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Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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Next year 2010, I will be retiring from the navy. Since I

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Next year 2010, I will be retiring from the navy.   Since I have a Condo/Real Estate Income from both VA and CA, and will be retiring in N.Y, which will be my new state of residency (previously it had been CA), which state do I pay taxes to/do I file in?

I have filed (not had to pay since I was not living in the state since 1997) in CA.


Joe Gioello
Hello Joe,

You are liable for state taxes in:

1. The state where you are a resident and
2. Any state where you have income from a source within that state

Because you have rental income in both VA and CA, you will need to file a non-resident return with both of those states, and pay VA state tax on your VA rental income and CA state tax on your CA rental income.

That same income from both locations will also be reported on your resident NY return, but NY will allow you a credit for the taxes you already paid to both VA and CA. That will help to reduce or eliminate any double taxation at the state level on the rental income you receive.

Any other income you may have such as military reitrement pay or if you end up getting a job in NY will be taxable only in the state of NY.

If this was helpful please press the Accept button. Positive feedback is also appreciated.

Thank you Joe.

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