked or lived during the year 2023. The timing of the payout determines the tax year to which it belongs.

[TomD8]

It may be taxable by both.  A work-related payment is typically taxable by the state where the work was performed.  If you received the payment after becoming a resident of a second state, it would typically also be taxed there - on the principle that your State of Residence can tax all your income.

In those situations you'd normally be able to claim a credit on your current resident state's return for the tax paid to the non-resident state, so as to avoid double taxation.