Comments on: Which state am I a resident of? Where do I file my taxes?

Question: Which state am I a resident of? Where do I file my taxes?

Jimmie — Sun, 20 Jan 2008 16:49:03 -0800

I live in NH but still have a CT driver's license... due to a combination of supposed lack of need and laziness.

I currently live and work in New Hampshire, in which there is no state income tax. All the rent, cable, and electric bills are in my name. I've been living and working in New Hampshire for about 7 months now. However, I still have a Connecticut driver's license. I never got around to getting a NH driver's license because I don't own a car, and the CT license doesn't expire for another 3 or so year... so basically a combination of a seeming lack of need and laziness.

So, for the sake of filing my taxes this year, am I a resident of New Hampshire or CT? Do I file taxes for both? As punishment for having never switched from a CT to NH license, does this mean CT's going to try and tax my income?

By: bcwinters

bcwinters — Sun, 20 Jan 2008 16:55:21 -0800

You're considered a resident of New Hampshire for the period of the year that you were actually in residency. So you'll have to file CT taxes for your income during the about-5-months you were still in CT. Your license doesn't come into play at all.

By: Miko

Miko — Sun, 20 Jan 2008 17:00:18 -0800

The questions are related but separate.

NH Driver Licensing, in which the state residency requirement is mentioned. You're supposed to change your license within 60 days of your move. If you go change it now, it's likely there will be no penalty.

But your driver's licensing only correlates to tax status in that you have to be a resident in the state to get the state driver's license. No matter what you do with your license, you owe income tax to the state in which you're a resident, if that state has income tax.

You won't owe income tax in NH, there being none. You don't even have to file anything.

But if you earned income in Connecticut before moving, it's likely you were a Part Year Resident of Connecticut and you'll need to pay CT taxes on the portion of income you earned as a CT resident. There is a specific form for filing as a Part Year Resident.

Connecticut Residency Status says:

If you are a resident or part-year resident of Connecticut and your gross income exceeds $12,750 (single filer), you must file a Connecticut income tax return. If your gross income is less than that amount but you had Connecticut income tax withheld from your wages, you must also file a Connecticut income tax return.

By: desjardins

desjardins — Sun, 20 Jan 2008 17:22:16 -0800

I've been in this same situation (with different states - WI license and MT address). The license does not come into play at all. Where you physically resided, paid rent, etc. matters.

By: backupjesus

backupjesus — Sun, 20 Jan 2008 17:51:29 -0800

You won't owe income tax in NH, there being none.

New Hampshire has a variety of state income taxes. While they apply to relatively few people, the OP should check to make sure that none apply to him or her.

By: Miko

Miko — Sun, 20 Jan 2008 20:33:32 -0800

Those are gains taxes, not what most people mean by "income taxes" as in taxes on regular wages. It's probably worth a look, but unless the OP has received an inheritance or has significant interest income, there's nothing to file.

By: Jahaza

Jahaza — Mon, 21 Jan 2008 07:46:37 -0800

You just graduated from college right? I think your license could definitely play into your being a CT, especially if your parents have a house there that you've spent a lot of time at, if you have social ties to CT, signifigant belongings stored there or other ties.

By: Miko

Miko — Mon, 21 Jan 2008 08:05:22 -0800

Jahaza - no. It doesn't matter who you've visited, what your social ties are, or where your stuff is. Legal residency is a statement you make about where you live, and it has to fit within certain parameters, but driver's licensing and storage aren't among the parameters. Someone who becomes a resident of NH and plans to drive in NH is supposed to get a driver's license within 60 days, but the licensing is something that follows state residency - it doesn't determine residency.

The CT regs say that you'd have to maintain a place to live in CT (and I suspect your parents' house wouldn't be considered a place you maintain) and be there more than 183 days in the year in order to be considered a resident. If you lived in NH for 7 months in 2007, you are not a CT resident. But if you had any CT income, you'll owe the tax to CT on the portion of the income you earned in CT.

Here again is the requirement for filing as a part-year resident in CT:

Part-Year Residents

A part-year resident is anyone who changed his or her legal residence from or to Connecticut during the taxable year.

Part-year residents of Connecticut must complete:

* Form CT 1040NR/PY,
*
Worksheet CT-1040AW, and
*
Schedule CT-SI.
*
Visit our Part-Year Resident Forms Page for forms and instructions.

NOTE: If you changed your legal residence to another state but continued to maintain a permanent place to live in Connecticut for the entire year and spent more than 183 days in Connecticut in the aggregate during the taxable year, you will be considered to be a resident for that year.

By: Jahaza

Jahaza — Tue, 22 Jan 2008 17:44:50 -0800

Miko, here's the thing, even if the OP spent less than 183 days in CT, if he kept his license, kept a lot of stuff in Ct etc, they may not consider him to have changed his legal residence to NH. I moved to NY from VA in 2/05, but remained a nondomiciliary resident of VA until 3/06, when I'd gone from being a freelance to a permanent employee, finally changed all my mail delivery, changed my license, changed my voter registration, moved more of my stuff, etc.

As I understand it, changing your legal permanent residence is about intent, since they can't read your mind, they look at this other stuff.

By: Miko

Miko — Tue, 22 Jan 2008 19:02:05 -0800

That kind of investigation would only become an issue in an audit.