During 2019, moved from NC to SC where my fiancé lived and then got married. How to file state taxes?

[mrendino]

In the middle of 2019, I moved from NC to SC, where my fiancé lived and worked. Before the end of the year, we bought a house and got married. I continued working for the same company the whole time. So now, I'm working on our taxes and am starting to regret not paying someone to do it for us. :( It's prompting to do a South Carolina Nonresident Schedule for half the year for both of us, even though she lived here all year. How should we file? How do I fill in the Taxable interest income, dividend income and Capital gain fields? Do we do the SC-1040 or the Schedule NR? Anything else I should be aware of? Thanks!

[SteamTrain · Accepted solution]

I'm not an expert on SC, but I recall that SC does things somewhat strangely for anyone where both couples are part-year....but in this situation, NC and SC are similar. 

The SC1040 is always used...but the Schedule NR is attached to it and feeds some values into the main SC1040 form.  (Line 48 on the Schedule NR feeds into line 5 of the main SC1040)

__________________________

Essentially,

 SC wants you to use their NR forms.  Your SC spouse would report ALL his/her income for the year as SC income, and you would report only the income you earned while living in  SC.  So, since there is only one field in the SC Schedule NR breakdown...you add her yearly total to your SC part-year amount for that particular income field.

Your SC dividends, interest, capital gains (etc) is reported based on where you lived at the exact time the interest and dividends were issued....so you need detailed monthly account listings for those so that you can break down your year's total into NC amount (for the NC part-year tax return), and the SC amount for your self, and added to your spouse's full-year amount. 

Work wages for you?? Well, you said you worked the same job all year...BUT you didn't say whether you were physically working in SC or NC all year. a)  IF you were working in SC while living in NC and after moving to SC...then ALL of that W-2 wage will be listed as SC income.  IF you were physically working in NC all year, even after the move to SC, then only the wage earned after moving to SC is listed as SC income when you go thru the SC income allocations.

_____________________

Reference from the actual SC instructions

(This is worded as if you and spouse are switched, but it still applies to your MFJ SC tax return...just mentally switch the two person's)

"How should I file if I am a full-year South Carolina resident but my spouse is not?
If you file a joint federal return, you must file a joint SC1040 with Schedule NR. You will report all income for the entire year to South Carolina. Your spouse will only report income earned in this state. "

________________________

Ref:  Page 7 of:

https://dor.sc.gov/forms-site/Forms/IITPacket_2019.pdf

________________________________________________

Yes...messy, and sometimes a professional with personal service is required for a messy year.

[mrendino]

Thanks for sharing that. My taxes were taken from NC when I lived there and then when I first moved to SC, they were taken for both states because my office was in NC. I then officially switched to working from home so only SC was taken out.  It really sounds like this is going to be a nightmare to get right.