Do I have to file state taxes?

I know I have to file US federal taxes plus a return in the UK. But what about a state return?

I've taken a lot of measures to break California residency and haven't lived there since July of 2005. I went ahead and filed a state return last year, but do I have to file a California return this year?

If no, do I simply not file a state return? Or would I file a return based on my domicile of birth (Illinois)?

With thanks,

Clarelynn

Well, I can say that if you haven't lived in Illinois for a year, you are not considered a resident of Illinois.

Don't know about California though!

It's worth checking your State's tax administration website.  I last lived in Virginia and unfortunately, they consider you a domiciled resident for the rest of your life until you move to another State:  http://www.tax.virginia.gov/site.cfm?alias=ResidencyStatus#INDIVIDUALSABROAD

This is really annoying as it means I need to file with VA every year even though I never owe anything nor am eligible for a refund.  I think only a handful of States actually impose this type of law, however, and you might be lucky with California.

Hi there -

Always happy to help a fellow Californian. 

Two questions:

1) Have you been back to CA at all in the past year?  For how long? 

If you have a residence and significant ties elsewhere and have been out of the state for longer than 9 months and have less than $200K total income, then you are no longer a CA resident for tax purposes. You don't have a requirement to file, but be prepared to show where you were all that time when or if you return to the Golden State. 

2) Do you have any income in the state?  If so, you need to file form 540NR.  You may not have a tax liabilty, but you still need to file. 

Check out http://www.ftb.ca.gov/forms/06_forms/06_1031.pdf for instructions, forms and examples that might help you determine where you stand.  Keep in mind, though, that unless you have a high net worth and significant ties to the state of CA, that CA is by and large only interested in income earned within the state of CA.

It's worth checking your State's tax administration website.  I last lived in Virginia and unfortunately, they consider you a domiciled resident for the rest of your life until you move to another State:  http://www.tax.virginia.gov/site.cfm?alias=ResidencyStatus#INDIVIDUALSABROAD

This is really annoying as it means I need to file with VA every year even though I never owe anything nor am eligible for a refund.  I think only a handful of States actually impose this type of law, however, and you might be lucky with California.

That is crazy!

That is crazy!

Yeah, I can't work out the rationale behind this.  Why can other States let their residents go when they permanently leave the State??

Excellent -- have really truly left the state. So that is good news!

Thanks very much,

Clarelynn

You're welcome! 

I have never been any good at this tax business as I always had someone else do it.  Does anyone know where I can look up wether I need to file Iowa state taxes?  I have had a look at the Iowa Department of Revenue and it makes absolutely no sense to me.  Is there somewhere else I can check?  Thank you to anyone who can help!

I am sorry to say that you are required to file unless you have abandoned domicile in Iowa.

Iowa looks at items such as exercising voting rights in Iowa and claiming homestead credits; certainly voting in Iowa will lead the State to argue that you are still demonstrating rights of citizenship in Iowa.

You'd have to definitely have left the State and be able to show intention never to return to escape Iowa domicile.

This could however significantly increase your UK tax bill if you appear to be domiciled over here, so a careful review of your facts would be needed to figure out what actions/filings save you the most money overall.

I am sorry to say that you are required to file unless you have abandoned domicile in Iowa.

Iowa looks at items such as exercising voting rights in Iowa and claiming homestead credits; certainly voting in Iowa will lead the State to argue that you are still demonstrating rights of citizenship in Iowa.

You'd have to definitely have left the State, and be able to show intention never to return, to escape Iowa domicile.

This could however significantly increase your UK tax bill if you appear to be domiciled over here, so a careful review of your facts would be needed to figure out what actions/filings save you the most money overall.

This could however significantly increase your UK tax bill if you appear to be domiciled over here, so a careful review of your facts would be needed to figure out what actions/filings save you the most money overall.

How could this be? If she's not working in Iowa and is not domiciled in Iowa, why would that give her a larger UK tax bill?

Doesn't make sense (but maybe I'm just stupid).

I am a bad expat... how can I find out what years I haven't filed for Federal and State taxes? I don't owe anything but all my records are buried somewhere in storage back in the states.


I was a full time California resident before moving abroad in 2002.

Yael,

If you are domiciled in the UK, you pay tax in the UK on your world-wide income - including income earned offshore and in the US and not remitted to the UK.

If you are not domiciled in the UK (and most Americans claim US domicile), you pay tax in the UK on your UK-source income only, plus any offshore income and US income remitted to the UK.  No remittances, no UK tax.

By declaring to Iowa that you are never returning (in order to break Iowa domicile), you are also declaring this to the UK.  You can't say one thing to Iowa and a different thing to the UK.  Making such a declaration increases your UK tax by making you UK domiciled.

Olive,

You can send away for a transcript of your Federal records by filling in a 4506-T (free) or 4506 (costs money), both available on the IRS website.  The results from a 4506-T may require an expert's eye to be able to decipher, whereas the results of your 4506 is an actual photocopy of your tax return.  If you filed paper returns, it will be easier to understand the results of the 4506.

Your state may have a similar procedure.  Visit your state's tax department website to see what the procedure might be.  If you can't find one, you can call their hotline and ask.