State of Domicile vs temporary move

[edgar561]

Hi all,

I have been a New Jersey resident since 2009. I moved to Pennsylvania under a temporary arrangement in August 2020, always intending to move back to NJ when the Covid crisis eases, but I didn't renew my lease in NJ (i.e. I don't have a residence / place of abode in NJ now). I got a PA driver's license under my temporary address as required by PA law. I will move to a new address in NJ once I move back, hopefully in 2021.

I would like to determine whether my tax domicile remained in NJ all the way, or if I'll need to file part-year PA resident returns for 2020 and 2021.

I don't have an agenda here (either way is fine, little difference in tax bottom line), just want to do it correctly. However, I need to know soon so I can pay estimated taxes for Q4 2020 to the correct state.

Any help is much appreciated!

[fanfare]

Since your intent is to return, your domicile is NJ.

If you move to a new location but intend to stay there only for a limited amount of time (no matter how long), your domicile does not change.

[Opus 17]

It sounds like your domicile is still NJ.  Your lease and drivers license are only some of the factors.  Other factors include social clubs, the location of your doctor and dentist, church, and your intentions.  Another way to think of it is that your domicile is where you have the most loyalty.

You will, of course, need to file a PA non-resident return for income earned while you lived in PA.  You will also file an NJ return to report all your world-wide income including your PA income.  You will get a credit on your NJ return for taxes you paid in PA. 

[Anonymous]

I have been a New Jersey resident since 2009. I moved to Pennsylvania under a temporary arrangement in August 2020, always intending to move back to NJ when the Covid crisis eases, but I didn't renew my lease in NJ (

domicile
n. the place where a person has his/her permanent principal home to which he/she returns or intends to return.

because you have no home to return to in PA, I would say your domicile is NJ.

other factors.   did you vote in 2020 - what state?

what state do you maintain bank a/c's

[TomD8]

NJ's rule concerning change of residency is this:  "Your move is generally considered a change of residency status (resident to nonresident or vice versa) if, at the time you moved, you intended to permanently leave one home and establish a new permanent home somewhere else."  

https://www.state.nj.us/treasury/taxation/pdf/pubs/tgi-ee/git6.pdf

Another wrinkle is that NJ and PA have tax reciprocity with regard to W-2 income.  This means that NJ residents are not subject to PA income tax on earned income.  See this web reference for the details:

https://www.state.nj.us/treasury/taxation/njit25.shtml

[edgar561]

Edit: First of all, thanks for all of your responses!

What does it mean to maintain a bank account in a given state? I have an account with a national bank that has branches in all 50 states. I opened it in NJ but reported the address change when it occurred. Does that make my bank account Pennsylvanian now?

FWIW I'm not registered to vote in any state (foreign citizen but US resident taxpayer).

[edgar561]

Thanks for this!

I've read about reciprocity, but to complicate things further, my W-2 income is from New York, with NY state income tax withholding. I have some dividend & capital gain income which is small relative to the W-2 income, but big enough that I should probably pay estimated taxes.