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Old 10-11-2011, 09:42 AM
 
33 posts, read 156,981 times
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I plan to move to Maui, and I have been advised to move my investments to an Hawaiian based investment bank, otherwise I will have to continue to file state taxes in California, where I currently live? Is this correct?
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Old 10-11-2011, 10:55 AM
 
Location: Eureka CA
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You should be talking to a tax lawyer, not posting on a forum. Yes, you pay taxes in the state where the income is earned not where you happen to live. If you have income from two different states there is a formula followed on your Federal return which is supposed to offset the double taxation but it doesn't. The year I got clobbered the worse with taxes - and I'm NOT a tax whiner- was the year I had income from both Hawaii and California. Have a pro do your taxes and good luck.
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Old 10-11-2011, 11:21 AM
 
Location: Kūkiʻo, HI & Manhattan Beach, CA
2,624 posts, read 7,255,956 times
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Quote:
Originally Posted by qwerty007 View Post
I plan to move to Maui, and I have been advised to move my investments to an Hawaiian based investment bank, otherwise I will have to continue to file state taxes in California, where I currently live? Is this correct?
It depends on your filing status, age, number of dependents, and "California adjusted gross income." For instance, if one's "California adjusted gross income" in 2010 was less than $11,803, they didn't have to file a California 540NR tax form. Review the 1099 form(s) that you receive from your current investment bank(s) to determine the portion of your investment income that comes from California sources. Most likely, you can change your "investment mix" so that the California-derived income from it falls under the threshold and filing a CA 540NR isn't necessary. Unfortunately, if you don't have to file a CA 540NR, be aware that Hawai'i will probably take more of your investment income than California would've when you file a Hawai'i N-11 or N-15.

Here are links to PDFs some of relevant forms and instructions...
California 540NR (Nonresident or Part-Year Resident Booklet)
Hawai'i N-11 (Resident Income Tax Forms and Instructions)
Hawai'i N-15 (Nonresident and Part-Year Resident Income Tax Forms and Instructions)
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Old 10-11-2011, 12:44 PM
 
33 posts, read 156,981 times
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Thanks for the replies both. Actually, I had sat down with a tax specialist and this is what they said, but I wanted confirmation, and any other input. It seems a shame I can't continue to use my current California based investment managers.
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