If I change jobs and get paid relocation wages (lump sum “bonus”) for a move from MA to WA, will MA tax those wages if paid 1/31 and move 2/1.

[kmeline]

If so, Would I avoid MA tax liability by moving before the pay date?

[TomD8]

If your bonus is derived from work you performed in Massachusetts, then YES, it is taxable by MA.  Here is MA's law:

Massachusetts source income includes items of gross income derived from or effectively connected with any trade or business, including any employment, carried on by the taxpayer in Massachusetts, whether or not the non-resident is actively engaged in a trade or business or employment in Massachusetts in the year in which the income is received.

https://www.sec.state.ma.us/reg_pub/pdf/800/830062.pdf

MA-source income is taxable by MA, regardless of whether or not you are a resident of MA when you receive it.

[Opus 17]

@TomD8 , 

I think it is the new Washington state employer that is paying the relocation bonus.

@kmeline 

If it is the new employer that is paying the bonus, then I believe it will be taxable in Massachusetts if you receive it while you are still considered a resident of Massachusetts even though it is connected to work you will be doing in Washington.  As such, if you can delay payment until after you move, that would make it no longer considered Mass income.

Be aware that the date you change your permanent residence (domicile) does not necessarily have to be the day you physically moved.  It depends on all facts and circumstances.  For example, a few years ago I relocated from New York to Virginia for a new job.  I bought my VA home on June 15, I sold my NY home on June 25, I moved all my goods out of my NY home on June 24, moved my goods into my VA home on June 27, my last day of paid work in NY was June 30, my first paid day in VA was July 1, but from July 1-July 5 I was in New York, staying with relatives, to supervise the moving of some scientific equipment that was moving with me.  I re-registered my car in VA, got a new drivers license, and registered to vote, all during the month of July.  When did I officially change my residence from NY to VA?  I think a fair argument could be made for some time between June 24 and June 27.  Fortunately I was not audited by either state so I did not have to test the principal.  

If the date you change your domicile is definitely going to be Feb 1, you might ask if the new employer can delay payment of the bonus until the February pay cycle.  But there may be some flexibility in determining the date you "change your domicile."

[TomD8]

@kmeline --

@Opus 17 is correct.  My previous answer only holds if the bonus is derived from your MA employment.

If the bonus is received from your WA employer, and you receive it after becoming a resident of WA, then it is not taxable by MA.  In general, you become a resident of a new state for tax purposes on the day you begin living there with the intent (as demonstrated by your actions) of making it your new main, permanent home.

Section D of this reference describes how MA treats part-year residents for tax purposes:

https://www.mass.gov/technical-information-release/tir-95-7-change-in-the-definition-of-resident-for...

WA has no state income tax.