I asked a similar question earlier and have since found out some info, I had a 401K loan out while working in MI. I left the company in Oct 05 and became a full time resident of NC. My loan defaulted in Jan 06, so at that point it is considered a withdraw, so do I owe MI taxes (where I lived when the loan was taken out) or NC taxes which is where I was living when it defaulted (and became a withdraw)? The 1099-R sent to me has a taxpayer ID that starts with MI, so that leads me to believe I need to pay MI taxes, so I'm very confused.
Any help would be greatly appreciated, the MI treasury has not been able to provide me with any sort of guidance for this situation.

Thanks again

If no Michigan taxes were withheld, no MI tax return is required.

You will owe tax to NC because that is where you lived when the distribution was made.