My nephew worked and lived in NC as an assistant coach in Nov and Dec of 2020. Quit and came back home to PA. His W2 shows that the state taxes went to NC. Can I still consider him a resident of PA?
there are two concepts - residence and domicile. a taxpayer's state of residence can be the same as their state of domicile. but some taxpayers move from state to state during the year and are considered residents of each state - ballplayers, for example, have to file tax returns in every state they play in that has an income tax even though they are residents for only a few days a year. domicile is what a taxpayer treats as their permanent place of abode.
your nephew needs to file a part-year resident return for NC. if using TurboTax this must be prepared first. then he needs to prepare a resident state return for PA where all his income will be reported. he will get full or partial credit for the state income tax liability in NC
I'm going to disagree with the part-year NC csuggestion......He was only in NC a short time, did not remain in NC, and certainly was not there over 6 mos....when he might have been forced into doing a part-year resident tax return for NC.
File non-resident for NC and full yearresident for PA. After completely filling out the Federal tax return, make sure the NC non-resident tax return is worked on first.....And then the PA full year resident tax return....and take a credit for taxes paid to NC on the PA tax return.
Do not indicate he moved to-or-from PA during the year, but indicate NC as an "Other" state he worked in during 2020.
But that's my opinion as another software user.