Message Font: Serif | Sans-Serif
No. of Recommendations: 0
Just to add a bit to what Phil says, I can give two examples. Suppose you live in New Hampshire and work in Massachusetts. This is common. You fill out a Massachusetts nonresident/part year resident return. But NH has no state income tax -- yet -- so you pay taxes in NH only on your investment income. (As I recall.)

Suppose you live in New Jersey and work in New York City. Then you fill out a New York nonresident/part year resident form, which includes the extra-special NYC tax, and a New Jersey resident tax form. You get a credit in NJ against taxes paid in NY, but you never pay less in the way of total taxes than you would if your income were earned all in one state or the other.

It's a pain to fill out the multiple state forms (my case happens to have been neither of these two examples), but it's doable. You just have to spare a couple of extra hours and maybe make copies of your W-2's.
Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.