Part year residency when taking a few months to travel to different states between domiciles

Forum|Forum|2 years ago
March 25, 2024
1 reply
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My spouse and I moved in 2023 and have questions about part year residency and which states we should pay taxes to. We sold our CO house in May, took a couple months to travel including a 30 day stay in WA, and rented a house in MA after August. Throughout 2023 we earned monthly investment income (Capital gains, interest, and dividends), with no employment income.

Should we only pay taxes to CO and MA, with residency switching once we domiciled in MA? I am confused about what residency means when we didn't have a home and spent a couple months traveling. Thanks for the help!

TomK2023

You are a part-year resident in Colorado; and a part-year resident in Massachusetts.

You're a part-year resident if you: Move to Massachusetts during the tax year and become a resident. Not only must a person maintain a permanent place of abode in Massachusetts, but a person must also spend more than 183 days in Massachusetts to meet the definition of a resident.

Massachusetts Department of Revenue: Legal and Residency Status in Massachusetts

Be sure to indicate in your Persona information section that you moved to MA during 2023, and the date you first 'began renting/living there.

If you need to add this information after you've begun your return:

Sign in to TurboTax and select My Info.
A Your personal info screen appears.
Question number 2 asks you the state(s) you lived in during 2023. Select your state of residence from a dropdown menu (Massachusetts).
You'll also be asked if you lived in another state in 2023. Answer Yes and a new section will appear asking for your previous state of residence. Select the other state you lived in (Colorado).
Fill out the date of when you moved to your current state (Massachusetts).
If the rest of your information is accurate, select Continue.

After you finish entering your federal return info, you'll automatically move to the State Taxes section, where you'll see your part-year states listed. We suggest you prepare the return for your former state first, followed by the return for the state you currently live in.

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kawishiwiAuthor

Thanks! So does this mean we will still be residents of CO up until we rent a house in MA, even though we won't physically own a home or be in CO for May-July?

Vanessa A

Yes, where were you still getting mail, where was your drivers license and vehicles registered to? Until you took the steps to make another state your permanent home, your resident state would remain CO. Once you rented a house or took steps to make MA your permanent home (drivers license, registration, etc) then CO stopped being your home and MA became your home. So if you did that when you sold your house, then for May through July, MA would be your home. If you didn't take steps until August to make MA your home, then May through July CO would be your home.

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