Tax Question?

songkrai · 03-17-2011, 11:30 PM

All of those who work in a neighboring state do have to file and pay income taxes to the neighboring state.

This is all lost revenue for New Hampshire. How many people live in NH and pay income taxes in MA, VT, and ME is not easy to calculate. Nor is the amount of revenue lost by New Hampshire to those neighboring states.

neckdweller · 03-18-2011, 03:31 PM

Quote:

Originally Posted by songkrai

All of those who work in a neighboring state do have to file and pay income taxes to the neighboring state.

This is all lost revenue for New Hampshire. How many people live in NH and pay income taxes in MA, VT, and ME is not easy to calculate. Nor is the amount of revenue lost by New Hampshire to those neighboring states.

If NH ever set up an income tax, I'm pretty sure New Hampshire wouldn't be able to collect income tax if the income is from a neighboring state unless the NH tax was higher. For example, my MA income is taxed at (rounded) 5%. NH would be entitled to collect taxes on my income only if their tax rate is above that 5%. This is similar to how Massachusetts sets up their tax returns - you get a credit for any tax paid to the state where the income was earned.

Rattlesnake Guy · 03-18-2011, 06:57 PM

From the Tax Policy Center

Income tax is generally imposed by the state in which the income is earned. However, various states have entered into reciprocity agreements with one or more other states that allow income earned in another state to be taxed in the state of residence. For example, Maryland’s reciprocity agreement with the District of Columbia allows Maryland to tax income earned in the District by a Maryland resident. As of 2004, sixteen states had adopted reciprocity agreements; typically these are states with employment centers close to a state border and large flows in both directions.

I think Massachusetts would be foolish to enter such a reciprocity agreement with New Hampshire due to the lopsided balance of Mass earners to NH earners who cross the boarder each day. A simple view of the traffic in the morning says it all.

no-engine · 03-23-2011, 09:30 PM

I have not read all the posts on this thread.
HOWEVER, I CANNOT STRESS ENOUGH THAT A FORUM SUCH AS THIS IS NOT THE PLACE TO OBTAIN LEGAL, ACCOUNTING ADVICE.
ONE SHOULD SEEK PROFESSIONAL ADVICE IN A CONFIDENTIAL SETTING.

03-18-2011, 06:57 PM	#3
Rattlesnake Guy Senior Member Join Date: Sep 2004 Posts: 1,254 Thanks: 423 Thanked 366 Times in 175 Posts	No free lunch From the Tax Policy Center Income tax is generally imposed by the state in which the income is earned. However, various states have entered into reciprocity agreements with one or more other states that allow income earned in another state to be taxed in the state of residence. For example, Maryland’s reciprocity agreement with the District of Columbia allows Maryland to tax income earned in the District by a Maryland resident. As of 2004, sixteen states had adopted reciprocity agreements; typically these are states with employment centers close to a state border and large flows in both directions. I think Massachusetts would be foolish to enter such a reciprocity agreement with New Hampshire due to the lopsided balance of Mass earners to NH earners who cross the boarder each day. A simple view of the traffic in the morning says it all.

Thread Tools
Show Printable Version Email this Page
Display Modes
Switch to Linear Mode Hybrid Mode Switch to Threaded Mode

03-17-2011, 11:30 PM	#1
songkrai Senior Member Join Date: Dec 2009 Posts: 742 Thanks: 35 Thanked 149 Times in 101 Posts	All of those who work in a neighboring state do have to file and pay income taxes to the neighboring state. This is all lost revenue for New Hampshire. How many people live in NH and pay income taxes in MA, VT, and ME is not easy to calculate. Nor is the amount of revenue lost by New Hampshire to those neighboring states.

03-23-2011, 09:30 PM	#4
no-engine Senior Member Join Date: Jul 2008 Location: West side Winnipesaukee, Lakes Region Posts: 516 Thanks: 20 Thanked 52 Times in 40 Posts	I have not read all the posts on this thread. HOWEVER, I CANNOT STRESS ENOUGH THAT A FORUM SUCH AS THIS IS NOT THE PLACE TO OBTAIN LEGAL, ACCOUNTING ADVICE. ONE SHOULD SEEK PROFESSIONAL ADVICE IN A CONFIDENTIAL SETTING.

The Following User Says Thank You to no-engine For This Useful Post:
RLW (03-27-2011)