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    Chelsyd's Avatar
    Chelsyd Posts: 1, Reputation: 1
    New Member

    Nov 29, 2018, 01:38 PM
    Workign out of State
    I work for a company in another state. Do I file taxes in my home state or in the state the company is based out of?
    ebaines's Avatar
    ebaines Posts: 12,132, Reputation: 1307

    Nov 29, 2018, 02:46 PM
    You most likely have to file income tax returns in both states. You first prepare a tax return for the state you work in (i.e. the non-resident state), and you end up paying taxes in that state on the amount you earned in that state. Then you prepare a return for your resident state, calculate taxes owed on your total income, and then take a credit for the amount of taxes paid to the state you work in. In many cases if your out-of-state wages are the majority of your income you'll end up not owing your resident state very much. However, income tax rates vary widely from state to state, so it's impossible for us to predict without more detail. Something else to consider: some states have reciprocity agreements which allow you to file only one income tax return, in the state you live in, not where you work. We can check whether that applies to your situation, if you tell us what state you live in and what state you work in. Finally, check your pay stubs to see for which state your company has been withholding taxes - you want to be sure they're doing it correctly, because if they are withholding for the wrong state it can cause issues when you file your return(s).
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,778, Reputation: 846
    Senior Tax Expert

    Nov 29, 2018, 05:33 PM
    Everything ebaines says is accurate; I have nothing to add.

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