Moved states this year, tax question (interest/miscellaneous income).

November 11, 2024 9:36 AM

YANML/CPA; I figured my question would be simple and straightforward. I moved to another state around mid-year, earned interest (savings account) and had some miscellaneous income earned while living in one state.

Will tax reporting software (such as HRBlock/TurboTax/FreeTaxUSA/etc) allow me to report/divide interest and miscellaneous income earned in one state and in another?

For example:

State A: Earned $50 in interest and $250 in miscellaneous income
State B: Earned $70 in interest and $0 in miscellaneous income

I know the software allows for dividing/assigning earned amounts from W4's because they can import W4's. However, not sure about 1099s for interest and self-reporting miscellaneous income? I don't want to report my earned interest and miscellaneous income to one state only.

Thanks!

posted by thoughtful_analyst to Law & Government (4 answers total)

Each state has different laws about part year returns and different forms. But in general, in my experience, they start with what you reported on your federal return and then you report what percentage or what amount of each item applies to their state. So yes each type of income is divided, but you the taxpayer report what that division is, the tax software doesn't decide for you.

The tax software in my experience does not hold our hand as much on state returns, I had to do some reading of the tax form instructions and help documents to understand what exactly to enter.
posted by muddgirl at 9:51 AM on November 11

Do you have state income tax in both states? I used a tax professional to handle the year I had state income tax in two states, but I recently moved from a state with income tax to a state without income tax and TurboTax handled that acceptably enough for me (not a recommendation for TurboTax, it's just what I used at the time). It explicitly asked if I was residing at my current address for the whole year and went from there.
posted by Aleyn at 4:07 PM on November 11

Response by poster: Yes re: both states.

As long as I'm able to divide/assign specific income for interest earned/miscellaneous income to each state, I'm good. Thanks!
posted by thoughtful_analyst at 6:19 PM on November 11

Yes, I've done this with Turbo Tax. You do have to pay separately for 2 different state tax returns (plus pay for federal), but to me it was worth it to have it all done.
posted by hydropsyche at 3:06 AM on November 12