Moving is something that is always a challenge. Taking on a completely new location and trying to settle in whether you are alone or with your family, is no small task. Moving to a different state is an even bigger challenge than shorter moves. When you move to a different state, there are several things that you have to take care of. You will have to register your vehicle in a new place, get a new driver’s license, register to vote and so on. Mark Dicus & Company is here to talk about what moving to a different state means for your taxes.
Tax Implications of Moving to Another State
When you move to another state, you need to take filing taxes into consideration. This means that you will need to file three different tax returns that you will need to keep track of and file appropriately. You will only have to file one federal tax return, but you will also have to file a tax return in both the states that you have lived in that year. Before you start to feel panicked, it’s important to remember that it doesn’t mean you will have to pay double the taxes. Read on to get the specifics of how to file in multiple states.
Part-Year State Tax Return
Like mentioned above, you don’t have to worry about paying taxes twice. When you file in two different states, you only pay taxes on the income that you earned while you lived in that state. Some people have income that comes from interest or dividends that got paid. If this is the case, you will divide that number into the time that you spent in both places. Some people know exactly how much money they have earned in each state and can report it accordingly.
Paying Income Tax in Multiple States
There are a handful of states that will require that you claim all the income you made in a calendar year regardless of which state you lived in. This may leave you feeling like you are paying taxes on your income twice. Before you get too upset, it is important to note that you can claim a tax credit that will offset the extra income that you had to report to both of the states.
Tax Preparation, Filing & More in Summerlin, North LV, Henderson, Lone Mountain Village & Greater Las Vegas, Nevada
With all of the complexities that come with moving, especially when you are talking about moving long distances, you don’t want to have to deal with the tax implications on your own. There is a lot to juggle when it comes to relocating. That’s why we recommend leaving your taxes up to the experts at Mark Dicus & Company to ensure your taxes are filed as they should be. Our team will be able to answer any of the questions you may have about how your taxes will change. Call us today!