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    gousecris's Avatar
    gousecris Posts: 12, Reputation: 1
    New Member
     
    #1

    Sep 30, 2006, 07:14 PM
    Which state tax applies to me
    I am on H1B Visa. My employer a consulting services firm based in Texas.
    I am working for a client of my employer who is in Vireginia.
    My wife works and stays in West Virginia. I used to stay in Texas and visits my wife in westvirginia on week ends. Due to my services for the client company in virginia, I travel a lot through out USA on week days and lands back in West Virginia on week ends to staywith my wife. Due to travel I gave up my rented apartment in Texas and changed all my bank, creadit card addresses to my wife's address. I do not rent or own any property/apartment in any state now. Now which state tax applies to me.

    1. Is it Texas state tax as my employer who pays me based in Texas?
    OR
    2. Is it West virginia state tax as all my bank/credir addresses refers to my wife's address and I stays on weekends there?
    OR
    3. Virginia state tax as my employers client is based there in virginia?
    OR
    4. All of the above

    Please advice me appropriately so that I do not want to be in trouble with IRS.

    Best regards,
    Mohamed
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,823, Reputation: 846
    Senior Tax Expert
     
    #2

    Oct 1, 2006, 09:31 AM
    You have legally transferred your state of residency from Texas to West Virginia, so for sure you must file a West Virginia state income tax return. Whether you owe money to WV is another matter (see below).

    If you work and earn above a certain amount (usually $10,000) in ANY state, that state has the right to tax you on the income earned within their borders. Most states of residence (in your case WV) give you a credit for taxes paid to other states. Often, the credit completely offsets any state tax owed to the resident state.

    Temporary workers often avoid the taxes for the state they work in because the employer fails to follow the law and does not withhold the taxes. It's not a big problem as long as the state does not become aware of your work within their borders. When they DO find out, however, there can be some heavy financial consequences for BOTH the employer and the employee.

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