lived in multiple states

[hackech]

worked in PA all year, owned house and lived in NJ.  Sold house in May, and moved to apartment in Pennsylvania.   Bought house in South Carolina and switched license to SC in September, but continued to work remotely in PA due to COVID.  I still rent apartment in PA for and will stay there once work returns to office.  Where do i file state taxes, and in what order?

[ErnieS0]

File Pennsylvania and New Jersey tax returns—and possibly South Carolina.

If you worked in PA lived in NJ, your employer should have withheld NJ tax from January to May. File a part-year NJ return for that period, reporting your PA income earned while living in NJ. It should be listed as NJ wages in Box 16 of your W-2.

From there, I’m not sure. You bought a house in South Carolina but kept an apartment in PA. Did you live in South Carolina for a majority of the time after you bought the house? Did your employer withhold South Carolina tax?

Even though you obtained a South Carolina driver’s license, you did not abandon your PA residency because you have a place to live in PA, earn PA wages and said you will stay in your apartment once work returns to your PA office.

Unless your employer withheld SC tax or you spent most of your time in South Carolina, I would say to file a part-year PA return from May to December.

If your employer withheld SC tax and/or you spent most of your time in SC, then you would file a part-year PA and part-year SC income tax return. All your income from May to December would still be taxable to PA because you continued to telework there. It would be taxable to South Carolina for the same period because you lived there. SC will give you a tax credit for PA tax.

[hackech]

Thanks for the reply.   I have the apartment in PA until I retire in 2 years.  I've been in SC since May due to covid, working remotely.  Not sure when we can return to office.   I changed my drivers license to SC, registered cars in SC and registered to vote in SC in September.   Employer did not withhold SC taxes, just Nj until May and Pa rest of year.

[ErnieS0]

At this time, due to COVID-19, I think you should file a part-year New Jersey and part-year Pennsylvania income tax return, even though you took steps in September to establish residency in South Carolina.

Pennsylvania says if an employee is working from home temporarily due to the COVID-19 pandemic, the Department of Revenue does not consider that as a change to the sourcing of the employee’s compensation. In other words, you remain a Pennsylvania-based employee because you were before the pandemic (though working from NJ).

Your “tax home” is still PA due to your apartment so I don’t think you need to file a SC return at this point.

The IRS says, “generally your tax home is the entire city or general area where your main place of business or work is located, regardless of where you maintain your family home. For example, you live with your family in Chicago but work in Milwaukee where you stay in a hotel and eat in restaurants. You return to Chicago every weekend. You may not deduct any of your travel, meals or lodging in Milwaukee because that's your tax home. Your travel on weekends to your family home in Chicago isn't for your work, so these expenses are also not deductible. If you regularly work in more than one place, your tax home is the general area where your main place of business or work is located.

Once the pandemic emergency is over, you should talk with your payroll department. At that point, you may be a South Carolina resident.

[TomD8]

@hackech wrote:  "I've been in SC since May due to covid, working remotely."

Earnings from work carried on in SC is SC-source income, and thus taxable by SC.  See SC Income Tax Code, Section 12-6-1720 (1)(b)

https://www.scstatehouse.gov/code/t12c006.php#12-6-1720

Depending on PA's rules for the situation, it may also be taxable by PA.