Is there a procedure for filing a final state income tax return?

[jrc0109]

We are establishing a new legal address this year, 2022 in a state that does not have a state income tax. We will be filing a  tax return for TY2021 for a state that does have a state tax. Do I need to inform that state that this will be our final state tax return? If so are there special forms?

We are both retired, have no jobs. We still own a home in the former state, but will be out of that state for more than 6 months and a day.

Thank you.

[HelenC12]

Please clarify. What state are you moving out of?

[jrc0109]

Out of NJ.  We purchased a home in a non-income tax state in 2020. We will be living in that home for more than six months in 2022 and are in the process of establishing it as our legal address. 

[ZoltanB45]

There is no necessary procedure to file a final state individual return like there is for a final business return. That being said, I have seen localities (NYC) question a taxpayer why they didn't file a city return that year. They then require proof that you did not live in the area. If the taxpayer is worth a lot of money, has  a business, they even go as far as checking cellular data to see if they were in the city a certain amount of days.

I only mention this, because you wrote "establishing as legal address." You might want to be in the other state most of the time.

[Hal_Al]

You say "We still own a home in the former state" (NJ).  But you don't say what you intend to do with it.  If you plan to split time, in the future,  between the two residences, NJ could well consider you to still be a full year resident for 2022 and future years.

You should review the residency rules. https://www.state.nj.us/treasury/taxation/pdf/pubs/tgi-ee/git6.pdf

That said, I agree with zoltanb, there is no procedure for notifying the NJ tax authority of you change in residence.  The fact that you file a part year resident return with a new address is sort of informal notification.

[jrc0109]

Thank you very much for the advice and reference.

I read several pages in the NJ Part-Year Residents and Nonresidents brochure and I am still confused. I think we can meet the factors that would demonstrate that New Jersey is not our domicile, but I am not sure we would still need to pay NJ state taxes since we would be in NJ about five months. It's very confusing.

[Hal_Al · Accepted solution]

 Since you  think you can meet the factors that would demonstrate that New Jersey is not your domicile, you do not need to file a NJ return, unless you actually have NJ source income; e.g. you work at a temporary job. The fact that you receive, for example, pension or investment income while temporarily in NJ does not make it NJ source income. 

[jrc0109]

Thank you very much!