Hi,

I am a Chinese citizen, holding a H-1B work visa with a company incorporated in New Jersey. Our company is an IT consulting company, I am sent to different states to perform the service, usually on a short term basis. I was assigned to work on a project for a big company in Charlotte, NC starting from 04/2004 to 12/2004. During that time, I rented an apartment in Charlotte, NC, also bought an used car and had a NC drivers license.

Since the nature of our company's business requires its consultants like me to travel to client's site in different states to perform the service on a short term basis, my company always deduct New Jersey state tax for me, and I always claim New Jersey as my state of residency, and always filed NJ state income tax.

Now the problem is that North Carolina Department of Revenue is asking me to file income tax for the year 2004. They even filed a tax lien against me in the court.

My question is, should I really file the NC state income tax? Considering my assignment in NC is short term, and I never have any intention to be a resident of NC. What should I do?



Thanks,

H1-B Tax Payer

You may need a carolina tax advisor. It appears your nexus is in nj.however you do business on NC,wherein you may subject to taxation on your income earned in nc.

If you work in any state and have an income, then you must file tax return.
You must file NC tax return. Then on the NJ tax return where you reported your full year income, you should have claimed credit for the taxes paid to NC.

Now you must file NC state return for 2004 and pay the taxes.
You then file amended tax return for NJ, but may be it is too late. Normally any refund claim must be filed within 3 years of regular due date. For NJ, check at the NJ web site.

Thank a lot for your advice. Looks like that I will have to file the 2004 NC income tax and hopefully to remove the lien from court.

I checked the NJ tax website, indeed, I can not amend my 2004 tax return anymore, as it has been more than 3 years since I filed the NJ 2004 tax return in April, 2005.

Now I will have to pay state tax twice, and realize that why we need lawyers.

No you don't need lawyers; you needed professional advice.