Paying NC Income tax as non (or part-time?) Resident

[mische7]

Hmm. I could use a little hand-holding here. I'm extremely confused...
 - I am a resident of WA state.. My car tabs, voting, library card and address are all there.

- That said, I work for a business out of Charlotte NC.

- I also have family in NC so I've been spending chunks of time in NC. (about 6 months this past year, in total)

So, question #1 is: Am I considered a non-resident or a part-time resident? I'm not sure what officially constitutes 'resident' status.

Question #2 is: when I file NC income tax, do I leave the total amount as-is (in the box where I select NC source - non or pt resident) and let TurboTax work it out? Or do I actually tell it that, for example, 20k was made while I was in NC and 20k was while I was in WA?

I've done this for several years now and I feel like I'm confused every year and do it differently every year. I'd love to get this right!

[DianeW777 · Accepted solution]

You are considered a nonresident.  North Carolina (NC) defines  a "part-year resident" as an individual who moves his or her domicile (legal residence) into or out of North Carolina during the tax year. Based on your statements you did not do that and would be considered a nonresident. 

• Prepare your nonresident state return first, then prepare your resident state so that TurboTax knows how to calculate your credit for taxes paid to another state (for your resident state).

North Carolina Filing Requirement: Nonresident of North Carolina during tax year 2021 and you received income while a nonresident of North Carolina was:

1. attributable to the ownership of any interest in real or tangible personal property in North Carolina, 
2. derived from a business, trade, profession, or occupation carried on in North Carolina, or 
3. derived from gambling activities in North Carolina, and your total gross income for 2021 exceeds the amount shown in the Filing Requirements Chart for your filing status, you must file a 2021 North Carolina individual income tax return, Form D-400.  
   • You were a part-year resident of North Carolina if you moved to North Carolina and became a resident of North Carolina during the tax year, or you moved out of North Carolina and became a resident of another state during the tax year

You will enter the amount of wages you earned while you were inside of NC doing the work.  Any income earned while you were not in NC should not be taxed on the NC return. You can do this on the W-2 entry screen if your income is from wages. Then review the questions in the NC return to be sure the right income is taxed.

For Washington (WA) you can receive a credit for taxes paid to another state on the same income. The credit for tax paid to another state on the same income will be the lesser of:

1. the tax liability actually charged by the nonresident state, OR
2. the tax liability that would have been charged by your resident state