Moving to a new state could mean you're eligible for certain tax deductions. Find out how to approach your taxes during this special situation.
Video transcript:
Hello, I’m Adrienne from TurboTax with an easy tax prep checklist you can use if you’re moving between states.
Number one on our checklist: Find out if the state you’re moving to collects personal income taxes and what those rates are.
Number two: Income you make from pensions, interest and dividends on your investments, is taxable by the state where you live as a permanent resident. So a portion of your income might be taxable in each state if you move in the middle of the year.
If you still have a bank account in your old state, only your new state will expect you to pay tax on your investment income, so you shouldn’t be taxed twice.
Number three: If you have rental property or business in your old state, expect to file a return for both states. If the rental or business income is taxable by your old state, your new state should give you a credit for the amount of tax you paid.
Number four: Just because an investment you made in your old state was tax-exempt, you can’t assume it will be tax-exempt in your new state because each state has different rules.
And number five on the checklist: Keep all moving expense receipts. If you are moving because of work, those expenses may be tax deductible.
For more tips and information to help you get your taxes done smarter, visit TurboTax.com.
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