I recently moved to MD. My salary doesn't deduct the state taxes, only the federal taxes. Can I not pay state taxes now but plan to pay when filing taxes in Jan 2024

Forum|Forum|2 years ago
April 5, 2024
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Best answer by Vanessa A

If you do not pay state taxes now, you will be hit with an underpayment penalty and interest when you file in 2024. It is best if you make quarterly payments to avoid penalties.

Maryland Tax Connect

Vanessa AAnswer

If you do not pay state taxes now, you will be hit with an underpayment penalty and interest when you file in 2024. It is best if you make quarterly payments to avoid penalties.

Maryland Tax Connect

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beeg203298Author

Thank you. I wanted to know whether I can pay my taxes via the comptroller's office in MD and file them using TurboTax. Or should I file them through the same service (comptroller of MD online) where I paid my taxes?

Vanessa A

You should pay them quarterly through the comptrollers office. You could then file the return in 2024 through TurboTax and enter the estimated payments you made through the year to the comptrollers office.

When you do this you will select the following:

Federal
Deductions and Credits
Show More next to Estimates and Other Taxes Paid
Estimated Tax Payments

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TomD8

Employee

Why isn't your employer withholding MD taxes? Is your job located in a neighboring state?

**Answers are correct to the best of my ability but do not constitute tax or legal advice.

beeg203298Author

Yes, My job is located in a neighboring state (Nebraska). The employer said they could not deduct it as it is a state that is not comparable to Maryland.

TomD8

Employee

@beeg203298 --

Be aware that Nebraska is one of very few states that have a "convenience of the employer" rule for non-resident remote workers. Here is the text of Nebraska's law:

"If the nonresident's service is performed without Nebraska for his or her convenience, but the service is directly related to a business, trade, or profession carried on within Nebraska and except for the nonresident's convenience, the service could have been performed within Nebraska, the compensation for such services shall be Nebraska source income."

https://www.law.cornell.edu/regulations/nebraska/316-Neb-Admin-Code-ch-22-SS-003#:~:text=Compensation%20received%20by%20a%20nonresident%20will%20be%20considered%20Nebraska%20source,performed%20in%20Nebraska%20are%20an

Nebraska can tax non-residents on "Nebraska source" income.

A bill has been introduced in the Nebraska legislature which would repeal its "convenience of the employer" rule, but that bill has not yet been passed.

https://legiscan.com/NE/text/LB173/2023

**Answers are correct to the best of my ability but do not constitute tax or legal advice.