For the first 5 months of 2021, I was a Massachusetts resident working remotely for a company based in Maryland. In June, I permanently relocated to MD to begin reporting in-person for the same job. I have been a permanent resident of MD since moving. I need help determining how to file my state taxes and allocating my wages between both states.Am I correct to file two state returns: Part-Year Resident for MA and Part-Year Resident for MD?Both forms require me to specify how much of my total listed income was from each respective state. Do I split my wages between both states based on how long I worked in each physical location - i.e. 5/12 of my annual income gets taxed by MA only and 7/12 of my income gets taxed by MD only? Or does MD tax all of my annual income because I worked for a MD-based company for the whole year and MA only taxes the income I made while I was a MA resident (first 5 months)?Do I qualify for "taxes paid to another state" for either MD or MA?Any help is appreciated!

Question

Remote Worker & Part-Time Resident MD and MA

Forum|Forum|4 years ago
March 6, 2022
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For the first 5 months of 2021, I was a Massachusetts resident working remotely for a company based in Maryland. In June, I permanently relocated to MD to begin reporting in-person for the same job. I have been a permanent resident of MD since moving. I need help determining how to file my state taxes and allocating my wages between both states.

Am I correct to file two state returns: Part-Year Resident for MA and Part-Year Resident for MD?
Both forms require me to specify how much of my total listed income was from each respective state. Do I split my wages between both states based on how long I worked in each physical location - i.e. 5/12 of my annual income gets taxed by MA only and 7/12 of my income gets taxed by MD only? Or does MD tax all of my annual income because I worked for a MD-based company for the whole year and MA only taxes the income I made while I was a MA resident (first 5 months)?
Do I qualify for "taxes paid to another state" for either MD or MA?

Any help is appreciated!

E

ErnieS0

Yes. You are correct in filing part-year returns for Massachusetts and Maryland.

Split your income based on the amount you earned while living in each state. Your company should have done that for you on your W-2.

Do you have a Massachusetts and Maryland line with wages and state withholding? On a W-2 for each state? Use those numbers if you have them.

Maryland does not tax remote workers so you only owe Maryland tax on income you earned while living in Maryland.

There is no other state tax credit because there is no income overlap. You can only claim a credit if both states tax the same income. In your case, you are dividing your income between MA and MD.

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