Ask Experts Questions for FREE Help !
Ask
    nativetexan's Avatar
    nativetexan Posts: 4, Reputation: 1
    New Member
     
    #1

    Jun 1, 2011, 08:38 AM
    Texas & Georgia -Tax questions
    My husband and I live in Texas. I'm a native Texan, having lived here for over 35 years and he has lived in Texas for 18+ years. He was active duty military for quite a while, and is now an Air Force Reservist stationed at a Texas AFB. We have NEVER lived in a state that has state income taxes. Recently, he accepted a civilian job offer in Georgia. I was not happy when I learned about the state income taxes there. I read something about if work is done outside of Georgia, then you don't have to pay taxes on that income. He is a pilot. Some of his work would be in Georgia, because the jet flies out of the Atlanta area, but MOST of it would NOT be because he flies all over the country as well as out of the country for much of the time. Also, he does his Military Reserve duty here in Texas, for 1 week per month, every month. We will probably end up "moving" to Atlanta, but I do not want to give up our TX residency nor pay GA taxes if possible. We own our home here in TX. What if we kept it and just rented a place in GA? What if we lived in TX for part of the year and GA for part of the year? What are our options? Help!
    ebaines's Avatar
    ebaines Posts: 12,132, Reputation: 1307
    Expert
     
    #2

    Jun 1, 2011, 09:00 AM

    He has to pay GA income tax on income earned while working in GA. Since he is based in GA, that is deemed to be his work location, even though he flies to other states. By your logic he would have to allocate his income to each sate he flies to, which would be an accounting nightmare and would be at odds with what his employer would report on his W2 (FYI - many states require such an allocation for earnings of professional athletes made while playing in their state, and a few do also for entertainers, but to my knowledge this is not true for airline pilots). I'm afraid your stuck on this.

    If he doesn't want to give up his TX residency then he will have to commute from TX to his job in GA each day (which certainly seems impractical), but even then he would still have to pay GA income tax on his wages. All that this would accomplish is shield other income from GA taxes - such as any dividend or interest income he may have.
    nativetexan's Avatar
    nativetexan Posts: 4, Reputation: 1
    New Member
     
    #3

    Jun 1, 2011, 09:36 AM
    What about the fact that he is still in the Air Force Reserves and serves actively for about 7-10 days every month here in Texas? Does that not protect him in any way? Also, he is not an airline pilot, he is a private pilot, if that makes any difference. Can you explain about the professional athletes and entertainers a little more please? I'm not quite sure I understand what you mean, but I would like to know if and how they get around that sort of thing. Thanks!
    ebaines's Avatar
    ebaines Posts: 12,132, Reputation: 1307
    Expert
     
    #4

    Jun 1, 2011, 09:54 AM

    Regarding athletes and entertainers - many states require that professional athletes pay income tax on earnings that are due to performing in that state. So for example when the Cowboys play the NY Giants (in NJ) Tony Romo has to pay the state of NJ income tax on his earnings for that game, even though he is a Texas resident. Similarly he has to pay PA income tax and Phildaelphia city tax when he plays the Eagles in Philly. You can see that for professional athletes who play a lot of away games this is a real headache - it's not uncommon for major league baseball players to have to file income taxes with 15 or 20 different states. This all started with the state of CA (of course) who wanted a way to get a piece of Michael Jordan's income when the Bulls played the Lakers. Over the past 20 years the practice has spread to about 20 states. Be glad that this only applies to professional athletes and entertainers and not pilots.

    As for your husband being in the reserves - unless he can show that he is physically present in TX more days during the year than he is physically present in GA, his tax home will be GA.
    joypulv's Avatar
    joypulv Posts: 21,593, Reputation: 2941
    current pert
     
    #5

    Jun 1, 2011, 11:40 AM
    Texas, like Nevada, is unique. One supports itself on oil taxes, the other gambling taxes. You just have to decide what is worth it to you, since there is no way around paying the GA state income tax. Unless you could get them to move the base of operations to FL, which also doesn't have one.
    nativetexan's Avatar
    nativetexan Posts: 4, Reputation: 1
    New Member
     
    #6

    Jun 1, 2011, 12:32 PM
    Well, for this year, he will have lived in Texas for the majority of the year. So, how do the taxes work in that case? I plan on living here in TX for a while until we decide if we want to move out to Atlanta. What about my income? Can GA get their hands on any of MY money, investments, etc. while I live and work in Texas but am married to someone who lives and works in both Texas and Georgia? What about his Air Force Reserve pay, which he earns here in Texas? Can GA get their greedy hands on any of that too?
    ebaines's Avatar
    ebaines Posts: 12,132, Reputation: 1307
    Expert
     
    #7

    Jun 1, 2011, 01:47 PM

    For 2011 you will be considered a part-year resident of GA, and pay taxes to GA only on income earned while working or living in GA. Income from non-GA sources earned prior to moving to GA are not taxed by GA. The only complication here is that if you stay in TX while your husband is living in GA you may want to file separately to avoid having to report your TX income to GA for that time. As for his military pay - as a GA resident he would owe GA income tax on ALL his income, regardless of whether he earned it in GA or not.
    joypulv's Avatar
    joypulv Posts: 21,593, Reputation: 2941
    current pert
     
    #8

    Jun 1, 2011, 02:38 PM
    Greed? How do you suggest that they pay for state services?
    Look at the big picture too.
    If he took this new job, I'd imagine a bigger chunk of change was included?
    Plus, Texas ranks 3rd highest property taxes, Georgia 33.
    And so on.
    nativetexan's Avatar
    nativetexan Posts: 4, Reputation: 1
    New Member
     
    #9

    Jun 2, 2011, 09:35 AM
    ebaines,You mean He not ME may be considered a part year resident of GA right? Or did you mean nonresident? I'm not in GA & don't think I ever want to be now. He is a TX res, not GA res & we'd like to keep it that way if we can. He has a TX address,TX drivers license,TX registered vehicles,TX voter registration,TX home of record as far as military is concerned, does his AF Reserves duty in TX, we pay our TX property taxes on our TX home, Texas is where he always comes back home to. He has not even moved to GA. He is staying in a hotel there & will do so on & off until we figure this out. Because he's a pilot, he checks in & out of hotels frequently, goes on overnight trips etc.He is definitely not even staying nor living in GA during that time either. As for how much time he actually spends in GA it's not very much because of the nature of his job. He flies all over the USA & the world and he sometimes even flies to & stays overnight in good ol' Texas. He spends more time in TX than anywhere else in the world.
    ebaines's Avatar
    ebaines Posts: 12,132, Reputation: 1307
    Expert
     
    #10

    Jun 2, 2011, 10:06 AM
    Quote Originally Posted by nativetexan View Post
    ebaines,You mean He not ME may be considered a part year resident of GA right? Or did you mean nonresident?
    It's confusing as to who would be moving and when. You have stated that he might move, then you might move later. What I meant was if he moves to GA in the middle of 2011, then for 2011 he is a part-year resident of TX and a part-year resident of GA. For example - if he relocates on July 15 then he is a TX resident from Jan 1 - July 14 and a GA resident from July 15 - December 31, 2011. The concept here is that you can be a resident of only one state at a time, so for those people who relocate from one state to another mid-year they are considered to be part-year residents of both states for that year.

    Quote Originally Posted by nativetexan View Post
    He spends more time in TX than anywhere else in the world.
    You talked earlier about moving to GA, hence my response about being a part-year resident of GA for 2011. But if he's actually in TX more nights than GA even after he starts his job then he has not moved to GA and can claim TX as his tax home. He better make sure that his employer has his residence recorded with a TX addess. Under this scenario he would be a GA non-resident wage earner, would file a non-resident income tax return with GA, and would pay GA income tax on his GA-based wages. He should maintain records of where he spends his time so that if GA tries to claim him as a resident he can prove that he is truly a TX resident. As I stated earlier - even though he flies all over the country his job is based in GA, and hence he will pay GA income tax on his wages.
    joypulv's Avatar
    joypulv Posts: 21,593, Reputation: 2941
    current pert
     
    #11

    Jun 2, 2011, 10:08 AM
    The only way he can keep TX as his tax home, pay GA tax on only his GA income, and deduct travel/hotel expenses, is if his job in GA is for one year or less (defined by the IRS as temporary). Otherwise his tax home is GA whether you maintain your home in TX or not. The majority of his income is from GA.
    Tax home, travel, and employment in other states is quite a long area to read up on at IRS.gov.

Not your question? Ask your question View similar questions

 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Questions about being sued in Texas by a credit card company [ 1 Answers ]

What is the first step I should take? Pull a credit report? I would like to do this without a lawyer, any pointers of what to do or what to expect in court is appreciated. How should I answer the following questions which are stated in the papers I was served? The total is $3,320.35 plus pre and...

Questions from Texas [ 7 Answers ]

I live in Texas and have credit card collector hounding me. Due to personal situation I wasn't able to make my minimum payment (paid what I could) for several months. Now it seems I owe as much on interest, late charges, etc. as I did the original amount about $15,000. Can't borrow, no...

Help with Income Tax in Georgia [ 1 Answers ]

Hi, I am moving to Atlanta, Georgia from India for 1 year in April 2010. I would need help with how I need to manage my Income Tax there. My income would be $65000 How is the Income Tax calculated? How can I save on Taxes? Is my income in India going to be taxed? I bought a house in...

Fired for no reason in Texas questions [ 2 Answers ]

I recently worked at a restaurant in tx. I had a table of 30 people come in the company policy is to add gratuity of 15% to all tables over 8. I follewed policy which is to stamp and highlight on all tickets that great had been added I did this and the people tipped over the great. Well a couple...


View more questions Search