Just where do you pay state tax? You live in MO, you are based in NY and you spend most of your time in Chicago… so where do you pay state taxes?
An air crew employee is considered a transient, just like military personnel. Home sometimes is where the hotel pillow is. For state residency purposes your home is where you consider your “abode”. Here are some of the questions you will want to ask yourself to determine what state you call your home for tax and residency purposed:
- What state issues my driver’s license?
- Where am I registered to vote?
- Where do I own Real Estate?
- Where do I have an apartment lease?
- Where are my family heirlooms?
- Where do I return after work?
- Where do I vacation from?
Your answers to these specific questions will determine your legal state of residence. Different states have different rates and rules. GA will allow you to deduct your professional flying expenses where IL will not. However we cannot just choose where to pay tax; this location is based on the answers to the questions you just answered.
We would all like to claim residency in TX, FL, NV or another state with no state tax. For some of you, this is a reality. However using your frat brothers address in NV as your primary address can get you into major financial and legal trouble with your state. Keep in mind, that with the improvement of technology—taxing authorities are sharing information more than ever!
There is a federal ruling (Title 49, Section 40116 United States Code, (F) (C)) that will not allow any state to attach the earnings of an air crew employee unless over 50% of their flying is done within the state lines.
Therefore, we look at, real estate ownership, lease data and other “abode” situations to determine which state you should be claiming as your primary resident.
Please feel free to contact us if you have more specific questions on this issue!