Mom is retired and lives with my sister in PA. She owns a vacation home in NJ. How do we follow taxes?

[seandin2020]

Mom is retired and lives with my sister in PA. She owns a vacation home in NJ. How do we follow taxes?

Her car, car insurance, retirement plans, etc etc are tied to my sister's address. 

How does this effect federal?

How does this effect state? (what needs to be filed in each state?)

thanks

Sean

[TomD8]

If her main, primary residence is in PA, then for tax purposes she is a resident of PA and she must file a PA tax return.  ALL her income would be subject to PA taxation.

As a PA resident, it is not necessary for her to file an NJ tax return unless she has NJ-source income.  One example: if she were to rent out her NJ vacation home, the income from that would be NJ-source income and she'd have to file a non-resident NJ tax return (in addition to her PA tax return) to report that income.

Her federal return is not affected by her state of residence.

[seandin2020]

wow thank you so much for the information.  Quick clarifying question:

1.  Does she have to file any state taxes in NJ?  She does NOT rent the condo, she just uses it when she wants to.

So make sure I understand this right:

- File federal as normal

- File State PA taxes(ie her retirement money , SS, etc)

- potentially not have to file any state tax in NJ

thanks!!

[TomD8]

Assuming she lived in PA all of 2021, and she has no income sourced in NJ, she does not have to file an NJ tax return.