Author Topic: Taxes if Living in CO but working in TX  (Read 4270 times)

FrontRanger

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Taxes if Living in CO but working in TX
« on: July 22, 2024, 07:08:37 AM »
I am going to be required to work out of our Texas facility 3 days a week, but will still have CO residency and live there while I travel back and forth. I don’t want to relocate, but want to know what the state income tax situation would be for me. I know Texas has zero state income tax, so would I be able to not pay income tax while I’m in the state of Texas? Or do I have to pay CO tax on the full amount earned?

morethanconquerors

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Re: Taxes if Living in CO but working in TX
« Reply #1 on: July 22, 2024, 07:56:49 AM »
Since you are a CO resident, your full income would be taxed as CO income, even if earned in TX. This is assuming you meet the definition of "resident" per the CO tax code.

reeshau

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Re: Taxes if Living in CO but working in TX
« Reply #2 on: July 22, 2024, 08:06:10 AM »
Not a tax attorney, but I don't think parts of weeks is going to cut it, to get yourself defined as a part-year resident:

"A part-year resident is an individual who was a resident of Colorado for only part of the tax year. This includes anyone who moved into Colorado with the intention of making his/her home here or a Colorado resident who moved out of Colorado with the intention of making his/her home elsewhere any time during the tax year."

Colorado would allow you a credit for taxes paid in another state, but of course you don't have that in Texas.
« Last Edit: July 22, 2024, 08:07:46 AM by reeshau »

FrontRanger

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Re: Taxes if Living in CO but working in TX
« Reply #3 on: July 22, 2024, 09:15:36 AM »
Yes, I think it is the fact there is no state income tax in TX, so can’t take a credit of taxes paid in another state.

Phazed

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Re: Taxes if Living in CO but working in TX
« Reply #4 on: July 26, 2024, 12:23:03 PM »
Married to accountant who does a lot of my friend's taxes in many states, so I have picked a lot of this up over the years. This is not tax advice.

You can reduce your CO taxes by the time you are actually spend out of state. Make sure to keep accurate travel records. If you spend 183 days in a state, that state can claim you them taxes. If you are doing this, I highly recommend you get a (good) tax professional who understands your situation. I yell at all my friends about that; some of them insist on doing their own taxes until they come to my wife once because they have an odd year. Then, they pretty much stay for life (even after moving to other states) because they find out that were overpaying on so many things.

SeattleCPA

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Re: Taxes if Living in CO but working in TX
« Reply #5 on: July 29, 2024, 04:27:20 AM »
I am going to be required to work out of our Texas facility 3 days a week, but will still have CO residency and live there while I travel back and forth. I don’t want to relocate, but want to know what the state income tax situation would be for me. I know Texas has zero state income tax, so would I be able to not pay income tax while I’m in the state of Texas? Or do I have to pay CO tax on the full amount earned?

You'll have to pay CO taxes because you're a CO resident.

CO makes the rules here and "Part 1" on this web page explains those rules: https://tax.colorado.gov/individual-income-tax-guide

Quote from: Phazed
You can reduce your CO taxes by the time you are actually spend out of state. Make sure to keep accurate travel records. If you spend 183 days in a state, that state can claim you them taxes. If you are doing this, I highly recommend you get a (good) tax professional who understands your situation. I yell at all my friends about that; some of them insist on doing their own taxes until they come to my wife once because they have an odd year. Then, they pretty much stay for life (even after moving to other states) because they find out that were overpaying on so many things.

The above is incorrect or maybe incomplete is better description. The issue is, @FrontRanger is still domiciled in CO.

BTW if you, @FrontRanger , were earning income in a a state with income taxes, probably you'd get a credit on your Colorado return for the taxes you paid to the other state.


 

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