I have a Tax question?

Question

I was having a discussion with somebody about state taxes and I was trying to figure out how they are calculated. Let's say, hypothetically, I lived in California for most of the year and make about $30,000. Then I there are some life changes and in October I move to Florida and my income is cut in half.

So I live in FL for 3 months and make half of what I made in . I know all state taxes are different. Would FL just take a percentage of that 3 months? Or would they want a percentage for my full year's income. How does it work?

Answer 1

There are no income taxes in Florida.  It is in our state constitution.  You would only pay California for the time you spent there and the amount you earned there.

Answer 2

In each state you file as a part year resident, and would pay only on the income that comes from that state or was earned while you lived there.

Some states, like FL, don't have a state income tax, so then you'd just file in the one state but only include the income from that state or while you lived there.

Answer 3

State taxes are only due in the state where the income was earned.  In your scenario you would have to file a federal income tax return, a California income tax return, and a Florida income tax return.  The feds get a piece of everything you make.  California only taxes the money you earned in California, and Florida only taxes money you earned in Florida.  

Answer 4

Each of the states have a slightly different way of dealing with a part year residence.  So I will give a general answer that may differ slightly depending on the two states involved. Each state would require a part year tax return and tax you on the income that you earned in their state.  For example you would get 2/3 of the credits in one state and 1/3 in the second for any deductions, exemptions or credits if you lived in one for 9 months and the other 3 months.  The income would be represented by the amount earned in each state. All of that would get altered by the fact that Florida does not have state income tax if that were one of the states.

Answer 5

If you move from one state to another state, you are a part-year resident of both states.  Each state's rules are separate, but in general you would be taxed in each state only on the income you earned in that state, plus a pro-rated amount of unearned income (as from investments) depending on the amount of time you lived in each state.

Answer 6

If there were state income tax in FL, you would file a part year resident tax return in both CA and FL.  You would get a credit for taxes paid to other states.

Answer 7

You would fill out the state's part time resident form. Each state has its own formula for computing how much is attributable to the state. If you don't officially change residency, you fill out the non-resident state form. Sometimes they are the same, depending on the state.

Pro athletes have to fill house dozens of state forms

In the example you gave, you will fill out the California state form for Jan to Oct paying tax on California-earned income, and Florida happens to be one of the seven or so states that doesn't have an income tax; you get lucky; but if it did you would fill out Florida from October to December, paying tax on Florida-earned income.

Answer 8

If you moved to a state (with income tax), you must report income earned while you were in that state.

On CA tax return, you may even have to report income earned while in CA as well while in other state. It depends upon your residency status.

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