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Hornman
Returning Member

What is considered taxable income in NC

I moved to NC from TX. Having never paid state income tax I would like to understand just what is considered taxable income in NC when most of my income sources are in TX. The words "income from NC sources" as used in the NC tax documentation is confusing to me because my employer (remote), financial planner, bank, pension, and petroleum royalties are all in TX  (I also have two accounts with nation-wide firms). Therefore my NC taxable income could be substantially less than my federal taxable income.

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3 Replies
Hal_Al
Level 15

What is considered taxable income in NC

The concept of "income from NC sources" does not apply to residents.

 

 All income received while a resident is taxable by the resident state, regardless of the source. Since you are now a resident of NC, all your income received since the move date  is taxable by NC. 

 

What is considered taxable income in NC

@Hornman - NC taxes are quite simple -

 

for a full year resident,  it starts with your Adjusted Gross Income on Line 11 of the Federal Tax form.  That number less $12,500 for the standard state deduction (filing single) times 4.75% is the tax due.  

 

All your pension income, royalties,etc. are taxed in North Carolina as your are a NC resident.   

 

Where your employer is does not matter.  Where you physically work and live matters.  

 

it is rather simple,

 

if you moved to NC during the year, you are a part-year resident and the TX income would be excluded.  

 

Turbo will walk you through this quite simply. 

What is considered taxable income in NC

You do not mention when you moved.   If it was during the tax year, you will need to prepare and file a part-year return for the state you lived in after you left TX.

 

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

 

https://ttlc.intuit.com/questions/1901560-how-do-i-file-if-i-moved-to-a-different-state-last-year

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**
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