This wuflu situation drives us to work from home. Not all bad as it seems like this may be a good opportunity to try living in a different state.

What if I were to rent an apartment in a different state to test out living there? Obviously would still have to cover my mortgage and property taxes here. Insurance, utilities and the rest of the bills.

But what about income taxes? Assume my company still considers me a resident here. If I rented an apartment in a different state, would I just pay my current state taxes? Or prorated between the two states? How would the apartment state know? Does length of time matter? By renting an apartment, establishing utility services, would I be considered a resident of both states? What about car - would I have to register it in both states? Pay insurance based on where I am living? Establishing temporary residency would be not be bad as I could buy some things I would not be able to get otherwise.

Probably thinking 3-9 months depending how much I like the area.

Other complications I need to consider?

Most states will require that you obtain a driver license within a specified term of residency, typically 30 days. Same with automobile registrations/license plates. Voter registration requires residency within the state where you intend to vote, residency period may vary from state to state.

Income taxes will be required by each state for the period of your residency, and each state will expect a return to be filed as a part-time resident for your earnings during those periods. Some states may impose "source taxes" on income originating in that state even though you are not residing there (California and New York are known for this).

Licenses such as hunting, fishing, professional employment, concealed carry, etc. will be controlled by state of residence. Some states may require firearms registration (Illinois requires the Firearm Owner Identification Card), and some may restrict types of firearms and/or ammunition you may possess legally.

If you are looking at the southern states it may help to understand the difference between being a "Yankee" and being a "Damn Yankee". The Yankee comes for a visit, but the Dame Yankee shows up with a U-Haul.

Ugh. Sounds complicated. And can understand some complexity when actually moving - I lived in one state but will now live in another state moving forward. But this sounds more complex than I was anticipating for just a look-see. Just live in another state for a period with the intention of coming back.

I wonder if I could just rent a house or condo (as Airbnb?) for a period of time instead of leading an apt. Like an extended vacation of a few months. Except I’d be working from there. Would that be any different?

I'd wager, and this is not based off being an expert but more from personal experience, that no matter where ypu go, youll get nearly all the income tax from the state back. I would rent for 1-3 months at a time. And work in different states, and still get most all of it back.

Ypure situation is different, if you never change your residency, your state taxes will be based off the home on record with your company on your W4, regardless of where you actually work from. This is up to you to reconcile at the end of the year. See above paragraph.

Wherever the company is based can also impact that but its all based off what you file on your W4. So if your state of residence is florida, your company is based out of florida, and youre renting an apartment in alabama for 3 months to test the waters, unless you claim it they will never know you worked from home or for a company based in Alabama.

Now what im not sure of, is what actual laws are on the books for "working from home". BUT, id wager a time limit is involved.

If i take 2 weeks vacation and work while on vacation, i dont pay state taxes where im vacationing.

Dont change youre home of record or W4 until youre ready for a final decision.

ETA: Not a W4, but whatever the state equivalency is.

If you are still going to keep your existing house with your mortgage etc. I don’t think you have anything to worry about. If you were to get pulled over by a cop you can just tell him that you’re in town for work and keep you existing DL, registration etc.
You’re over thinking it.

You're over-thinking this. My daughter worked in 3 states one year. She had to file in all 3, which meant she hat to buy 3 extra TT tax packages. She did not suffer double taxation. As far as the car goes, you can keep your home state reg if you are a temporary resident.

Try to think like a regular schmoe. You're being way too conscientious.

quote:

But this sounds more complex than I was anticipating for just a look-see.

LoboGunLeather is correct, so is Fredward, smlsig & others. The comes down to your W2 & the address on the W2. I have music industry tax clients that may receive W2's for 20 states while working for a tour. Be careful about the address on the W2 as states compare W2's & Tax returns filed with their state on the address. I have a tax client that moved to Australia from CA, working for the same company. The company did not change her W2 address & 15 years later after moving back to the US in TN, California tried to collect back taxes she did not owe.

I'd ask your company for advice. I know my company is working through this policy right now, as we are going to be permanently transitioning a significant portion of the salaried workforce to remote work/work from home, but there are tax and other implications to work through for employers.

You might be making this too complicated.

I worked for a company that assigned me to projects all over the U.S.

I owned a home, paid property taxes etc., was a registered voter, had driver license and registration, all in my home state.

Never did any tax-related paperwork about the states where I had temporary residence. Never had a problem.

---

Years before that, I worked for a large flight training company based at Chicago's Midway airport. Destinations for training flights were left for the instructors and trainees to choose.

At one point, Wisconsin decided that they could tax revenue derived from flights through the air space over Wisconsin.

We had a staff meeting, with all instructors, and agreed that no training flights would go to or through Wisconsin. A letter was drafted and sent to the Wisconsin taxing authorities explaining that Wisconsin would receive no tax money from us for flying through "their" airspace, and there would be no further fuel purchases in the state, so their tax revenue from our business would actually decrease, in addition to the fuel vendors losing business.

quote:

Originally posted by V-Tail:
You might be making this too complicated.

I worked for a company that assigned me to projects all over the U.S.

I owned a home, paid property taxes etc., was a registered voter, had driver license and registration, all in my home state.

Never did any tax-related paperwork about the states where I had temporary residence. Never had a problem.

All this applies to me also, but I owned the company and did jobs all over the U.S. I was never in one spot for more than a few weeks, though, except for 2 months in Tokyo.

quote:

Originally posted by konata88:
Probably thinking 3-9 months depending how much I like the area.

Think of an extended vacation. When you're on vacation, you don't register to vote, don't get utilities set up, don't buy property, don't register your car, don't get mail there...you're unlikely to be treated as having set up a domicile if you don't do any of those things.

RE: will the state know? If you tell your company, they (rule-followers that companies are - they have a lot to lose if they play games) will will follow the rules, and if they are employing someone in a state (i.e. you) then they'll generally follow the withholding tax rules for that state.

That probably (not a tax lawyer) means that your state income tax withholding for that period would be done according to that state's rules and (again, not a tax lawyer) most likely be sent to them instead of your home state. In that case, you'd need to file a return in that state and coordinate with your home state's tax filing. This would be a pain, especially if you live in a no-income-tax state and were looking to check out a 'Preparation H income tax state' like CA while earning income there.

Side note: CA even taxes the earnings of visiting professional athletes who play in CA, based on the percentage of their games played in CA - I bet those who live in no-income-tax states are not thrilled with that.

RE: cars. There are states (CA being one of them) where they take a dim view of people moving there and driving with their out-of-state licenses to save onerous car taxes/regulations. If you're heading to one of those states, and will be driving with your own car (vs renting one or Ubering while you're there) that state's LEOs may take notice of a long-term use of out-of-state plates. While living in CA, I met a state LEO whose full-time job was going to large company parking lots (and other places) to keep track of out-of-state plates that stuck around for months.

So there is that chance that if you drive your own car while there, that the state may eventually cotton on, even without a company withholding tax hint.

Sounds like you intend to keep your legal residence where you are but, at least for a short period, temporarily live somewhere else. The following is based on that understanding.

Some states have implemented special COVID related rules recognizing that that, during this work from home situation, some people have decided to move back home with parents or temporarily changed work locations. As you do your research make sure to consider these new (and at times temporary) state rules.

While I did not read the responses (above) in detail, they do not seem to consider the COVID rules. Ignoring COVID, the conventional tax rules generally looked to see where services were provided and you would be subject to state income taxes based on where you worked. Since most states tax a resident on all income, to avoid double taxation, most states provide a tax credit for income taxes paid to a nonresident state.

Yeah, no thinking about a serious complex subject that might have significant financial consequences.

I have no idea whether it’s of any relevance to your question, but I’ve known of US government employees who lived for a time in Virginia, moved away and terminated their residence there and stopped paying taxes, moved back, and were required to pay their income taxes for the periods they were gone.

And yes, Virginia was also very aware of vehicles with out of state plates that hung around for any length of time. Plus, when I registered my car there that I had purchased while stationed in Germany, I had to pay VA sales tax on it.

Lots of possible rules; lots of possible consequences.

Don’t ask, don’t tell. Who would know, unless you notify them? Until you sell or long term rent out your current owned home, that is your anchor for residency. Anywhere else is just an extended vacation. I wouldn’t even tell your employer, why would they need to know if you are 100% remote?

I also think...you're over-thinking it. Your job location and residence as evidenced by your mortgage and utilities and vehicle registration/DL is not changing. Nobody is checking where you sleep each night nor does it matter.

Just temp rent the place for a few months and like others said it is an extended vacation, your residency didn't change nor where you earned your income which are the things that matter.

If you decide to move permanently, you'll have a head start on that residency history in the new state so that's an advantage.

quote:

Originally posted by konata88:
Ugh. Sounds complicated. And can understand some complexity when actually moving - I lived in one state but will now live in another state moving forward. But this sounds more complex than I was anticipating for just a look-see. Just live in another state for a period with the intention of coming back.

I wonder if I could just rent a house or condo (as Airbnb?) for a period of time instead of leading an apt. Like an extended vacation of a few months. Except I’d be working from there. Would that be any different?

It depends on the state as far as residency goes. Here in Florida you only have to be here something like/around 183 days a year to be considered a resident. You would be considered a resident here and pay ALL taxes here and everything here. It does not matter where you spend the rest of the time. I have several clients like that, that work in NJ/NY and live here.......spend the 183 days here (over the course of a year) and don't pay state taxes in the NY/NJ. You're over thinking this.

As far as renting, an extended stay hotel is an option. Something like Air BnB is an option.

Its becoming a big issue with COVID and people working from home. Consider NY is of course first on the list for going after taxes from people working from home in CT or NJ during the Pandemic.

Agree with some, I'd just not say anything about being in TN to your home office unless you have some kind of employment issue where you could lose the job if you don't report being elsewhere..

Otherwise, you're taking a vacation, working remote from your mountain top cabin, the other issue is if you work from home and your company tracks the IP address for security, it's going to be different if you have internet access elsewhere.

Lots of articles online about it, apparently a hot issue this year in Tax circles.

https://www.cnbc.com/2020/11/2...-remote-workers.html

Thanks guys. There was a secondary objective but seems like that would complicate things.

1) Check out possible new living location. Sounds like I just treat this as an extended vacation stay even if I rent an apt and set up utilities for 3-6 months.

2) Purchase things that are otherwise limited by a roster in my state. But this would require establishing a parallel residency in the temporary location. At least I assume so - unless showing my apt lease and utility bill is sufficient to make purchases. But this is a secondary purpose - can forego this objective if it makes financials too complicated.

Before I moved to the Yoop from Ohio, I subscribed to the local paper and watched the local news online. I then made several short duration trips to scout housing and other details. I also talked to the cops I saw in the area to get the straight story on areas to avoid.
Pardon me for asking, but why do you think you need several months to get a feel for the area you wish to move to?

I'd like to get familiar with the general area (probably ground zero + 60 mile radius). Get familiar with the local cultures and vibe. Understand the pro/cons for each micro-area / neighborhood. Look into zoning trends, population trends, etc.

This next move is intended to be the forever home. Trying to make sure I get it right to minimize costs and effort to move again.

Generally like where I live now BUT the neighborhood has changed over the years. I wouldn't have bought here had I known then what I know now. I should have checked in more details the zoning and planned development and growth.

I want to try to make a boots down detailed assessment of various potential areas (zero + 60 miles) so that I can choose carefully using data.

I know, I know - I'm too paranoid, anal and overthinking as usual. I can't change my spots.