Welcome Guest. Register Now!  


For 2013 Tax Tips For Year 2013.


Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 03-25-2014, 11:03 AM
Junior Member
 
Join Date: Mar 2014
Posts: 2
I have to pay MI taxes just because I filed a federal Joint return with person who is a resident of MI?

Hi All, I have been a resident of North Carolina for all of 2013 and some of 2012, I have my car registered, my full time job, my apartment. I never intend to return to my old state of MO, or to ever move to MI (where my wife lives).

Due to Job and Family, my Wife has lived in Michigan all of 2013, and some of 2012. She too has a part time job, car, and family Home in Michigan. Will probably never move to NC or return to MO.

Clearly, NC allows me to File a Joint Federal Return, and a Individual State Return. Filing Requirements

I filed a Joint Federal return, using my address in NC, and my USAA bank in Tx.

Michigan is where I have the question. In the MI-1040 instructions it says :Who Must File a Joint Return. File a joint Michigan return if you filed a joint federal return. If you and your spouse filed separate federal returns, you may
file separate or joint Michigan returns. You may file a joint return only with your spouse.
michigan.gov/documents/taxes/1040_Book_443494_7.pdf

Because NC does not adjoin MI, there is no automatic reciprocity agreement, and due to tax exemptions I pay a very low effective tax rate in NC. While the MI tax rate is a flat 4.25%, I would have no exemptions, and would have to pay income tax.

Am I misunderstanding it, that I have to file a Joint MI tax return? Common sense would say I only need to have my wife file, after all she is a resident and has income in MI, and I have neither. Is it right that I have to pay MI taxes just because I filed a federal Joint return with person who is a resident of MI?

Thanks



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 03-26-2014, 12:21 PM
Moderator
 
Join Date: Oct 2010
Posts: 5,258
Quote:
Originally Posted by GordonD View Post
Hi All, I have been a resident of North Carolina for all of 2013 and some of 2012, I have my car registered, my full time job, my apartment. I never intend to return to my old state of MO, or to ever move to MI (where my wife lives).

Due to Job and Family, my Wife has lived in Michigan all of 2013, and some of 2012. She too has a part time job, car, and family Home in Michigan. Will probably never move to NC or return to MO.

Clearly, NC allows me to File a Joint Federal Return, and a Individual State Return. Filing Requirements

I filed a Joint Federal return, using my address in NC, and my USAA bank in Tx.

Michigan is where I have the question. In the MI-1040 instructions it says :Who Must File a Joint Return. File a joint Michigan return if you filed a joint federal return. If you and your spouse filed separate federal returns, you may
file separate or joint Michigan returns. You may file a joint return only with your spouse.
michigan.gov/documents/taxes/1040_Book_443494_7.pdf

Because NC does not adjoin MI, there is no automatic reciprocity agreement, and due to tax exemptions I pay a very low effective tax rate in NC. While the MI tax rate is a flat 4.25%, I would have no exemptions, and would have to pay income tax.

Am I misunderstanding it, that I have to file a Joint MI tax return? Common sense would say I only need to have my wife file, after all she is a resident and has income in MI, and I have neither. Is it right that I have to pay MI taxes just because I filed a federal Joint return with person who is a resident of MI?

Thanks
I have to pay MI taxes just because I filed a federal Joint return with person who is a resident of MI? ==============>>>>>>>I do not think so UNLESS you earn taxable income in MI as a full year/Part year or non resident of MI.




Because NC does not adjoin MI, there is no automatic reciprocity agreement, and due to tax exemptions I pay a very low effective tax rate in NC. While the MI tax rate is a flat 4.25%, I would have no exemptions, and would have to pay income tax.=============>>>>>>>Correct aslongas MI tax rate > NC rate, you neeed to pay additional tax to MI.

Am I misunderstanding it, that I have to file a Joint MI tax return? Common sense would say I only need to have my wife file, after all she is a resident and has income in MI, and I have neither. Is it right that I have to pay MI taxes just because I filed a federal Joint return with person who is a resident of MI?=================>>>>>>>As said, UNLESS you earned taxable MI source income that you earned in MI you do not need to file your MI return jointly with your spouse that is a full year resident of MI. So you can still file your fed return as MFJ and do notneed to file your MI return as you did not earn any MI source taxable income in MI but you need to file your NC as MFS UNLESS your spouse wants to file NC return with you jointly. Normally, states require that you file in the same way you filed your federal tax return. However as you and your wife live in two different states, AND neither of you has any income from sources in the other's home state, THEN you can each file as Married Filing Separately for your home state income tax return, even though you filed as Married Filing Jointly on your federal return. In this way you are taxed by NC on your income, she is taxed by MI on her income, and neither has to report your income to the other's state. You need to consult the tax publications in the individual state of MI for those rules, as each state has its own rules.



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #3 (permalink)  
Old 03-26-2014, 03:21 PM
Junior Member
 
Join Date: Mar 2014
Posts: 2
Thanks

Thanks, The way you say makes sense. I wish the MI-1040 instructions was as clear as you. MI seems to assume if you filed MFJ for federal, then you both lived together in MI, and therefore would have to file MFJ for MI too. I will keep looking for reference in the MI Tax code. Thanks for the clarification.



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply



Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Joint Checking Accounts and Taxes kansas_nurse Income 1 10-21-2013 01:18 AM
What to do if I haven't filed any estimated taxes and tax return for last year yet? MndD C-Corporation 2 06-27-2011 01:15 PM
Can a nonresident alien take the foreign earned income exclusion if that person meets the bona fide resident test or physical presence test? TaxGuru Income 0 02-27-2011 10:33 PM
Website automatically filed federal return twice. smith8505 Miscellaneous 1 01-29-2011 10:39 AM
How can an Alabama resident qualify as an unemployed person for an employer to claim a deduction under Reemployment Act of 2010? TaxGuru Alabama 0 07-13-2010 08:43 PM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning
 
 
 

» Recent Tax Q&A
No Threads to Display.