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Old 03-19-2014, 01:39 PM
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Red face 401K distributions and part year residency

I need help!

I worked and lived in Indiana all of my life up until Feb of 2013. I took a job in California, and began the process of relocating.

I began work at my new employer on Feb. 11, 2013, while staying in temporary housing provided by them for 30 days. My wife and son were tasked with packing and finalizing the move in Indiana while I was in California. Prior to my 30 day housing ending, I withdrew my 401K account, and had it deposited in my Indiana bank account. This happened prior to me having an established California residency, but after I had begun to work in California.

I am filing returns for both California and Indiana based on part-year residency, but my question is am I responsible for paying taxes to both Indiana and California on the full amount of the distribution, or would it be pro-rated to both states, or to only 1 state entirely?

I could use some help quickly.

Thank you for your time



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Old 03-21-2014, 07:06 AM
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Originally Posted by raidermanz View Post
, but my question is am I responsible for paying taxes to both Indiana and California on the full amount of the distribution, or would it be pro-rated to both states, or to only 1 state entirely?

I could use some help quickly.

Thank you for your time
aslongas you are subject to Tax/penalty on the w/d from your 401K, (the w/d occurred in CAas you said,” while I was in California. Prior to my 30 day housing ending, I withdrew my 401K account, and had it deposited in my Indiana bank account), as a part year resident of CA, you need to pay tax on it to CA, NOT IN.You need to pay tax only on CA source income to CA and vice cersa; you , as a part year resident of IN, need to pay only IN source income to IN



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Old 03-21-2014, 10:17 AM
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To be clear

Thank you for answering my question, but to be clear, all of the distribution money was earned while I worked in Indiana. I had not created a residency in California until after I received the money. I was already working in CA, but nothing other than my new employment pay stub shows me as a resident of CA.

Thanks again for your time and effort.



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Old 03-21-2014, 02:23 PM
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Originally Posted by raidermanz View Post
Thank you for answering my question, but to be clear, all of the distribution money was earned while I worked in Indiana. I had not created a residency in California until after I received the money. I was already working in CA, but nothing other than my new employment pay stub shows me as a resident of CA.

Thanks again for your time and effort.
then as said aslongas your w/d from 401k is taxable to IN, you need to pay tax on the W/D to IN not to CA state; you need to pay tax only on CA source income to CA as a PT resident of CA.



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