How are interstate taxes in the USA?

[Melanie31]

For example, a person who lives in California and works in Nevada pays taxes to which state?

[Iron_Man]

I’ve never been in that situation. I’ve just worked in Miami and then I helped out at the family campground when I was a teenager in North Carolina.

[Iron_Man]

Thank you for the award Melanie 31

[Jerre]

I’m not really sure.

[Jerre]

@Melanie31 Thank you for the Like

[Jerre]

@Melanie31 Thank you for the MHO

[Anonymous]

I have seen this situation many times.

That depends a bit on the relationship between the states.

In general everything you buy and do in the case of work you owe taxes to the state in which the transaction and work took place.

Sales Taxes:
This is simply the point of sale. Althou for internet transaction many states will charge taxes if the provider has a physical location in the State.

Property taxes:
This is also simple in most cases however in a few places due to geographic error where one part of a property is in one state and anther is in anther. You may end up owing Taxes to each state for their respective parts separately.

Income Taxes:
In general every minute of work you owe taxes to the state in which the work was actually conducted.

That said in each of these cases the States in question if they have a good relationships can alter this with agreements like a Reciprocal Tax agreement:
https://www.thebalancemoney.com/state-with-reciprocal-agreements-3193329

But only between select states.

So for example Illinois will let you work and live in Iowa, Kentucky, Michigan , and Wisconsin, but not Missouri, Indiana, or Tennessee.

If you happen to live in one of those states and work in Illinois you and your employer have to track the number of hours you work in each state.

[Kelley1]

It depends on what state he shows as his address on his feceral income tax. His employer in Nevada is going to report his Nevada income to the state of Nevada. However, Nevada has no state income tax. If he list California, as his residence on his federal income tax, the IRS is going to report to the state of California that he use a California. In that case, California is going to require he pay California income tax. What he should do is show is show his Nevada employer's address on his federal taxes. Should he receive any mail, his employer will give it to him. That way the IRS will not report his Nevada income to the state of California and he can avoid paying the California state income tax.

If he is married and his wife is employed in California, it gets more complicated.

[Jersey2]

I have lived in two states and worked and lived in another all at once. My residency was in State 1. I had a second home in State 2. I worked and had an apartment in State 3 for a partial year. In state 3, I paid state tax for the work that I was compensated for there which was for a partial year but did not include other sources of income during that time as that hit State 1 since I didn’t earn it in State 3. That State 3 income was deducted from my income for the state tax in State 1 where my permanent residence was and there I was taxed on the rest of my income. I was not double taxed. And State 2 was never an issue for state taxable income since I didn’t earn my money there and I was not a primary/permanent residence and I just paid property tax there.

I usually do my own taxes but this once I wanted outside help so a paid a company but it was as I had thought. TurboTax will help you as well.

[DrPepper12]

WOW!!!

[KostasKouvalis]

That's a good question. I don't know honestly. I live in California, but was technically registered as a vendor in Nevada, 'cuz I wrote an article for a travel magazine and got paid $150. As far as I know, I wasn't charged any taxes by Nevada. But I know if it's another country you have to pay taxes to both. Many actors have gotten in trouble for this. Australia was chasing Paul Hogan for tax evasion, even though he hadn't worked and resided in Australia for years

[ohsheeT]

Well I live in Nevada. So I have to pay property tax my home tax

And if I work in California my taxes would be taken out of my check through California state because that's where the business is

[exitseven]

It depends on the state. Some states make you pay in both states. I bet California is like that.

[dudeinohio]

Typically. Taxes are taken out where you work. If there is a difference in tax rates, then you pay the difference, unless it's lower.

[DrPepper12]

There can be state AND city taxes here. NYC for one...

[Enginn]

Where you live probably. It wouldn't make sense otherwise

[Dargil]

State income tax varies by state laws.

[animesenpai]

Dependsnon the state but it could be both

[kellytheman]

You pay taxes where you live.

[RedInnocent69]

Oooh! Good question.