Taxes in 2 states

[Djackson3]

I am an Alabama resident starting a new job in Mississippi. When I signed my tax w-2 I had to fill out 1 for both states. Does this mean I’ll pay taxes in both states while working in Mississippi? 

[xmasbaby0]

You did not fill out a W-2.  You filled out a W-4 for your employer.   In January you will receive a W-2 from the employer to enter on your tax return.    

When you prepare your state tax returns, you will need to prepare a part-year NON-resident return for the state you work in----Mississippi.    You will do that one first.  Then you will do a resident state return for the state you live in--Alabama.

https://ttlc.intuit.com/questions/2895920-why-would-i-have-to-file-a-nonresident-state-return

https://ttlc.intuit.com/questions/1901227-how-do-i-file-a-part-year-state-return

https://ttlc.intuit.com/questions/2895983-how-do-i-allocate-split-income-for-a-part-year-state-retur...

[rjs · Accepted solution]

You have to pay Mississippi tax on the income you earn in Mississippi. Since you live in Alabama, all of your income is subject Alabama tax, no matter where the income is from. But you will get a credit on your Alabama tax return for part or all of the tax that you pay to Mississippi. You will have to file two state tax returns, a Mississippi nonresident tax return and an Alabama resident tax return. Prepare your Mississippi nonresident tax return first, then your Alabama resident tax return, to make sure that the credit is calculated correctly.