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Level 1
posted Jun 29, 2020 12:57:05 PM

I was a year-long Iowa resident in 2019; worked remotely for University of Utah. Do I pay Utah state income tax?

incometax.utah.gov says a non-resident must file a Utah return if I had "income from Utah sources". That would lead to my paying UT tax on almost all of my income and Iowa very little.  Most posts I read in TurboTax and the web say remote workers should pay tax to the state in which I live and work.  Which is right in this case?  This question has literally been beating me up, so I will greatly appreciate a studied answer.

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1 Best answer
Level 15
Jun 29, 2020 1:59:29 PM

If you never actually (physically) worked in Utah, your income is not subject to Utah taxation.

 

Utah taxes non-residents only on Utah-source income.  Per Utah Statute 59-10-117(2)(c)(ii), compensation for services rendered outside Utah is not Utah-source income.

 

https://le.utah.gov/xcode/Title59/Chapter10/59-10-S117.html?v=C59-10-S117_2017050920170509#:~:text=59%2D10%2D117.,income%20derived%20from%20Utah%20sources.&text=(ii)-,constitute%20income%20derived%20from%20Utah%20sources%20only%20to%20the%20extent,the%20investor%20in%20this%20state.

 

1 Replies
Level 15
Jun 29, 2020 1:59:29 PM

If you never actually (physically) worked in Utah, your income is not subject to Utah taxation.

 

Utah taxes non-residents only on Utah-source income.  Per Utah Statute 59-10-117(2)(c)(ii), compensation for services rendered outside Utah is not Utah-source income.

 

https://le.utah.gov/xcode/Title59/Chapter10/59-10-S117.html?v=C59-10-S117_2017050920170509#:~:text=59%2D10%2D117.,income%20derived%20from%20Utah%20sources.&text=(ii)-,constitute%20income%20derived%20from%20Utah%20sources%20only%20to%20the%20extent,the%20investor%20in%20this%20state.