On Residency and Which State show earnings

[asilow]

My permanent address is D.C.  where i am a graduate student in 2021.  But I worked remotely in New Mexico for 3 months for a NY employer who required remote work due to COVID and deducted NY state income taxes on my w-2.  I understand I file a NY state tax return as a non-resident showing all my income earned there.

But what about NM?  Am I filing as a non-resident or part time resident in NM?  Do i show i earned no income there as it was earned and claimed in NY w-2 by my employer or alternatively am I having to claim it also in NM and thereby being double taxed on it?

What about D.C.?  Do i  file as a part time resident or permanent resident?  I assume i show no income earned in D.C.

[ErnieS0]

If you are a permanent resident of DC or a statutory resident then you will have to file a DC resident return.

DC defines a statutory resident as "any individual who maintains a place of abode within the District for an aggregate of 183 days or more during the taxable year, whether or not such individual is domiciled in the District."

If you are a full-year DC resident, you would be a nonresident of NY and New Mexico.

You would report to NM the amount of wages earned while working in NM.

New Mexico imposes a tax on the net income of every resident and on the net income of every nonresident employed or engaged in business in, into or from this state or deriving any income from any property or employment within this state.

Personal Income Tax Information Overview

[asilow]

Thank you but need a clarification on what it means for income to be 'earned'.   I wanted to be in NY with NY employer but due to COVID they required I work remotely and I chose NM.  But if I report the same income on a NM state income tax return earned remotely in NM with NY employer claiming it for NY state income taxes then won't I be double taxed on the same amount?

[DMarkM1]

Yes, in actuality triple-taxed as DC is taxing on all income from all sources as your resident state!  However, you will claim a credit for taxes paid to another state on your resident DC return for the income taxed by NY and NM to mitigate the multiple taxations. You will take note of income taxed and the income taxes imposed by both non-resident states and those figures will be used for the DC resident return to claim the credit(s).