Do I have to file tax returns in more than one state?

by TurboTax•880• Updated 3 months ago

These are the most common situations for needing to file multiple state returns. Select yours below to learn more.

You moved to a different state during the tax year

If you were a resident of two different states during the tax year, follow these steps. This doesn't include temporary moves for short-term work or school if you intend to return to your home state.

You worked in a state that you're not a resident of

Income gets reported to the state it's earned in. Generally, this means out-of-state workers have to file a return for their work state in addition to their resident state (excluding reciprocal agreements and non-income tax states). Examples include:

Out-of-state students who earn income in the state where they attend school
Employees who regularly commute across state lines, like New Jersey residents who work in New York
Employees who perform work in other states on assignment

Typically, you'll file a nonresident state return for the state you worked in and pay that state's tax. You'll then get a credit for taxes paid on your resident state return.

You own property or have business interests in another state

If your out-of-state business or rental property generates income, you'll need to file a nonresident return in that state.

But even if it doesn't, the state may require you to file a return anyway, or you might file to take advantage of state-specific credits, such as property tax credits. Check with the state Department of Revenue for state-specific info.

Here are some common situations where you don't have to file a second state return:

Interest from an out-of-state bank or account
Out-of-state employer
If you earned money in one of nine states that don't collect income tax, but live in a state that does, you need to report the income on your resident state return.
Your resident and work states have a reciprocal agreement.