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Married living in 2 different states

Not sure how to handle filing. Husband and I are married but he moved to Arizona in Q2 2024. He does not have Arizona source income though. I live in VA full-time. Is it best for us to file MFJ federal but then individually in AZ (he as a resident and me as a nonresident) then individually as well for VA (he as a nonresident and me as a resident)? Or should we file Married Separate federally as well?

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3 Replies
ThomasM125
Employee Tax Expert

Married living in 2 different states

Normally, you will pay less tax on your federal return if you file married-joint but you would have to do it both ways to see which is best. 

 

Arizona is a community property state, so if you filed a separate return your spouse would get taxed on half of your income for the most part. You would have to account for community property income and deductions. However, if you filed jointly your income would be higher. At the same time, you would get credit on your Virginia return for taxes paid to Arizona.

 

Since you are the only one that has income, it may be better to file married-joint in Virginia, as you will get more deductions that way.

 

So, it will probably be best to file joint on your federal and Virginia returns. For Arizona, you will have to do it both ways to see which is best, unless you don't want to fool with the community property income allocations. 

 

Also, to file separate on the state returns, you have to complete a separate federal return that you don't file, but it is the only way to prepare a separate state return.

 

 

 

 

 

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Married living in 2 different states

Thanks for your reply. I realize I missed providing some key info. My husband is actually the primary wage earner (probably 4x more than me). He moved from VA to AZ in April 2024 so while he doesn't have AZ source income, he now has federal pension $. I'm thinking it makes more sense to file individually at the federal and state levels but, as you suggested, may need to run both scenarios.  

TomD8
Level 15

Married living in 2 different states

"He moved from VA to AZ in April 2024 so while he doesn't have AZ source income, he now has federal pension $."

 

Once he became a resident of AZ, all of his income became taxable by AZ, regardless of the income's source.

 

"...then individually as well for VA (he as a nonresident)..."

 

Not correct.  Since he changed his state of residence in April, for 2024 he is a part-year resident of both VA and AZ.

How do I file a part-year state return?

**Answers are correct to the best of my ability but do not constitute tax or legal advice.
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