Mulitple states

Forum|Forum|4 years ago
March 21, 2022
3 replies
9 views

I was a NY state resident through August, then moved full time residency to MD. TT is calculating state taxes and it looks like full taxation for my income in both states. Seems like I should be getting credit for one or the other state filing, correct? Should one be filed first and then submit the credit for the other?

DMarkM1

Level 15

It depends. Please clarify did you change jobs/work states?

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HandyAndy2Author

Level 2

No, I didn't change jobs, same job, just working remotely in MD. MD is my new permanent state of residence. Just seems like I shouldn't pay full state taxation in two states.

DMarkM1

Level 15

You are correct. MD is only going to tax you on the income earned while living in MD. NY however is going to tax you on the income earned while a part-year resident and the income earned while remotely working in MD (so all the income). You will claim a credit on your MD part-year resident return only for the tax on the income taxed by NY while you were a resident of MD.

I suggest completing the NY return first. First time through the NY interview indicate "No" not all the wages belong to NY. Only allocate the non-resident part of NY wages to NY. Go through to the end and note the income and income tax imposed by NY on the non-resident income. That will be used on the MD return for the credit for taxes paid to another state.

You can then go back through the NY interview. This time select that all wages are NY sourced. You can then allocate which is resident and which is non-resident to complete the NY state interview.

Next you can complete the MD interview. You will subtract out the NY resident income from MD income when asked to allocate so that is not double taxed. When you get to the credit section use the NY non-resident income and tax on that income to claim the credit for taxes paid to another state.

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