Bonus income - earned in previous state?

Forum|Forum|1 year ago
February 13, 2025
1 reply
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Hello -

Moved from a non-state-income-tax state to a state-income-tax middle of the year last year 2024.

A big part of our compensation at work is in the form of bonuses. They're paid mid-way through the following quarter.

I moved states middle of July. My bonus for April, May, and June was paid out in August.

Let's say my total W2 income for the new state was $100,000, but $15,000 of that was the bonus FOR the previous 3 months, just paid out after i moved

If I understand the way the process works, the question "How much of the $100,000 did you earn while living or working in state-x" -- I'd be able to honestly put $85,000, right? Because the bonus was paid out after I moved, but for the time period prior to the move?

want to make sure i'm doing this the honest way. the income, while paid after i made the move, was 'earned' prior to the move

Not A Product Question

Vanessa A

I'd be able to honestly put $85,000, right? Yes, generally, the income is taxed in the state it is earned so it was earned in your non tax tax it would generally be considered income from your non tax state. However, all states have different laws so which state do you live in now?

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lzoAuthor

New Jersey currently

In hindsight, there were some things I did that were just ignorant - as an example, the week after I moved, I sold some stocks, so now I'm paying the capital gains on both the federal AND state taxes. If I'd been smarter, I would have sold them prior to moving so I wouldn't have to pay state income taxes. But even though they're stocks that accumulated in value over the last few years, I understand that the fact I sold them DAYS after moving, I have to claim the full capital gain for my New Jersey taxes.

That part I understand, and makes sense - but the work bonuses I want to be sure I'm doing correctly