When do i have to file a State tax return?

David, Thank you for finishing my 2009 tax returns but why?? oh WHY?? have you prepared Pennsylvania, New York and Massachusetts Tax returns as well as my Virginia return.  I live in Virginia. What difference does it make if i work a day in New York and 2 weeks in Massachusetts?

david ingram replies:
This is / was actually a phone call that i have taken the liberty of making into a written question and for the record, even some of the states are different.
But, it is an easy question to answer.  Back when we had the NBA Grizzlies in Vancouver, I prepared two members' tax returns and we filed about 23 tax returns for them,.  Apparently we were the only two of all the Grizzlies and Toronto Raptors to file the State returns for the players because three years later, every Grizzly and Raptor was reassessed by all the states they played in when they had not filed their state returns.  An NBA official had written a TWO page letter to the Grizzly and Raptor management.  On page ONE of the letter, it informed management that the Management of these two CANADIAN NBA teams did NOT have to make deductions for individual states.  Page TWO of the letter had a paragraph which stated that it was up to individual players to pay their tax on their own.


Unfortunately, the Management of Both teams posted Page ONE on the board to explain why they were not deducting state taxes but neglected to put page TWO up.  Most of the players took the letter to mean that they did not have to pay US state taxes because they were working for a Canadian team.
Over the years I have only had clients  chased down by Georgia, California,  New York and Illinois.  This morning, May 26, 2010 I was phoned by a New York State Tax Assessor trying to locate a client who had lived in New York and received some money from their New York employer a year after leaving the state.  New York is the only state i know of at the moment which is tracking down telecommuting employees.  Yep, if you live in Nashville and telecommute to New York state, expect to pay new York state tax on your earnings.
See this older New York Times article for more details.
and this more recent one for what is going on now...
States Look Beyond Borders to Collect Owed Taxes
Published: March 21, 2010
When Josh Beckett pitches for the Red Sox at Yankee Stadium, New York collects income tax on the portion of his salary that he earned in New York State. 
But what about a Boston Scientific sales representative who comes to New York to pitch medical products to a new client? New York has decided it wants a slice of that paycheck, too. 
Anyone who crosses a state border for work — to make a sales call, say, or meet with a client or do a road show on Wall Street — probably owes income taxes in that state. 
If you live in Boston but spend one out of 250 workdays this year in New York, you owe New York income taxes on 1/250th of your salary. And vice versa if you are a New Yorker visiting Boston — or Anywheresville, for that matter — for business. ...
Read the rest of the article by following the link - and think hard about how much time you spend, on business, in each of the States. Are you filing your State tax returns? Even if you're Canadian, you should be doing so.


Trackback URL for this entry: http://www.centa.com/trackback.php/WhenDoYouHaveToFileStateTaxReturn

No trackback comments for this entry.