Need help with a taxes question....

[Alicnwondrln]

We will be moving over the summer as DH company is merging with a company in maine
we either need to move to kittery maine or a surrounding town.
DH was thinking of moving to newburyport or salisbury as it was right on teh border and was only 25 min away. We went to maine this weekned to look at teh company and the neighborhoods in kittery.
My step dad was telling us if we live in MA but DH works in Maine we will have to pay state taxes to both states and we wont get as much back cuz Maine will look at our income. I thought we would get everyting back from maine as we dont live there? I was wondering if anyone had any experience with this or knew of a web site I could find this info on. I have been looking this a.m. but i am not finding much.

Thanks

 

[bicker]

What is it with us Burlingtoners needing tax advice this morning?

http://www.disboards.com/showthread.php?t=1043409

Maybe someone knows of a reliable, inexpensive tax advisor in our area? Maybe we could get a two-fer!

 

[Bob Slydell]

States that close to each other should have a reciprocity agreement, whereas the state you're working in will collect taxes for the state you're living in. You'd have to check with your DH's company whether or not that's the case.

If not, then yes, you'll have to file two state tax forms, one for the state you're working in (should be a full refund) and the state which you're living in (you'll owe, but it should be about the same amount as the refund).

 

[Alicnwondrln]

howdy neighbor !! Sounds like yu had a good trip, I read your reports. Well I could certainly use some advice as if this is the case I will move right to maine and not stay in MA

 

[bicker]

I think Bob's got it backwards though -- as I indicated in my reply to your other message. You'll owe the income tax to the state you earn the income in, not the state you live in.

 

[Alicnwondrln]

States that close to each other should have a reciprocity agreement, whereas the state you're working in will collect taxes for the state you're living in. You'd have to check with your DH's company whether or not that's the case.

If not, then yes, you'll have to file two state tax forms, one for the state you're working in (should be a full refund) and the state which you're living in (you'll owe, but it should be about the same amount as the refund).

thanks I appreciate the info. This is a huge decision for us and we want to make the best one. THanks

 

[Poohgirl]

From what I understand yes that is true. Hopefully someone here has actual experience but Maine taxes are tricky that way. From what I remember, If you live in Ma and one works in Ma and one in Maine, Maine will in a way tax you on both through an allocation formula....then you will have to pay Ma taxes on total income earned (with perhaps a deduction for taxes paid). I you lived in Nh you would get taxed by ME on Maine wages earned and a portion (through the allocation formula) of NH wages earned if you worked in Nh but no NH taxes. and full taxes from maine if you both worked and lived in Maine. hope this helps...

edited to add...I would think the least desirable choice tax wise would be living in ma and working in Maine...

 

[Alicnwondrln]

Thanks poohgirl. We would both be working in maine but living in MA. This was very helpful

 

[Bob Slydell]

I think Bob's got it backwards though -- as I indicated in my reply to your other message. You'll owe the income tax to the state you earn the income in, not the state you live in.

I'm pretty sure the tax is owed to your residence state, not your employer state, but I could be wrong.

 

[bicker]

I suspect New York is very upset with me if that is the case!

 

[Bob Slydell]

Now that I'm thinking about it, I think you're right bicker. I just remembered that DW now has to file taxes in literally all 50 states because her firm (of which she's a partner now) does business in all states, not (obviously ) because she's lived in all of them.

 

[mickeyfan2]

My job has me working in different states than I reside in. Some states reciprocate and you only pay in the state you reside in. States like NY reciprocate with nobody and you owe them taxes. You will get a credit on part of the taxes you owe in your state, but I have never gotten 100% credit, so I do pay more than if I resided in the no-reciprocating state.

 

[bicker]

Yup. During some of those years, I paid taxes to California and Michigan, too. This became a really big deal a few years ago, because professional sports athletes were claiming all their income in the state their team was from, but the states that they were playing in wanted their share. It would clearly "even out" in the end, but not for each state -- states with poorer sports teams wanted their share of the richer states' sports teams' star players' salaries!

 

[mtdevine615]

If you work in Maine you will owe taxes to Maine. That's the bottom line, no way around it. Maine wants there money. If you worked in another state and DW worked in Maine and you file a joint return they will indeed tax your earnings also. It's not easy and I know you've been having a tough time deciding what to do but if it was me I'd move to Maine. Wait I already did. You might also try this site: http://www.maine.gov/

 

[Alicnwondrln]

If you work in Maine you will owe taxes to Maine. That's the bottom line, no way around it. Maine wants there money. If you worked in another state and DW worked in Maine and you file a joint return they will indeed tax your earnings also. It's not easy and I know you've been having a tough time deciding what to do but if it was me I'd move to Maine. Wait I already did. You might also try this site: http://www.maine.gov/

i went to that site this am
did some more research on it. We would get a credit for our MA taxes but not all of it. It would probably make more sense to be in Maine. We have been looking in Kittery, but they seem to have alot sex offenders in the area. I did a search and over 10 came up and its not a huge place. I am looking into the schools now and other stuff such as utilities. There is only comcast up there for cable, stuff like that. Thanks.

 

[Christine]

I live in Virginia, employer is based in Virginia, I work in DC. I only pay state tax to DC.

DH lives in Virginia, employer based in Maryland, he works in DC. He also only pays taxes to Virginia.

 

[mtdevine615]

The state tax laws are controlled by the state in which you work in and Maine is very creative about taxing. Alicnwondrln you may want to look at towns outside of Kittery, such as Elliot, Berwick or York. Again as in your other post the further away you get from the coast the less expensive housing will be. Utilities are pretty much a lock in southern Maine. Central Maine Power (CMP) for electric, sewer is supplied by the town and water is either provided by the town or a private company, unless you're on a well and septic system. Cable I think is Time Warner or Comcast. I know it's a huge decission to make but I'm glad I live in Maine even when I got my property tax bill the other day. Don't hesitate to PM me if you have other questions about Maine. I'm usually on the Dis everyday.