Estimated taxes when I moved this year

[ktll99]

Hello -

For the past year and a half I lived in one state (NJ) and worked in another (MD). I had NJ taxes taken out of my paycheck, and I have been sending checks with quarterly estimated taxes to MD to avoid an underpayment penalty when tax season rolls around.

I recently moved to MD during Quarter 2 of 2022, so now MD state taxes are taken out of my paycheck instead. Does this mean I don't need to send the estimated taxes for Quarters 3 and 4? The way I see it, the combination of my quarterly estimates for Q1 and Q2 plus my paycheck taxes from Q3 and Q4 should more than cover me when I file my 2022 taxes.

Thank you!

[erinm0717]

Hello @ktll99 ! Happy to assist!

 If you are have MD taxes withheld for Quarters 3 and 4, then most likely you will not need to pay estimated taxes on top of that.  Just make sure you filled out the state withholding form correctly.  You can add the amounts you will have withheld in Quarters 3 and 4 and compare this to the amount of estimates paid in the first 2 quarters. If they are about the same, then you know you are withholding enough.

I hope this helps and let us know if you need further clarification!

[SundayInSalem]

Probably. If you live and work in Maryland, then you no longer owe tax to New Jersey.

You will still have to file part-year MD and NJ tax returns for 2022 since you lived in both states. Your NJ income will be what you earned while a NJ resident. You can only claim a tax credit for your MD tax liability for that part of the year—in other words, your MD withholding cannot be applied against NJ return.

If you have sufficient MD tax withheld in Q3 and Q4—and paid enough MD tax to cover your Q1 and Q2 MD tax—then you don’t have to make estimated MD tax payments.